Analysis of financial management innovation of SMEs in China

Paper Keywords Financial management for small and medium enterprise innovation
Abstract rapid Economic development, so that our small business financial management also opened a new situation, but due to constraints such as firm size and influence, China's small and medium enterprise financial management, there are still some problems, therefore, become the financial management of innovation Small business managers focus.


In the 21st century, China's rapid Economic development, especially small and medium enterprises is growing rapidly mushroomed, according to statistics of relevant departments, to the end of 2005, China's SMEs account for more than 99% of the number of firms, to create, six into so gross national product, and bear the promotion of Economic development, promoting technological innovation, increase staff employment and other projects, it is the most dynamic Economic development and rising power of Economic organizations. due to their size and other effects, these small and medium the financial management has been greatly limited, resulting in operating, financing and there exist many issues that hinder the development of enterprises.

First, the issue of financial management for small and medium enterprises
(A weak financial control
By the impact of firm size, small and medium enterprises strict cash management, and financial management is not a scientific concept. The one hand, managers of that capital as possible, but never pay attention to the flow of idle funds, resulting in a lack of planned use of funds and arrangements, prone part of the funds in the operating process of the waste, the other for the lack of effective management of credit funds, resulting in difficulties in the recovery of funds, accounts receivable turnover is slow, once the companies need a lot of money to support further development, the lack of effective corporate capital investment, the three is that many SME managers for inventory control is relatively weak, resulting in cash flow failure, in addition, for the finished products, finished products, raw materials management in place, lack of management problems, but also lead to a serious waste of assets, which are small and medium enterprises on the asset management problems.

(B) the financing difficulties, a serious shortage of funds
The biggest problem is that small and medium enterprises financing, guarantees difficult. By firm size restrictions, lack of capital investment itself, and if debt, etc., could easily lead to small and medium enterprises with low credit rating, financing difficulties, while China is not dedicated for the small business management support institutions, the state preferential policies and not much inclined to small and medium enterprises, has been in the independent development of these enterprises, to fend for themselves the state long-term disadvantage, resulting in difficulties in financing enterprises, the lack of further development funding.

China's banking policy and the traditional view of the effects of too much attention to large and state-owned enterprises, loans to small and medium enterprises is not enough, also affecting the other hand, the functioning of capital for small and medium enterprises, while banks and financial institutions in general is the major source of funding small businesses, but relatively large state-owned enterprises, small and medium enterprise loans more difficult, even loans to entertain, but also prone to higher lending rates increased financial risk factors, and indirectly increase the cost of financing small and medium enterprises, so small and medium enterprises in the case of receipt of funds, with little regard to how to expand their scale, and more attention to how to recover the funds as quickly as possible, without making a long-term plan, showing quick quick quick success of fishing and other phenomena, which resulting in small and medium enterprises can hardly be a greater development.

(C management rigid, outdated
SME operators of retail investors is that this centralized management model will affect corporate financial management.'s Centralized management of business leaders, all of the enterprise's development direction of a person by the manager, said the count, the manager for the financial lack of effective management theory and practical operation experience, easily lead to financial management duties, regardless, poor management, lax financial controls, financial information and other issues of inaccurate data. coupled with the oversight of the auditing companies have no dedicated staff, it is difficult to protect effectively the funds and co-existing applications.

(Four lower vocational skills of financial management
Influence by stage of business development, especially in the business enterprise, and many more family-oriented nature, and finance as a core part of business, many more close by the people within the family operation, and these people have not been part of the financial management specialist learning, for the financial management is limited to accounting, statistics, profits, etc., so there is no effective financial management responsibilities. financial management resulting data will provide an effective enterprise data to support the development, and financial management by the staff themselves the skills of the impact of the financial management of small and medium enterprises are often not effectively play its real role.

Second, the future development of innovative financial management
(A financial management objectives of innovation
How effectively the funds through the financial supervision, to avoid the risk of corporate financial management, profit maximization, is the most direct corporate financial management objectives. With the social and economic development, financial management of small and medium enterprises have shown a multi-target trend, from the traditional pursuit of corporate profit maximization, to maximize shareholder value, stakeholder body, the direction of the community to maximize the interests of continuous development. Links to free download http://www.hi138.com
(Two innovative financial management
1. To establish a financial management as the enterprise management system
Financial management, the ultimate goal is to make effective control of corporate funds in order to achieve the business activities of enterprises can be effectively carried out, which requires the establishment of a sound to the center of the enterprise financial management system, financial management into enterprise management the core, covering all aspects of business, which is the modern society of corporate financial requirements.

(2) the establishment of financial management information system
Economic progress, the most notable feature is the application of information technology, financial management, but also into the Computerized process. Computerized financial management to make faster and more efficient, but also to make the relevant financial information, effective data validation, for the establishment of a financial Center enterprise management information processing systems, this will enable the production of accounting and business management, business management, integration, to achieve optimal economic efficiency of enterprises, the further development of the enterprise data provide strong support and funding.

(C content of the financial management of innovation
At this stage, the focus of financial management, including effective use of the funds and financial risk aversion, which requires the establishment of small and medium enterprise financial management, financial risk early warning system to effectively identify the financial risk warning, to avoid risks, and potential financial risks issues and losses estimated in advance, to provide technical support for risk management, sound financial control and risk transfer mechanisms, the business is the inevitable risk of coming face financial risks companies must improve risk control and transfer mechanisms, the use of multiple operations, foreign investment diversification and other programs to achieve and avoid the risk of spread.

Knowledge economy, but also many opportunities for small and medium enterprises, knowledge has been transformed into productivity, become more powerful than tangible assets, the "knowledge", which also made small and medium enterprise financial management requirements, to break the traditional physical asset management philosophy of knowledge into productivity, not only the importance of human capital, more effective use of knowledge capital to improve the efficiency of re-innovation and enterprise financial management content.


References:
[1] Nie flame. On the financial management utility accounting .2010 (03).

[2] Liu Huimin, strengthen financial management of exploration and reflection. Public utility accounting, 2003 (02). Links to free download http://www.hi138.com