BUSS3- Types of Financial objectives

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  • Types of Financial Objectives
    • Cash Flow targets
      • Reducing the Bank overdraft
      • Spreading the costs more evenly throughout the year
      • Holding a certain level of liquid, non-cash items
    • Cost Minimisation
      • can benefit from high profit margins/ increased sales volume
      • reducing raw materials
      • reducing wage costs per unit
      • lowering levels of wastage
      • improving the efficiency of production
    • ROCE targets
      • formula %: Net profit/ capital employed x100
      • a ROCE that exceeds the level recorded the previous year by a %
      • a ROCE that exceeds the level of a particular competitor or group of competitors
    • Shareholders' returns
      • High Dividend per share
      • increasing share price
      • high earnings per share
      • high dividend yield


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