Financial Analysis Financial Management - 1125 Words

According to Buchbinder Shanks (2012, p. 204), cash budget defined as â€Å"the necessary step that allows the organization to determine how to optimize the value of the cash being generated by its operations. More interestingly, this also defined as a forecast of cash inflows, cash outflows and net lending and borrowing needs for the months ahead†. From the point of what I understand the discussed definition of a cash budget, it looks like similar to operating budget however, there is a certain difference. A cash budget is simply a forecast of the operating budget. It looks both cash inflows and outflows as well as lending and borrowing needs in an organization. Managerial accounting provides financial data for an†¦show more content†¦188). Therefore, utilizing these departments as starting point to analyze the budget process of the Happy Town Neurology is important because they provide me both the accounting function and management of financial assets. It seems po ssible that I could get an overall understanding when creating cash budget for the upcoming fiscal year. Cash flow forecasts aim to predict future financial liquidity over a specific period of time. Generally, forecasts are made using about five years’ worth of historical data. Getting started with creating cash flow forecasts may want to consider starting with short-term forecasts. Short-term cash flow forecasting is based on actual cash receipt and disbursement data (Lohrey, n.d). With that being said, I would go back to the last five years to see how the cash budget has transformed over the years to guide me on what to expect for the upcoming fiscal year. I will work on cash inflows and outflows for the specified years to accurately analyze what was undergone in the operating budget. Again, in order to accomplish this, I may utilize some of the personnel indicated and departments as well. After I collect all the necessary information from the important personnel and depa rtments that available for the past five-year budget, I will evaluate them accordingly and with a careful attention given to cash inflow and outflows. Initially, I will insist on forecasting cash