Analysis Group, Enterprise Financial Management Problems and Solutions

Paper Keywords: corporate financial management improvement
Abstract: As China's economic development, competition among enterprises has become increasingly fierce, many companies in order to meet the increasingly fierce market competition, restructuring through asset optimization direction is towards the group, to form a new economic union. In order to win in the competition the most favorable competitive position, development of enterprise groups will play a key role in the market, while the vast majority of enterprise groups in China are in early stages of development, its current corporate financial management system is not perfect, there are unreasonable organization, financial system imperfections and many other issues. Successful enterprise groups, need to design a sound financial management, strengthen the financial control and supervision.

Enterprise Group is a powerful large-scale enterprises as the core, as the main link between property rights and supplemented by linking products, technology, economics, contracts and other ties, the number of enterprises and institutions linked together with a multi-level structure the parent company as the main multi-corporate economic union in the centralized control of economic, legal, independent businesses of the Commonwealth.

Group companies in accordance with established patterns of different type of group can be divided into holding companies, mixed conglomerates and managed conglomerates. The holding-based conglomerate, for example, the main mode of organization is the "pyramid" structure of the inverted triangle characteristics of both the holding company for the subordinate companies holding more than two holding companies, or forming the main body, while the two main holding company or another for more under the control of a business entity to form the third level of control of the main so, due to the transfer of capital controls, they automatically form the first level of the holding company for the underlying operating entity of capital controls, capital controls play of the natural control of assets, as shown in Figure 1;

Companies within the group generally has a number of powerful, stable core business relationship between each core businesses each have their own family business groups and holding companies, subsidiaries and affiliates owned enterprise group characteristics determine the size of it large, complex structure, a wide range of business nature of the business, and therefore, the Group's financial management than a single company's financial management is much more complex with other general business has the following characteristics: (1) multi-level management. Enterprise Group is composed of several large corporate enterprise or a coalition of business units, multi-level organization, bringing the management of multi-level (2) economic diversification the Group among the members of various forms of economic ties has brought economic diversity (3) structural diversity, from corporate ownership structure, the Group both state-owned enterprises, collective enterprises have both assets and more enterprises, small businesses have assets of both enterprises with good returns, but also efficiency is not good business, the Group's ownership structure and the variety of differences between enterprises has brought structural diversity (4) the diversity of the industry. Enterprise Group needs to expand and implement a comprehensive, series operation, breaking industry boundaries, bringing the industry diversity.

A group of corporate financial management problems
1 Group is not sound financial management system, financial infrastructure management is weak. Modern enterprise group business diversification, financial diversification, financial accounting complexity, there is often a unit of the group's accounting period is not uniform accounting, accounting policy choices are inconsistent, financial base data is not uniform, resulting in financial management within the group and individual enterprises, the group of inconsistent financial management, financial management across the enterprise, especially the financial results of merger, Group financial control, financial decision-making has caused great difficulties.

(2) inadequate financial supervision and control group. Group, a large organization, organizational structure does not regulate the internal link between the fragile relationship between parent and subsidiary companies do not straighten out, centralization and decentralization below the line balancing, operation and management functions are not clearly defined, a phenomenon often leads to group scattered resources, and thus reduce the Group's basic values ​​in the group can not establish an effective budget or resource management system, advance planning fatigue, lack of control of things, just a mere formality after the audit supervision, financial management and supervision to create great difficulties and risks .


3. Financial reporting system does not accurately reflect the operations of a subsidiary due to frequent intra-group transactions, geographically dispersed, and information transmission means backward, difficult and timely reconciliation of intra-group transactions, the information is not timely delivered. Subsidiary of the report summary to the Group merging process often takes nearly a month, financial statement disclosures of serious delay, it is difficult for business groups operating decisions. Group subsidiary companies due to the impact of sectoral interests, often accounting inaccurate statements is not true.

Second, improve the Group's corporate financial management response
(A) improve the conglomerate's financial management system.

