Basically this term refers to everything involving the capital of a company. And with the exponential acceleration of technologies in industry 4.0, the finance area in companies has taken great leaps towards the development of better management of corporate business.
All decisions related to investments, project financing, asset valuation and cash flow control, for example, go through corporate finance.
The finance area has become a strategic function in the commercial areas of companies, based on planning that can define goals and objectives for success in the short, medium and long term.
This field of organization is important for understanding the viability of certain projects, the need for credit or spending cuts on available financial resources. With this in mind, one of the principles is correct and efficient financial management.
To help with this understanding, we elaborated the basic corporate concepts:
Investments refer to resources employed in something that is expected to have financial returns. When the company makes acquisitions, a type of investment is configured. The expectation is that the company will be able to produce more and better and generate more revenue. The same goes for training and policies to encourage professional training for employees.
Revenue is the total volume of money that the company was able to earn from its sales in a specific period, it can be divided between gross and net. The first refers to the entire amount received. The second is the total amount after deducting taxes.
Profit is what is left over from sales after subtracting not only taxes, but also all production and investment costs.
Fixed costs are expenses that the company cannot escape, such as employee salaries and space rent. Variable costs, on the other hand, refer to expenses that depend on production volume, such as sales commission and raw materials.
Knowing what these costs are is essential for greater control over finances and more assertive financial planning.
Bearing in mind the excessive volatility and uncertainties of major cultural and technological changes, companies that will be able to visualize the future and create strategies must adopt a business synergy to analyze the various internal areas in real time and simultaneously be able to adapt and reinvent itself for external factors of the organization.
With the preparation for the future comes the need to invest in qualified ERP (Enterprise Resource Planning) systems that automate financial routines and demonstrate weekly, monthly and annual performance reports to Finance professionals to create quick mediations and prevention of futures. recurrent bottlenecks in the markets (internal and external), keeping the Corporate Financial health and its CFO's reassured.
The future is uncertain, but it is extremely important to have a general view of the data obtained by all areas of the company and a well-fed system with accurate information to be a differential in acting with excellence and envision new opportunities through the growth of new technologies .
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