The significance for the financial help is to keep the company from going under. This will help management understand the necessary steps needed to run the company smoothly. The first thing is to understand the role and significance of management understanding the balance sheet and what goes where as far as the assets, liabilities, and owners' equity. What is debited and what is credited or what are the categories for the income statement.
Also the next thing in preparing the financial abilities for the company you should know how to budget things. The budget consist of: operating budget, cash budget, and a capital budget. In the operating budget you have the sales forecasting and the forecasting. This helps through preparation of the sales forecast.
The cash-flow budget provides an overview of the cash inflows and outflows during the period. By pinpointing cash problems in advance, management can make the necessary financing arrangements. This includes cash sales, cash payments received on account, and loan proceeds. Please view the video below.