Need of Financial planning & Analysis in Mid size companies

FP&A:

Which stands for Financial Planning &Analysis

Macro level and Micro Level

Let me explain by example:

TATA dealer sells Various types of vehicles in various locations.
Now regular accounting team ensures the below:

• Sales & Purchase
• Receipts & Payments
• GST/TDS/IT
• Financials/Audit
• And, Sales team works on product wise profit and segment or location wise profit, also, periodical comparison. Etc

When it comes to whole entity, these numbers should also consider cost of capital, Indirect costs..etc

Macro level can be performed by the Accounts team, but not the Micro level. It requires an expert. “Bundle of Benefits”

One can sell the same Product at competitive price
One can focus on the better profitability options
One can identify the flaws and less use practices
One can incentivise the sales team without loss of profit
One can reduce the cost of capital and inventory
One can better invest the existing funds
One can plan the future periods and track the same
Finally, FP&A provides the management, a great control on the business.

If there exists better process for book keeping and data management, there will be better result from FP&A. mostly at the time of book keeping it self FP&A can be automated with present time free tools