1. Intermediation of funds managed by the Group parent company and unified. Straighten out the financial management within the group should straighten out the financial management staff, the implementation of centralized management of funds, the Group's parent company's financial departments should set up a special Department of funds or financial settlement center. Financial Settlement Center as part of the parent company financial institutions, should be separated from the traditional financial sector to be responsible for all external financial activities, including external fund raising, internal intermediation, financial settlement, capital planning, financial control and financial management .

(2) strategic importance of Investment decisions and management of the parent company should be unified. Looking at the success of foreign business groups have a strong core business, the Group's Investment activities in the overall situation, balanced decision-making, Group strengths to play to achieve group goals, while a considerable portion of China's enterprise groups, parent company their own ways, Investment confusion, duplication, blindly and so very serious, causing great economic losses and waste of money, so our Group's financial management reform, Investment centers should be established as soon as possible, and to improve the Investment management system. Links to free download http://www.hi138.com 3. the core of the financial institutions should set up an independent group Investment Center Investment Center for all strategic Investment decisions, such as Investment in new subsidiaries, mergers and acquisitions business. subsidiary of the original conversion and transformation, etc. from the Investment project selection, approval, implementation, monitoring and tracking investment performance evaluation, the full range of unified management, investment decisions and effectively centralized. for non-strategic investments, such as the purchase of equipment, if the amount is small, short-term, low risk, the investment projects can be delegated to subordinate corporate power In real operation, we need to quantify the investment authority, that business groups should be based on their own circumstances, the approval authority for funds to make a strict and clearly defined.

(B) the implementation of Chief Financial Officer appointed and qualified financial staff management system, strengthen financial supervision.

Group in order to achieve financial control of subsidiaries, property rights can be based, to a subsidiary of the investor's identity to its chief financial officer sent as the parent company sent the supervisor, Chief Financial Officer of the main functions: to oversee the subsidiary's management strategy, in particular whether the parent company's financial strategy overall strategy, once a subsidiary of the operator's behavior that undermines the interests of the subsidiary or parent company, the right to order immediate correction; supervision subsidiary established and implemented the financial management systems of work; approve or reject major investment subsidiary, financing decisions; will affect the Group's long-term development of the major issues to report to the parent company board of directors in a timely manner; the subsidiaries' financial staff to review the job qualifications and record and report to the parent company of the parent company to give other rights. Chief Financial Officer should be a subsidiary of board members, and participate in the decision-making on major issues, with a bridge of information between the parent company.

To ensure its independence in relation to subsidiaries, the financial director of wages, capital and allowances should be a unified group management and distribution, and Chief Financial Officer should implement regular rotation system so that not only the corporation's overall strategic approach in subsidiary to be more fully embody and carry out, and to regulate the financial activities of a subsidiary, to ensure that financial information is true and accurate, is conducive to the Group's overall strategic goals of the parent company subsidiaries should also be eligible for financial personnel of the management system, by the Finance Director to review their job qualifications. Report to the parent company of the record should be noted that only the parent company financial director, a subsidiary of monitoring the operation of the station supervisor. Subsidiary to carry out financial operations, also has its own chief financial officer, chief financial officer of the subsidiary's business responsible, not subject to the direct leadership of Chief Financial Officer.

(C) a financial reporting system, evaluation system designed financial indicators.

The subsidiary should be monthly, quarterly, annual and promptly submit to group headquarters of financial accounting statements, and to ensure its authenticity, legitimacy and integrity, requiring the preparation of financial reports with the report, especially on some subsequent events, liabilities, or losses, should be stated clearly to the group headquarters, in accordance with the requirements of financial evaluation, selection reflects the economic situation and the operational quality of the sensitive indicator, collected according to the daily financial, statistical and other information in a timely manner to Its close to the threshold issue of whether the warning, abnormal, timely recommendations or measures to take preventive measures while group members want to establish a capital Jinli Run was a subsidiary of the core content of financial indicators to evaluate the operator performance, the implementation of capital management responsibility system evaluation. Links to free download http://www.hi138.com