Financial processes refer to the methods and procedures completed by the Office of Finance. They are courses of action taken by the finance department in order to systematize the cash flow and the movement of the finances within the corporation. 

These processes include, but aren’t limited to:

  • Data collection
  • Budgeting
  • Planning (strategic planning, P&L and balance sheet planning, HR planning, capital planning, project planning, production and capacity planning, sales and operational planning, etc.)
  • Forecasting (long-range forecasting, rolling forecasts, cash flow forecasting, etc.)
  • Modeling
  • Financial close
  • Consolidation
  • Reporting (management, statutory, disclosure)


Sound financial processes are the backbone of a financially viable organization. The results that financial processes produce should underlie every decision, every budget line item and every direction change. Sound financial processes equate to a clearer insight into the fiscal reality of your organization.

Streamlined financial processes result in business decisions based on that financial reality.

When you produce business models and forecasts based on a single source of information, the plans, budgets and strategic decisions you make will be more informed and accurate as a result.

Optimized financial processes lead to effective use of your human resources. There’s nothing worse than having highly qualified financial professionals bogged down in menial tasks like data entry when they could be adding value to your company through analysis.

Centralized financial processes give you more confidence in what the numbers are telling you.

How to improve financial processes?

Unify financial processes. Connect all finance processes in a unified software system that handles all processes from close through to disclosure. Get a single version of the truth. When a software system automatically populates and refreshes data, the risk of human error is removed.

Streamline collaboration. Once you connect all financial processes, the next step is to connect the people that complete them. Enable users to collaborate by choosing a solution that facilitates, tracks and streamlines communication within the same single environment where other financial processes are completed.

Establishing procedures and systems to monitor the financial health of your business and meet your tax obligations helps you have a viable business.

An important part of running a business is establishing good financial procedures and systems to monitor the financial health of your business and ensure you meet your tax obligations.

You might want to seek help from an accountant, financial professional or business adviser.

Setting up a business bank account

You are advised to set up a bank account for your business, keeping it separate from your personal finances. This will enable you to monitor your income and expenses, and allow you to easily extract business records for taxation purposes.

If you’re operating a company, partnership or a trust you must have a separate bank account for tax purposes. Sole traders don’t have to open a business account, but it is a good idea. If you are trading under a business name and want to open an account in that name, you will need to provide evidence of your registration to the bank.

Creating a budget

Set a realistic budget for your business to help you meet financial goals. A budget allows you to understand your current situation and make projections. Compare forecasts to actual financial results to determine if you are over-spending or have created additional income.

Establishing an accounting system

Accounting (or bookkeeping) is a process of recording the financial transactions of a business. Keeping good records for your business can assist you to apply for finance, review your business activities, manage effectively and comply with tax requirements.

There are two types of accounting methods; cash and accrual. A cash-based system records a transaction at the time the cash was paid or received, regardless of when the sale transaction occurred. This system suits businesses that mainly rely on cash transactions. An accrual-based system records transactions when they occur, regardless of whether payment is received at the time or at a later stage. An accrual system is the one most commonly used.

You can record your transactions using either a manual or digital system.

A manual system involves entering your records into a ledger or notebook, available from a stationery shop, newsagent or office supplier.

Electronic systems use software or web-based applications and generally have other functions allowing you to issue invoices, receipts, track stock, etc. You can also use spreadsheets to record your transactions. Tax records must be kept for a period of five years after they are prepared, obtained or the transaction is completed (whichever occurs last).

Reviewing your accounts

There are two basic financial statements of relevance to small businesses:

  • profit and loss
  • balance sheet


Profit and loss reports on income, expenses, and profit.

A balance sheet reports on the assets, liabilities and net equity of a business at a given point in time.

It is good practice to review your financial statements at least once a month. This will enable you to identify problems and put strategies in place to fix them.

Ensuring your business has good cash flow and minimal exposure to debt is good financial practice. To manage your credit effectively it is advisable to create policies and procedures relating to:

  • terms and conditions for providing goods and/or services
  • invoicing and payments.
  • Find out more about providing credit to customers.


For the company. there are a number of financial processes done within the finance department, namely:

  1. Financial Report
  2. Financial Statement
  3. Disbursement
  4. Liquidation
  5. OM-FIN-008 Collection Procedure
  6. SOPs and Process Flows
  7. Profit and Loss Calculations
  8. How to Tap up Autosweep
  9. How to Top up Easy
  10. Trip RFID
  11. Lalamove Top up
  12. PO Request and Uploading to BizLink
  13. Calculate Helpdesk Indirect Cost
  14. Induction Presentation
  15. Create Bill
  16. Bank Reconciliation
  17. Adding Merchant to BPI Online
  18. SOP Purchasing using Credit Card
  19. Adding Invoice to Xero
  20. Process Flow Xero Purchase Request
  21. SOP Maternity Leave and Benefit
  22. BIR Renewal
  23. Helpdesk Indirect Cost
  24. How to Add Supplier Contact in Xero
  25. Petty Cash Fund Policy
  26. IM Cash Fund Policy
  27. Bereavement Policy
  28. Educational Policy
  29. Monetary Housing Benefit Policy
  30. Payroll Distribution
  31. Policy on HMO
  32. Salary Loan Policy