Structure And Function Of

Finance Department

Presenter: Syed Muhammad Azeem

Financial Management Financial Management means

planning, organizing, directing and controlling the financial

activities such as procurement and utilization of funds of the

enterprise.

Functions Of Financial Management

• Estimation of capital requirements• Determination of capital

composition• Choice of sources of funds• Investment of funds• Disposal of surplus• Cash management and control

State Bank Of Pakistan

• The State Bank of Pakistan (SBP) is the central bank of Pakistan.

• Founded In 1948 • The headquarters are located in the

financial capital of Pakistan, Karachi with its second headquarters in the capital, Islamabad.

Finance department of SBP

Financial Accounts Division (FAD)•Preparation of annual financial statements.•Weekly statement of affairs to be published in govt. gazette. •Quarterly Profit updates to the board of directors.

FAD (Cont.)• To provide information for

informed decision making.• Preparation of daily balance

position and communicating to federal division and provincial finance department.

• Consolidation of all departmental budgets.

Forex, Securities and investment division

• Maintenance and record of cash reserve requirement.

• Fcy payments of Govt. and SBP.• Maintenance and revaluation of

fcy assets and liabilities.• Revaluation of IMF Loans

System And Procedure Division

• Representing finance department in various automation projects.

• It recommends continuous business process refinement.

• Participates in automated system development/Implementation.

Payment Controller Division

• Payments to external suppliers and to the employees.

• Checking and verifying selected transactions/cases referred by director finance.

Asset Management Division• Keeping track of physical location of

assets.• Maintaining financial information of

assets.• Ensure smooth running of fixed asset

management function.• To record all expenses regarding

repair/ maintenance and taxes for SBP building and Equipment.

Currency management Division

• Policy making and currency management includes Designing, Printing and issuance of Notes.

• Preparation of balance sheet of “issuance department” at fiscal year end.

• Issuance of statement of affair of “issuance department” on weekly, Monthly or quarterly basis.

Support services division• Deals with administrative problems in

Finance department.• Develops healthy environment in

finance department. • Dissemination of any revision in law,

policy and regulation matters to concerned division.

SWOT Analysis

Strengths• It is state bank.• Strong internal control.• Formalization and simple

structure.

Weakness• Lacks IT advancement.• Less training programs.• Not adopting latest

practices.

Opportunities• Can attract best talent.• Can adopt latest IT

programs to Enhance speed and efficiency.

Threats• Political instability.• Excessive govt.

borrowings.

Recommendations

• Latest version of Globus and Oracle should be used.

• Training sessions should be increased.

• Finance department should adopt latest practices to cope with challenges.