Companies doing business in the Philippines must comply with the Philippine Financial

Reporting Standards (PFRS). The PFRS is a set of Generally Accepted Accounting Principles (GAAP) issued
by the Accounting Standards Council (ASC) to govern the preparation of financial statements. These
standards aim to promote fairness, transparency, and accuracy in financial reporting. The value of
financial management may vary depending on the nature of your business and the ways and means by
which you manage your cash flow. For some, managing their finances is important as it keeps them from
missing payment deadlines. Others pursue financial management to keep better track of their invoicing
and debt collection processes. Meanwhile, there are also some business owners who simply want to
ensure the wise use of their cash flow.

The company set feasible financial target that are within their range. They have a proper cash
management such as the proper approval of disbursement, setting up of controls over petty cash fund,
bank reconciliation, addressing proper segregation of duties over cash management and proper
archiving of documents. They have reliable accounting software that is necessary to their business. It
helps them to track their finances, generate applicable financial documents and collaborate with
accountants.

They keep track of their general ledger. The general ledger is the basic building block of
accounting. Every company has a general ledger, even if you aren't accustomed to calling it that. The
general ledger lists your various accounts and the balance of each account. These are assets, liabilities,
equity, revenue and expenses. Under each of these accounts, you may have subaccounts or individual
lines for various inflows and outflows of money. Each time a transaction happens; you should record it
in the general ledger in the correct account and then balance the accounts accordingly. The general
ledger then becomes a reference document. If you keep it continually updated, you have a constant idea
of how much money you have.

Financial statements are important on a company because it is the official reports of the
companys finances. There are three types of financial statements -- the income statement, balance
sheet and statement of cash flow. The statements are produced on a semi-annual basis. The income
statement details the revenue and expenses and lists the net profit or loss for that specific period. The
balance sheet lists the company's physical assets, its liabilities and its equity on the day the report is
generated. The cash flow statement charts how the company's physical cash on hand has changed over
time, and the statement of owner's equity shows the balance in the amount of ownership each partner
in the business has. Financial statements are useful tools for board members and managers to monitor
how well the company is doing. At the end of each year, they are performing a self-audit that involves
adjusting any entries to the general ledger to account any mistakes. Theyre also closing several
accounts that have temporary balances. They also hire an external auditor to review their books and
financial statements.