FINANCIAL ANALYSIS

Managing Finance, Information and Knowledge



Introduction3

Defining the Core Ideas3

Working Capital3

Information Management4

Knowledge Management4

Environmental Scanning5

Benchmarking5

Organizational Learning5

Competitive Advantage5

Cash-Flow Forecast for Management Consultancy for Three Years Ending 20157

Computation Total Salaries Paid7

Increasing Trend in Income7

Consultancy Expenses8

Cash-Flow Forecast for Three Years Ending 20158

Cash Balance Forecast for Three Years Ending 20158

Developing Report for Management Consultancy9

Start-Up Capital Funding for Management Consultation9

Analysis of Management Consultation9

Quality Information9

Environmental Analysis10

Benefits of ICT10

Learning and Conventional Organizations11

Learning Organization and Competitive Advantage12

Evaluation of Management Consultation12

Management Consultation Staff12

Information and Knowledge Handling13

Consultation Industry13

Integrating ICT14

ICT and Environmental Scanning14

Conclusion15

References16

Managing Finance, Information and Knowledge

Introduction

This paper is written as a senior consultant in a privately owned management consultancy business, namely “Management Consultation Company”, which is to be formed in the near future. This new consultancy business will specialise in business market intelligence and knowledge management. This paper is written as a report for the Management Consultancy Company, discussing the core concepts and basic ideas used in the paper, forecasted cash flow of three years, interpretation of cash flow, and conclusion.

Defining the Core Ideas

Working Capital

Working capital is a measurement tool of company's short term financial health and its efficiency. The working capital is calculated by the following formula “Working capital= current assets- current liabilities” The working capital indicates the company's liquidity position whether it has enough current assets to cover short term liabilities and debt. The ratio between the current assets and current liabilities can be calculated as “Current ratio= current assets/ current liabilities”.

The ratio also indicates the company's liquidity position. If the ratio results in below 1 then it means the company has negative working capital and is unable to pay off its current liabilities, and it is an alarming situation for the company. If it is 2 or above then it is considered that the company is not investing its excess assets properly. By investing the short term assets properly a company can earn interest easily. So it is suggested that the ratio must be between 1.2-1.5.

Information Management

Information is a collection of physical and electronic information. The structure of the organization must be able to manage this information throughout the entire lifecycle of information, regardless of format and source, for delivery by multiple channels, which may also, encompasses web interfaces and cell phones. It is management of information and its distribution through different channels to different audiences.

Knowledge Management

Knowledge management comprises a range of practices and strategies that are used within the organization to create, identify, distribute, represent and enable adoption of experiences and insights. These experiences and insights comprise knowledge either embedded in the organization or embodied in individuals as practices and processes. Knowledge management focuses on objectives of the organization such as a competitive advantage, improved performance, innovation, integration, sharing of knowledge and continuous improvement of the organization.

Information Communication Technology (ICT) Information communication technology specifically focuses on the organization's integration of telecommunication, unified communication, integration of computers, enterprise software, data storage, middleware which enable to access, transmit, store and manipulate data. Use of information communication technology provides an organization many economic benefits by merging the audio-visual, telephone network ...