Business – Banking – Management – Marketing & Sales

Costs should be divided into two basic categories:
- Fixed or Variable – depending on whether the costs change with variations in production volume;

Cost Management means (1) knowledge of where, when and what company resources are used, (2) forecast of where, for what and what amount of additional financial resources are necessary, and (3) ability to ensure the highest possible efficiency level of resource use. Cost Management is the ability to save resources and maximize their efficiency.

Accounts Receivable Turnover Ratio
The Accounts Receivable Turnover Ratio indicates how many times, on average, the receivables revolve, that is, are generated and collected during the year. The receivables turnover ratio is computed as follows:

Working Capital – the most significant indicator of the Short-Term Liquidity, which is the amount of assets invested by the company in its own current operations during each operations cycle. The quantity of Working Capital reflects the share of current assets belonging to the enterprise, and at the same time it expresses the long-term financial [...]

The picture below shows the technology of integration of «Key Indicators» software with operational systems.

As an environment for development and a meta-level for data storage Microsoft Access 2000 was used.
Using internal MS Access abilities to create links with tables from almost any DB, we established links with tables from the Key Indicators data warehouse and with tables designated for export of data on average price per product from the [...]

Presentation of the table
This is, as an example, the budget of the Moscow branch of a Russian bank. We are in March 2000, and the March 2000 figures have just been calculated. The last three columns, on the right, show the year-to-date (January to March) actual figures for last year (1999), this year (2000) and [...]

Useful operational tool
As already said, this is not a theoretical exercise. This is the tool that will be used by all the operational areas to project their activity in the future, and then to check that they effectively realise what they planned.

The whole bank financial statements
The bank publishes consolidated financial statements, which show audited figures. These figures are then used, internally and externally, to compare one year to another and see the actual trend in the bank risk profile and profitability.

The necessity of a constant monitoring
The different reports have to be carefully checked each time they are produced (daily for the turnover, monthly for the profit and loss of the month, quarterly and yearly for more comprehensive figures).