Instructions: Apply these below instructions for the topic below and provide answer with 150- 200 words in APA format
1. Challenge something that has been posted
2. Pose a related question or issue
3. Suggest a different perspective or interpretation
4. Pull in related information from other sources with proper citation - books, articles, websites, courses, etc.
Please read below:
A) Financial Acuity in Business
Understanding financial acuity and its correct application help the organization to grow. An employee of the organization should get a training to understand financial acuity and their role to make a growth. A study conducted in Halogen Software in collaboration with Harvard University proved that financial acumen skills development is necessary for all level managers.
It is also stated further that improving the financial acumen of all IT professionals, HR professional and Project managers have a lasting impact on an organization bottom line. Financial acumen is more than a number it is workplace competency for all level employees in the organization. Skills involved in financial acumen developments involve understanding the meaning of financial acumen, Analysing financial data, Application of this financial data analysis and communicating financial data.
Today lot's of employees are taking professional courses to learn and apply financial acumen skills to their organization growth. Overall business growth is the main focus but apart from that what are other sources makes financial acumen so important. Many companies diversify its business for an example Amazon was an online bookstore initially but in a few years, it started trading all products all over the world. Their employees understood financial acuity very well to diverse business. Now they are coming with amazon fresh to deliver grocery on daily basis.
I have worked with a small company which is IT solution provider in the USA. most of the employees do not understand what is financial acuity and hence they are not contributing their 100% to the company's growth with the help of Hr we have arranged special training for junior level employees which has helped them to improve their performance for company benefit.
There is a strong dependence between the financial expertise of employees and organization policy and performance. Employees with detail knowledge about financial acuity make a better decision in term of holding a less cash and applying debt well to make the most profit.
Financial acumen is complex and to deal with it effectively one must manage multiple indicators like policies, stockholders, and competitors effectively.
Internal factors within an organization which help to control financial acuity are policies and Fund. External factors which contribute to financial acuity decisions are stakeholders, companies market image, and value.
The real estate people, Financial traders, and financial institutions are majorly working on financial acuity decisions effectively. It is necessary to educate all level employees about from where the company is gaining profit to avoid loss. It's not only higher management or board of directors who should think and apply their knowledge for financial acuity it should be overall contribution withing firm form all level of employees.
B) Sarbanes-Oxley Act:
The main motto of the Act was to retain public trust in financial reporting. The Sarbanes Oxley Act is introduced in 2002 to make sure companies utilize their financial resources to optimize its growth. It is easy to start a business or firm in the USA but for growth exceptional financial decisions must be made. This act is providing the benefit of financial report users to know about company worth. It does not vary with the size of the company.
Under this act, company is entitling to disclose companies internal control over financial reporting. Section 404 undermining financial statement accuracy because companies are no longer dependent on their auditor.
Smaller companies require less audit control and hence auditors have lesser responsibilities. Section 404 involves much easy control over companies financial reporting. Whereas Sarbanes has introduced strong control and greater audit understanding for small size companies. It was further revised in 2015 to make sure small group companies are well benefited and continue to grow.
The overall conclusion is that the Sarbanes-Oxley Act has provided a much clear picture of companies' financial report. It comes with dos and don'ts. Sarbanes-Oxley Act 2002 was introduced for regulating financial freedom for the company for its profit growth.