Cash Flows

• Analyzing daily cash flows is the most crucial duty of the finance department. Every day, businesses spend money on office supplies, equipment and salaries, so it is important to monitor everyday cash flows. A company wants to keep enough cash at hand, and enough income from accounts receivable and cash sales, to cover these debts. The finance department can make adjustments and recommendations on how to adjust these cash flows for better performance.
  
  A finance department is in charge of monitoring and registering all transactions. This includes all daily company transactions, including sales and purchases. It is important that the finance department keep track of all money going out of and into the business in a timely, precise manner as cash flows dictate the health of a company. All of the transactions must be registered for later audits.
  
  

Accounts Receivable and Payable

• The finance department also makes sure that credit accounts are taken care of and that clients who are past due are contacted and their balances paid. A company must have enough money coming in from its operations to cover expenses, so when credit is extended, it must be paid in a timely manner.
  
  Paying all due bills to vendors and suppliers to cover the costs of raw material or purchased goods that were bought on credit is another area that the finance department should handle. The finance department can pay bills when they are due and make decisions on what and when to pay to maximize investment strategies.
  
  

Taxes

• Filling out tax forms and addressing deductions and tax strategies can often be performed by the finance department. They can find ways to lower the taxes owed by allowed deductions, such as through charitable contributions and tax-deferred investing. Businesses often have to file more often than individuals, so finance departments condense all of the information and complete the proper forms for the IRS and pay estimated taxes throughout the year.
  
  

Investments

• Finance departments invest extra cash to make money on the interest. Although businesses should keep a small amount of cash on hand, it is wise to invest the leftover money to increase profits for shareholders' or owners' wealth. The finance department should be able to recommended short-term investment strategies for cash and instruct owners on long-term strategies.