Father Saturnino Urios University

College Department
S.Y. 2016-2017
Second Semester

STRATEGIC FINANCIAL PLANNING AFFECTING FINANCIAL ISSUES

IN PRIVATE SECTORS

Submitted To:
Mrs. Hannah Dara V. Garay Nugroho
Good Governance and Social Responsibility Adviser

Submitted By:

Darl Quennie Burnea

Mart Christian Calo
Telesa Shena Dagani
Yandle Dungao
Honey Grace Galve
Princess Magpatoc
Jessa Marie Mapula
Jezl Morillo
Nikki Peggy
Stephenny Villanueva

AT36
February 7, 2017
 Chapter I
Introduction

In the corporate world, private sectors are deemed

disadvantageous than public sectors because it suffers from
certain limitations. Such limitations are; Lack of
transferability of shares, Poor protection to members, No
valuation of investment, Lack of public confidence and most of
all smaller resources.

The research paper focuses on investigating the financial

issues private sectors face in the course of their operational
and financial transactions and to give emphasis to the
importance of Strategic Financial Planning.

Financial Planning is an ongoing process that helps an

entity to make sensible decisions about money to achieve
financial goals. It is a comprehensive evaluation of an
individual's current pay and future financial state. Thus, it
is vital to a company to engage in proper financial planning.

Rationale

This study is conducted to examine the financial issues

in L Orongan Enterprises, Soundcheck, CENTRO, MAXIE AUTO PARTS
SUPPLY and Zillovia Plywood Corporation in terms of their
Financial Planning strategies. This study contains the recent
and current financial problems of particular entities. Along
with this are the proposed solutions and other alternatives of
the researchers. Furthermore, the study gives other entities a
guide of how to deal with their transparency issues and how to
convert those challenges into a positive instrument in their
company. This study could also be used as a tool of other
small business entities and other flourishing companies who
have been struggling with their financial planning.
Statement of the Problem

Private sectors suffer many limitations when it

comes to operating their business several methods have been
proposed in order to combat these problems. This proposed
research aspires to explore financial issues in private
entities. To do this, the researcher will carry out a full
financial analysis and use it to propose appropriate solutions
and recommendations.

Objectives

Identify the issues and problems of the

entities financial planning.
Compare and contrast the information gathered
from respective entities.
Review and examine appropriate solutions and
recommendation for improvement and alteration for
financial planning of the entities.

Significance of the Study

This study will be significant in the awareness of

financial issues surrounding private sectors with regards to
their financial issues and to provide solutions or
recommendations in solving the said issues. This will
contribute to the involvement of students, employees, the
community and particularly the readers of this study by
developing the financial factors affecting the organization
mainly in the private sectors. Also, to help ascertain an
organizations method to cope-up with present financial issues
with governance as the pair basis.
 Moreover, this will serve as future reference of
financial issues circulating in the time of this research for
educational purpose and business use.

Operationalization of Terms

Aging of accounts - An accounts receivable aging is a

report that lists unpaid customer invoices and unused credit
memos by date ranges. The aging report is the primary tool
used by collections personnel to determine which invoices are
overdue for payment. Given its use as a collection tool, the
report may be configured to also contain contact information
for each customer. The report is also used by management, to
determine the effectiveness of the credit and collections
functions.

Credit line A line of credit, abbreviated as LOC, is an

arrangement between a financial instuition, usually a bank,
and a customer that establishes a maximum loan balance that
the lender permits the borrower to access or maintain. The
borrower can access funds from the line of credit at any time,
as long as he does not exceed the maximum amount set in the
agreement and as long as he meets any other requirements set
by the financial institution, such as making timely minimum
payments.

DELINQUENCY illegal or unacceptable behavior of a

manager.

ROI (Return of Accounts) - measures the gain or loss

generated on an investment relative to the amount of money
invested. ROI is usually expressed as a percentage and is
typically used for personal financial decisions, to compare a
company's profitability or to compare the efficiency of
different investments.
 Right Hand - the person who acts as a chief assistant and
helps and supports the manager a lot in their work.

SOLE PROPRIETOR - Sole owner of a business; a self-

employed. He or she directs the affairs of the enterprise,
bears its risks and losses, and takes the profits and
benefits. Also called sole trader.

SOLE PROPRIETORSHIP - the simplest business form under

which one can operate a business. The sole proprietorship is
not a legal entity. It simply refers to a person who owns the
business and is personally responsible for its debts.

Strategic Financial Planning - the task/process of

determining how a business will afford to achieve its
strategic goals and objectives.

