How do you plan to use financial statements in your projected financial statement analysis? Provide rationale for your approach.
Respond to this:
Projected financial statement analysis is a method that allows a firm to examine how a strategic policy is evolving (David & David, 2017). In my financial statements, I plan on analyzing my monthly finances to see how well or poor we are doing. Since my strategic initiative is expansion, I must delineate the exact new service from the rest of the income statement. I must track everything related to this initiative on a monthly timeframe. Including facilities used, equipment purchased and employee salaries. Incorporating the help of the accounting section will be critical on determining the success of this plan.
In addition since we have been doing well in business for a good amount of time, I have plenty of capital built up. This will give me leverage on this plan. I also have plenty of facilities available for any firm that is interested in our initiative. Since my initiative involves collaboration, installation and monitoring on a continuous basis, I will need assistance from our partnering agencies. I will also need new dedicated staff available to only work on this project. After the first year, I should have a better understanding of how my strategic plan is evolving. Subtle adjustments will be made during this this first year. After this time, I should be able to make the determination on how to move forward. This initiative plan is something that I would truly like to initiate and I could see it being successful.
David, F. R. & David F.R. (2017). Strategic management: A competitive advantage approach, concepts & cases (16th ed.). Upper Saddle River, NJ: Pearson.