Financial Decision Taking Essay Example | Topics and Well Written Essays - 3500 words

Financial Decision Taking - Essay Example The TMO is also a service-oriented firm with limited resources, such that a well-taken financial decision is critical to its organizational integrity. This essay is structured such that the succeeding sections consist of an assessment, a lineup of conceptual models, a critical evaluation and a conclusion. In the assessment section, the essay discusses the importance of financial planning in the context of TMO's organizational structure and strategic goals. The conceptual models review the available literature on the subject, while the critical evaluation attempts to relate the academic models so mentioned to the real world, meaning the TMO. As part of the conclusion, we will appraise the financial decisions and strategies most suitable for the TMO based on all the preceding data. The TMO administers a London borough consisting of 238 homes of individual designs on eight blocks of a small housing project alongside a main road. This is one of the oldest of similar setups in London, where the blocks of houses had been there as far back as 1947 such that they are in dire need of refurbishing and maintenance. Families of multi-racial origin occupy these housing units under either a tenancy or leasehold agreement, and the estate is easily accessible by bus and subway train services. This TMO became a self-governing body in April 2003, as did four other TMOs managing similar estates in the London area, when the local government compartmentalized its function of providing low-cost housing services to constituents. This fragmentation process came on the heels of the privatization binge involving local government assets and service, a major program of the national government since 1979. Now, the TMO runs the borough through a management committee headed by an operatio ns manager and supported by a six-man staff. The turnover of housing functions to TMO was part of the central government's cost-cutting program and strategy of getting politics out of social services, which tended to hamper activities in this area when local authorities were in control. Thus, management of the housing funds was shifted to agencies, which would be more accountable at the central level and less accountable to local political forces (Cairncross & Calpham). In ceding the function to the TMOs, however, the local authorities set the ground rules that exhort the former to utilize "creative accounting measures." These include; 1) building up a revenue balance to regular the yearly expenditures; 2) sale of suitable assets to generate income for use as capital expenditure; 3) rescheduling existing debts; 4) capitalizing the expenditure on such activities as repair and modernization previously