Financial planning for next year

Assignment Taken

Fundraising proposal :

Subject Area: Capital Planning and Budget Process
Responsible Office: Office of Facilities Services
Sponsor: Chief Financial Officer
Originally Issued: February 2020

Purpose: Expansion plan for Daily Needs Delivery in metropolitan cities. The policy defines project leadership roles during the project phases of program development, design, and implementation.

Policy and Process:

• Any administrative unit requesting central funding for a project or proposing to spend 10 cr or more in unit funds on a project shall submit a written description of the project and a project budget to the Budget Office. The Budget Office approves projects under 10cr. All projects involving space allocation must be submitted to the Provost for approval no matter the funding level.
• Units proposing to spend 10 cr or more shall submit a written description of the project and a project budget to the Budget Office. The Budget Office will take the proposal to the Provost and CFO for approval. The Provost and CFO will ask the Capital Planning Committee (CPC) to review and approve if they feel the project has a significant impact on the Firm.

Program Development

1. For projects that require a programming and feasibility study, Facilities Services (FS) will lead program development, retain consultants and work with the unit to prepare the study (or master plan or other work, as appropriate).
2. The programming and feasibility study will be reviewed by the CPC, which will also review any space and Outlet plan considerations.

CPC Financial Plan Approval

For approved projects, FS will develop and provide to the unit an initial target budget for the project (renovation, expansion or new construction). The unit will work with the Budget Office to develop a financing plan that includes sources of revenue, the timing of cash receipts, borrowing assumptions, and other pertinent information. Fundraising is part of the financing plan, the unit will submit the plan to the Vice President for Alumni Relations and Development for a feasibility opinion.

 

Spending Approval Requirements
Project		Approval Authority
I. Annual Capital Budget		Capital Planning Committee (CPC) Projects of 25cr or more are identified individually
II. Outlet Master Plan		Board of directors
III. Individual Project Approval Levels
1. Up to 50 lakh		Unit funded*- Center funded-		No approval required. Budget Office approves.
2. 50 lakh- 2 crore		Unit or center funded-		Budget Office approves.
3. 2 crores – 4 crores		Unit or center funded-		Budget Office takes proposal to CFO and Provost for approval. CPC may review.
4. 4 crores – 15 crore		Unit or center funded-		CPC reviews. President, Provost and CFO approve.
5. 15 crores to 25 crores		Unit or center funded-		The full Board of Trustees or the Executive Committee approves.

 

Case Understanding

Daily Needs Delivery is a startup and with a seed capital of 15 lakhs, the company have some problems with its increasing expenses analysed based on last year data. The expenses are more than revenue which shows it is facing losses in recent years

BCS Solution Summary

The company expanding to metropolitan cities which will definitely one of the reasons its expenses will increase as well as its revenue will also will increase as the customer base and market share of daily need will increase

Solution

As projected in the excel file, the income projection for the next 2 years will be crucial and critical for the firm. There will be an increase in income as the fund will be raised from various source during this time. The revenue will increases at a 91% growth rate in FY2019-2020 which is significant growth during any year. The income increases at the growth rate of 24% is one of the advantages to the firm as it will pay off its debts in the coming years. Hopefully, the company significant growth will be possible with the expansion plan and with this our major investment will be in R and D and IT services. The app development and Hiring new employees will be the upcoming expenses for the company which is included in the salary part and overhead expenses. The projection is calculated on the bases of sales estimated that will increase income for the upcoming year

Conclusion

The business can grow well when it is financially doing well and for this, the plans of expansion will make it possible. And to raise funds it is important that fundraising will be an important and crucial part to increase the capital of the firm.

Attached File Details

View Attachment file (income projection.png)