Dynamic control of financial performance

Support of identification and control of influences affecting the economic result, budget items and cash-flow are the main objectives of the Business Financial Performance (“BFP”). This functional area of Business Navigation System (BNS) has facilitated the tasks of the financial directors or managers on lower management levels, centre managers and other specialists in many companies.

Structure

Equally as the other functional areas the Business Financial Performance has within the framework of Business Navigation concept its standardized shape:
The solution is based on three BNS modules, namely, the Fixed Costs, Economic Result and Master Plan. They are usually supplemented by the fourth, above-the-standard module Cash-Flow. Modules serve to set up, continuously to update and to control fulfilment of the financial plan.

• Fixed and overhead costs of centres (“FC”).
  FC module serves to plan and analyse financial costs, which were incurred based on the operational plan of costs in a particular period and by separate centres. In addition to planning the administrative costs, the module may be utilized e.g. for planning of fixed costs incurred by transport and energy, write offs and some other types of personal costs. The plan values are specified directly in the centreęs profit and loss accounts. They are further processed there or consolidated for the purposes of the whole company.
  
• Economic result (“ER”).
  ER module helps identifying the effects of crucial company processes in regard of the company business performance, both at the organizational line and product or client line. It consolidates the values planned in the Fixed Costs module and Variable Costs and Sales Performance modules from other BNS functional areas. ER module evaluates the plan fulfilment and studies the differences of the business result, while being structured per separate effects, including the graphic illustration of differences (EBIT bridge, etc.).
  
• Master Plan (“MP”).
  MP module enables a simple calculation of the balance sheet planned items. It will clearly show the financial statements (balance sheet, profit and loss account or cash-flow statement) and at the same time monitor the specified indicator of business performance. It enables to select between the tabloid and graphic illustration (including, among others, DuPont Analysis/ROE Pyramidal Breakdown, and/or spider diagrams) and to perform a wide range of financial analyses, during which the user fully controls the calculation rules.
  
• Cash-Flow (“CF”).
  The above-the-standard module task is to optimize procedures when outlining future cash-flows. It involves planning of the new working capital (receivables, payables, goods on stock, funds), whether of an investment nature (investments, repairs, leasing, etc.) or a financial nature (credits, share capital, etc.).

Processes of the business financial performance are equally as all the other BNS functional areas structured in two modes, namely, the Builder and the Analyser. The first one models the company financial future, i.e. its sets up financial plans, forecasts and simulations. The second one serves for reporting of financial results, financial performance and analyses of variations compared with the original plan.

You should decide for BNS BFP if …

…you strive for a truthful and faithful illustration of all the processes in the company financial statements (balance sheet, profit and loss account, cash-flow);
…you wish to know the variations in the course of company processes and their impact on the company financial results;
…you need to obtain a higher-quality documentation to decide on suitability of investment projects and their impact on the development of the crucial indicators of the company performance;
…you have to respond quickly to any events which might result in undesirable changes of the production cost effectiveness; and
…you feel the necessity to obtain the clearer information on the working capital and to interconnect its management with the progresses of logistics and manufacturing.

BNS – BFP benefits

• It enables the precise control of centres budgets, while observing economic connections with other departments.
  
• It dynamically interconnects the control of centreęs budgets, projects and orders.
  
• It establishes new standards and rules for the decentralized control of economy.
  
• The management has a better overview of the capital being available and is able to connect it in a simple way with the production and logistic processes.
  
• It creates a clear interface between the local and concern reporting according to international standards.
  
• It makes the processes important for management of the business financial performance more transparent and thanks to that reduces the costs.

Planning procedures

• Adjustment of fixed and overhead costs
  
• Adjustment of other revenues
  
• Breakdown of linear trends
  
• Plan of assets
  
• Plan of credits
  
• Plan of receivables and payables
  
• Financial and investment cash-flow
  
• Working capital plan

Analytical procedures

• Plan fulfilment – management profit and loss account
  
• Managerial Balance sheet
  
• Financial statements (CAS)
  
• Financial statements (IAS/IFSR, US GAAP)
  
• Du-Pont analysis
  
• Variance analyses
  
• Plan fulfilment chessboard
  
• Spider diagram
  
• Trend analyses