Tax planning - is the analysis of a financial situation

or plan from a tax perspective. The purpose of tax planning is
to ensure tax efficiency, with the elements of the financial
plan working together in the most tax-efficient manner
possible. Tax planning is an important part of a financial
plan, as reducing tax liability and maximizing eligibility to
contribute to retirement plans are both crucial for success.
 Chapter II

Theoretical Background

Review of Related Literature

This chapter includes ideas, finished thesis,
generalizations or conclusions, mythologists and others. Those
that were included in this chapter helps in familiarizing
information that are relevant and similar to the present
study.
Related Literature
Retirement counselors, financial service professionals,
and retirement intervention specialists routinely emphasize
the importance of developing clear goals for the future;
however, few empirical studies have focused on the benefits of
retirement goal setting. In the present study, the extent to
which goal clarity and financial planning activities predict
retirement savings practices was examined among 100 working
adults. Path analysis techniques were used to test two
competing models, both of which were designed to predict
savings contributions. Findings provide support for the model
in which retirement goal clarity is a significant predictor of
planning practices, and planning, in turn, predicts savings
tendencies. Two demographic variablesincome and agewere also
revealed to be important elements of the model, with income
accounting for roughly half of the explained variance in
savings contributions. The results of this study have
implications for the development of age-based models of
planning, as well as implications for retirement counselors
and financial planners who advise workers on long-term saving
strategies. (R.Stawski, D.Hershey& J. Jacobs-Lawson, 2007)
A study explored the extent to which individuals
knowledge of retirement planning, future time perspective, and
financial risk tolerance influenced retire savings practice.
A total of 270 young working adults articipated in the study.
Regression analyses that each variables is predictive of
saving practices, and they ineract with each other again as
well. From an applied perspective the finding suggest that
counselling and intervention efforts aimed at promoting
retirement saving should differentially target individuals on
the basin of these three psychological dimensions. .
(D.Hershey& J. Jacobs-Lawson, 2007)
 According to Robert Bushman and Abbie Smith audited
financial statements along with supporting disclosures form
the foundation of the firm-specific information set available
to investors and regulators. In its paper, the authors discuss
economics-based research focused on the properties of
accounting systems and the surrounding institutional
environment important to effective governance of firms. They
provide a framework for understanding the operation of
accounting information in an economy, discuss a broad range of
important research findings, present a conceptual framework
for characterizing and measuring corporate transparency at the
country level, and isolate a number of future research
possibilities.
Firm value is influenced in many direct and indirect ways
by financial risks which consist in unexpected changes of
foreign exchange rates, interest rates and commodity prices.
The fact that a significant number of corporations are
committing resources to risk management activities, however,
represents only an indication for the potential of corporate
risk management to increase firm value. This paper presents a
comprehensive review of positive theories and their empirical
evidence regarding the contribution of corporate risk
management to shareholder value. It is argued that because of
realistic capital market imperfections, such as agency costs,
transaction costs, taxes, and increasing costs of external
financing, risk management on the firm level represents a
means to increase firm value to the benefit of the
shareholders. (Shnke M. Bartram,2000)
Little is known about the psychological mechanisms that
underlie financial planning for retirement. Most studies of
financial planning and investing have used demographic
indicators (e.g., age, gender, income) to predict individual
differences in saving. In the present study, a model of
planning is tested in which psychological indicators (future
time perspective, retirement goal clarity, and self-rated
financial knowledge) are posited to mediate the relationship
between demographic indicators and saving behaviors. Path-
analytic techniques were used to test the model, based on data
from 265 middle-aged working adults. Analyses revealed
substantial support for the role of psychological factors in
the retirement planning process. Findings have theoretical
implications for the development of psychologically based
models of planning, as well as applied implications for those
who seek to understand the psychomotivational forces that
underlie tendencies to plan and save. (Hershey, D.A., Jacobs-
Lawson, J.M., McArdle, J.J. et al. J Adult Dev (2007) ,
 The researchers teat whether banks investment and
financing policies can be explained by tax status. They
document changes in bank holdings of municipal bonds in
response to changes in tax rules relating to deductibility of
interest expense. They also document an association between
banks marginal tax rates and their investment and financing
decisions, which is consistent with the existence of tax
clienteles. However, banks do not sort themselves perfectly
into investment and financing clienteles because of adjustment
costs. They posit specific types of transaction-cost
impediments to tax planning, and document that banks
apparently trade off these costs against tax-planning benefits
(M. Scholes, G.Wilson and M. Wolfson, 2015)
A study developed a general framework for analyzing
corporate risk management policies. They begun by observing
that if external sources of finance are more costly to
corporations than internally generated funds, there will
typically be a benefit to hedging: hedging adds value to the
extent that it helps ensure that a corporation has sufficient
internal funds available to take advantage of attractive
investment opportunities. They then argue that this simple
observation has wide ranging implications for the design of
risk management strategies. They delineate how these
strategies should depend on such factors as shocks to
investment and financing opportunities. They also discuss
exchange rate hedging strategies for multinationals, as well
as strategies involving nonlinear instruments like options
(K. FROOT, D. SCHARFSTEIN and J, STEIN, 1993).
This article examines a new database that details
corporate risk management activity in the North American gold
mining industry. I find little empirical support for the
predictive power of theories that view risk management as a
means to maximize shareholder value. However, firms whose
managers hold more options manage less gold price risk, and
firms whose managers hold more stock manage more gold price
risk, suggesting that managerial risk aversion may affect
corporate risk management policy. Further, risk management is
negatively associated with the tenure of firms' CFOs, perhaps
reflecting managerial interests, skills, or preferences
(TUFANO, 1998),
People studies the hedging policies of oil and gas
producers between 1992 and 1994. My evidence shows that the
extent of hedging is related to financing costs. In
particular, companies with greater financial leverage manage
price risks more extensively. My evidence also shows that the
likelihood of hedging is related to economies of scale in
hedging costs and to the basis risk associated with hedging
instruments. Larger companies and companies whose production
is located primarily in regions where prices have a high
correlation with the prices on which exchange-traded
derivatives are based are more likely to manage risks
(Haushalter,2000).
A paper provides clear evidence of substantial tax
effects on the choice between issuing debt or equity; most
studies fail to find significant effects. The relationship
between tax shields and debt policy is clarified. Other papers
miss the fact that most tax shields have a negligible effect
on the marginal tax rate for most firms. New predictions are
strongly supported by an empirical analysis; the method is to
study incremental financing decisions using discrete choice
analysis. Previous researchers examined debt/equity ratios,
but tests based on incremental decisions should have greater
power (MacKIE-MASON,1990).

