Financial Control

Posted in Finance, Accounting and Economics Terms, Total Reads: 1762

Definition: Financial Control

Control of financial activities carried out in an organization to achieve desired objectives. Financial control also provides a set of rules and regulations with regard to the financial management systems followed in an organization. All organizations have financial controls to ensure effective financial management. Most organizations have financial controls to ensure that everyone is aware of procedures to be followed and to ensure that there is better understanding of each one’s responsibility.

Some of the key aspects of financial control include:

  • Records and reports – who maintains records , who is responsible for information entry, the nature of information entered
  • Banking – who is authorized to sign cheques, who handles banking responsibilities
  • Authorization – who can order goods, services etc. on behalf of the organization, who will spend on behalf of the organization
  • Budget – preparation and monitoring
  • Expenses – list of items included in expenses
  • Inventory – who is responsible for maintaining inventory

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