Which of the following is an example of a non-financial objective?
Non-Financial Objective Examples
Non-financial aims are those that focus on other areas other than financial means, these can include customer satisfaction, employee loyalty and social responsibility.
Answer and Explanation:
The correct option is (C) Provide information on the liquidation value of an enterprise. While liquidation is one of the factors that can be deduced from financial reports, it does not stand out as one of the main objectives of financial reporting.
Non-financial motives relate to an entrepreneur setting up a business for reasons other than to make money. Reasons might include personal satisfaction, challenge, being your own boss and independence. An entrepreneur may feel a level of personal satisfaction that they have created a successful business.
NBFIs supplement banks in providing financial services to individuals and firms. They can provide competition for banks in the provision of these services. While banks may offer a set of financial services as a package deal, NBFIs unbundle these services, tailoring their services to particular groups.
Non-financial aims and objectives are those that are related to areas such as customer satisfaction, employee satisfaction, and environmental sustainability. They focus on the broader impact a company has on society and the world around it.
However, financial data alone may not capture the full picture of the value and potential of a business or project. Non-financial data, such as customer satisfaction, employee engagement, social impact, environmental footprint, and innovation, can provide additional insights and context to the financial analysis.
The four primary financial objectives of firms are; stability, liquidity, profitability, and efficiency. The profitability objective focuses on generating enough revenue to meet the firms' expenses and the desired profit margin.
The following are examples of financial objectives:
Growth in revenues. Growth in earnings. Wider profit margins. Bigger cash flows.
There are six types of financial objectives: revenue objectives, cost objectives, profit objectives, cash flow objectives, investment objectives and capital structure objectives. Financial objectives can be set by both enterprises and individuals. These are called personal financial objectives.
What does non-financial objective mean in business?
Non-financial aims and objectives. are linked to anything other than making money for the business. These are usually linked to personal reasons behind an entrepreneur. setting up a business.
Non-Financial Corporations are for-profit entities, that is market entities. For example, charities providing accommodation for the homeless below market prices are Non-Profit Institutions Serving Households, while hostels and hotels that are providing a similar service at market prices are Non-Financial Corporations.
Non-financial aims and objectives
Some will need to be set that are different from simply making money as the business owners or staff work towards other goals. Public sector organisations will have more non-financial objectives than private businesses as they are service based and funded through taxes.
Nonfinancial controls, such as those related to employee satisfaction, customer service, and so on, are an important and increasingly applied form of organizational control.
Understanding the Benefits of Non-Financial Goals
Non-financial goals can also help you to develop important skills such as problem-solving, communication, and time management. These skills can be applied to any situation, and can help you to become more successful in both your personal and professional life.
- Loans.
- Credit facilities.
- Retirement planning.
- Education funding.
- Underwriting stocks and shares.
- Money market trading.
- TFCs (Term Finance Certificates)
- Wealth management.
Non-financial objectives, such as those revolving around customer loyalty, employee welfare, labor productivity and production volume also matter. These factors have a direct impact on your company's performance and revenue.
Financial objectives are usually quantifiable and measurable, such as reducing costs, increasing revenues, or optimizing returns. Non-financial objectives are more qualitative and subjective, such as enhancing employee satisfaction, improving customer experience, or supporting social causes.
/ˌnɑːn.faɪˈnæn.ʃəl/ /ˌnɑːn.fɪˈnæn.ʃəl/ Add to word list Add to word list. not relating to money or how money is managed: Non-financial incentives have proven much less effective than financial ones. Couples also consider non-financial factors when deciding on when to retire.
The financial account is the account of Financial Assets (such as loans, shares, or pension funds). The non-financial account deals with all the transactions that are not in financial assets, such as Output, Tax, Consumer Spending and Investment in Fixed Assets.
What are non-financial factors?
They may include environmental, social, ethical, strategic, or competitive considerations that may have a positive or negative impact on the company's performance, reputation, or stakeholders.
Examples: number of hotel rooms, tones of coal, number of clients serviced etc. These non-financial quantities do not appear on the financial reports. However they can be used to calculate the budgets as they are drivers linking planned activities to financial results.
Determining your future needs in terms of investment, resources, funds. Determining the sources of funds. Managing or utilizing these funds efficiently. Identifying risks and issues in the plan.
- Profit maximisation.
- Mobilisation of finance in a proper way.
- Ensuring the company's survival.
- Maintaining proper coordination with other departments.
- Lowering the cost of capital.
Financial aims and objectives cover: Business survival is a very common objective for a small business or during hard economic times. Business survival refers to keeping the business operating for a certain amount of time. Most businesses initially aim to survive their first year.
