Corporate Finance for HOA Management Companies
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We define Corporate Finance for your Management company by the following areas. The reason we have defined Corporate Finance this way is that each area presents opportunities to save time and money. Within our Exclusive Membership area, we give information on each: - Financial Statements - Cash Flow - Profitability Reporting - Internal Controls and Check Signing - Bookkeeping Corporate Finance is one of the most important areas of an organization, and yet in the industry of Homeowner ‘s Association, it is often discounted or overlooked in its entirety. Corporate Finance includes many areas, for example, financial reporting, cash flow management, internal controls, cash management of banks and banking and bookkeeping services. On the following pages, we will talk about financial statements, including profit and loss, statement of cash flows and the balance sheet. We will also look at cash flow, and how creating a well-organized and well-structured HOA management company can create what’s called “negative networking capital.” Negative networking capital is one of the critical ways in which Dell and Wal-Mart make money off of money. In fact, its been argued that Dell doesn’t actually make money off of selling products, it makes money off of properly managing its cash flows. You can do this too. Internal controls are things like checks and balances. Internal controls include things like: Who signs checks? Are there double signatures or single signatures? Where are the checks kept? Are they under lock and key? How is money paid out to vendors, and who is in charge of authorizing such payment to vendors? Internal controls are critically important if you are not the only one working in your organization. And in fact, the larger your organization gets, the more important the internal controls are to ensure that liability is reduced and exposure to loss is minimized for you the owner. Bookkeeping is a critical area of Corporate Finance. Without sound, correct bookkeeping and a properly decided method of accounting, whether it’s accrual or cash basis accounting for your corporate organization, you will be unable to make effective executive and business decisions. You need to have the correct financial information that bookkeepers will put into your accounting system for you to make decisions. For example, if your accounts payable are not entered properly and timely, you will have cash flow problems in your organization and decision problems on which items need to be paid and when, thus causing problems with vendors, suppliers and even staff. So bookkeeping is a critical area! You can become a VIP Member of HOA Profit Gurus and get Your VIP Password today! Members get 1) access to more tips, 2) implementation guidelines for our suggestions, 3) discounts on Private Coaching and more.
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