The finances of Tesco
The finances of Tesco are observed centrally through Tesco’s Head Office. The finance department manage all the money coming in and out of the business. Each individual store has their sales figures monitored electronically. It is then the responsibility of the Finance people at the Head Office to set each individual store targets and re-examine these. This information will then be used to practise the accounts of the company. This will consist of balance sheets and profit/loss accounts. As Tesco is a Public Limited Company all of this information has to be published to shareholders and the public.
The finance department also deal with preparing accounts and paying wages and salaries. Business need to understand this information so they can plan what to do next. The financial department also deals with other payments, and may also work with other departments within the business. In small business the owner might look after the financial records. Usually firms pay someone to look after their accounts. In larger business the firm might have full-time staff looking after the finances. Also if the firm is large enough it will employ people to work within the business.
As Tesco is such a large organisation they’ll employ three types of accountants, these are: financial accountants, cost accountants and management accountants: Financial accountants – usually only larger organisations have financial accountants. The financial accountant has to keep record of how much the business spends and how this has affected the profits of the business. He or she has to produce regular reports showing how the company’s money has been spent and what income has been received. This information is vital a sit helps the managers plan future activity. The financial accountants prepare the profit and loss accounts and balance sheets.
Cost accountants – the cost accountant calculates the costs of the business services and products. By showing which parts of the organisation are efficient the accountant may contribute to haw the business is organised. The accountant is able to show which products are most profitable, this helps the manager decide on what to decide. Their cost accountants may work closely with other departments to make sure that costs are measured as accurately as possible. Cost accountants help managers make decisions about the most efficient ways of running the firm.
Management accountants – the Management accountant deals with the actual income and expenditure of each of the businesses activities. Departments may be given money to perform their various tasks and are set targets on how much they have to earn, this is a budget. The Management Account advises managers about how well the various departments are meeting their budget. This allows them to made decisions before, for example, a department spends too much.
It is important for Tesco to have a large finance department because it is a big company that has a lot of capital income. If they had a small department they won’t be able to keep record of all the income. Administration and IT support Administration and IT support cover a range of tasks such as: Clerical work (collecting and distributing mail, keeping records, organising meetings and responding to enquiries) Cleaning and maintenance Health and safety Security Support for software applications (word processing, payroll, accounts, databases, etc), electronic communications and electric transaction.
Most business gets mail in 2 ways direct delivery and private delivery. Direct delivery is the most common way to deliver post direct to the firms business address. In larger business, like Tesco the delivery will be to the firm’s reception desk. The disadvantage is that work cannot be done until the post has been delivered. Private box is when a business can rent a box at a local post office. Each box has a number on it that is part of the firms address. The post is kept there until it is collected by the businesses representative. The representative can arrange a time to pick up the post. Filing is the most common way to store paper. It can be stored in different orders, Alphabetical, chronological and geographical.
Logbooks are also used in businesses. Logbooks are like diaries. The most common type of log book is probably the post book, this is where Tesco will keep record of the post and the parcels that come in and leave the business. Logbooks are also used to keep record of the visitors to the business. Logbooks are a way of recording actions so information can be tracked down when it is needed. Administration and IT support also deal with organising meetings, meeting sizes can vary from 2 to a whole company of hundreds. They have to make sure that all the people that need to be there are all there. A disadvantage of meetings is that they can take staff away from other jobs. Most meeting have a chair or chairperson, this person’s job is to make sure the meeting goes smoothly and that everyone gets a chance to contribute to the meeting and the sectary will keep record of the meetings decisions.