Public bodies are expected to deliver services while meeting high standards of transparency and accountability and demonstrating the efficient use of public resources.
Getting a full picture of financial performance across an organisation has never been so crucial. Here are 10 tips for better financial management:
- A change in thinking is a start Implementing effective change in organisations requires a financial function that is not stuck in the traditional role of ‘keeping the score’. It’s much more than that.
- Develop a strong vision Develop a strong and visionary leadership for both the finance function and the organisation. The leaders need sound advice covering cost benefit, option appraisals and risk analysis.
- The finance function at the heart The chief finance officer and the finance function are the champions, delivering and aiding strong performance and transformation including efficiency, effectiveness and commercial skilling.
- Finance management as an end-to-end process Financial management needs to be considered with an end-to-end process with clear ownership of the whole process – and focus on required outcomes and outputs.
- More collaboration with added service insight Supporting performance effectively requires a different relationship between finance staff and line managers, bringing together an understanding of costs with a more detailed knowledge of the nature and quantity of services being provided.
- Add weight to your fiscal strategy Place financial strategy – medium-term financial plans and documents – at the core of corporate planning and demonstrate the stability it provides together with advanced business modelling.
- Budget setting to maximise income Recalibrate spending to drive efficiency savings and maximise income through charging, fees and tax to help counter reducing resources and demonstrate improving value for money.
- Transformation with accountability Good financial management is key to fundamental change and to establishing confidence in the public services. Accountability needs to be established in an organisation through ensuring a strong role for the CFO as a member of the leadership team reporting to the CEO with access to the board and audit committees.
- Get the right systems and processes It’s vital that the right systems are in place to keep finance on track. Issues can be dealt with at an early stage and efficiency techniques used such as reengineering processes, best practice procurement and maximising collaborative opportunities.
- Realise strong financial management is the responsibility of the whole organisation Ultimately excellence in financial management is driven by the finance function but relies particularly on the relationship between finance staff, budget holders and external stakeholders – a collaborative approach based on understanding of costs and an organisation’s strategic direction.
Article sponsored and supplied by the Chartered Institute of Public Finance & Accountancy
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