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What are the goals of financial planning?

Financial planning is the planning that is implemented for a long-term period; In order to achieve financial profits based on obtaining returns greater than the value of assets, with an increase in the growth of its market share, financial planning is defined as an activity that contributes to making decisions related to the way individuals manage their financial rights, and financial planning includes a set of aspects, One of the most important of these is preparing the financial budget, planning for taxes, saving money and others, and among other definitions of financial planning is preparing a program that helps in managing capital and financial affairs. By linking it to preparing a financial budget.

Objectives of financial planning:

 Financial planning seeks to achieve two goals, namely:

Money saving guarantee:

It is the primary and primary objective of financial planning; It is important that there is sufficient money in the company; In order to implement many activities and tasks, such as obtaining long-term assets, covering daily expenses, and ensuring the availability of financial financing in a timely manner.

Not using and wasting company resources unnecessarily:

 It is the second goal of financial planning, which is associated with over-financing of resources, which is similar to a shortage or insufficiency of money. By making use of it in the best possible way, and avoiding wasting it, which may lead to a major financial loss for the company, and financial planning for the establishments is applied over a short or long period of time.

Importance of financial planning:

Whereas, proper financial planning is considered one of the means for the success of commercial projects, and its importance includes the following points:

 Helping to choose the appropriate capital structure:

By participating in arranging funds of various sources, which are used in short-term, medium-term, and long-term periods, financial planning is necessary to benefit from the sources of money at the appropriate times; As long-term funds are obtained from bondholders and shareholders, medium-term funds are collected from financial institutions, and short-term funds are private funds in commercial banks.

 Contribution to project financing:

Kho is a financial planning formulation for a financing plan that helps determine how private funds will be used in projects, and is based on a comparison between different investment proposals.

Participation in executive activities:

It is the role of financial planning in achieving the success or failure of enterprise functions, such as distribution and production during the implementation of business; By relying on making sound financial decisions that ensure the promotion of appropriate financing and operation.

 Strengthening financial oversight:

It is the statement that financial planning provides a basic rule that contributes to examining financial activities. In order to compare actual and estimated revenue, with estimated and actual costs.

 Helping avoid trade crises:

 It is a method of financial planning that provides assistance to enterprises; In order to overcome or avoid crises and surprises that negatively affect the work environment.

 Linking the present and the future:

 It is to provide a follow-up to the current requirements of the facility’s funds, with the expected requirements in the future. By developing a set of expectations, and plans that seek to support the company's growth and sales development.

Factors affecting financial planning:

Where there are a set of factors that affect financial planning, the most important of which are:

Human factors:

These are the factors related to individuals within the establishments, and their impact depends on the application of a set of matters, the most important of which are the selection of qualified and competent workforce and appropriate experience to ensure the achievement of the required objectives, and the provision of training that contributes to supporting the skills and knowledge of employees.

Technical factors:

It is the combination of financial planning and contemporary technological techniques, which leads to increasing the effectiveness of the implementation of activities, supporting obtaining profits and reducing the amount of costs and losses.