Synthesis

The related literature tackles about the importance of

financial strategies and planning to aid and prevent problems
when financial issues arise. It specifically talks about how
an entity applies transparency and how it affects its business
operation. Further, the inevitability of risks and expenses
are also contributors of financial issues which should be
addressed by having a strategic financial planning.

For many business owners, planning is often put aside for

more immediate operational issues that are at hand. This is
particularly common when businesses are in rapid growth phases
and resources are stretched. The financial components of a
business plan provide the larger plan with a solid foundation.
The numbers provide financial benchmarks for the operation of
the company, making sure the objectives set are achievable.
This provides measurement points by which management can
determine progress is on track. A sound financial plan also
helps to set performance targets for the organization, and
provides a framework for rewarding staff.

Private sectors can have issues on how to allocate and

utilize their funds, and issues on how to disclose its
information to the stakeholders. If a private sector succeed
in disclosing the information to the stakeholders and is
properly governing their finances, it will serve as an output
in which they will be able to gain the trust and confidence of
the stakeholders, thus providing higher chances to become
successful.

Private sectors experienced a lot of planning and

decision making on how to manage their funds. From their
experiences, they will be able to learn which enable them to
grow and develop.
Conceptual Framework

Strategic
Financial Planning

Set standards for managerial

level positions to ensure
committed and professional
employees/managers to properly
Financial carry on the business.
Issues Evaluate and train employees to
be in a way that they may seem
fit for the designated
positions.

Consistent and effective

monitoring to ensure compliance
to applied policies.
This requires non-disclosure
agreement or financial
confidentiality agreement.
The best option for an owner
concerned about confidentiality.
Snapshot could contain only gross
sales, gross profit and actual
Transparency cost incurred for a few years.
In every decision made encourage
employee to give their feedback
for them to know their involvement
in the business and boost
productivity and morals.
With respect to Social Contract
Theory, aside from the main goal
to gain profit always instill
customer value in the workplace.
Through a game plan everyday or in
its risk or planning management.
 Review the past trends &
businesses statements to help
pre-determine upcoming events
and lessen the risk and plan
solution before it happens.
Secure a substitute for manual
Risk resources accounted for. Input
Management information to computer for
security and easy access.
Estimate for upcoming events to
pre-determine ready-to-release
emergency/contingency funds to
divert from the business or
owners over revenue.

Match estimated tax payments

with actual income rather than
over-withholding maximize the
use of appropriate deductions.
Tax Planning Engaging to CSR through giving
back to society by sustaining
relationship to diocesan
instructions for tax planning
purpose.
 Retirement Retirement Plan Services
Planning Third-party Administrative
Services

Hypothesis

The researchers were guided to test the effectiveness of

strategic financial planning by the use of these two
hypotheses:

HO: Strategic financial planning will help solve present

financial issues and forecast future financial crisis.

HA: Strategic financial planning alone will not help solve

present issues and forecast future financial crisis.

Chapter III

Methodology

Design

This research paper is designed to give information and

possible solution about the issues concerning financial
planning to the business entities, the students, the
employees, and the community. This paper is significant to the
business entities because it helps in their financial planning
and strengthens their financial management. The students can
gain knowledge about how financial related things are managed
efficiently. This paper is important to the employees in order
to ensure accountability and transparency in the workplace.
The researchers used qualitative method for this is the most
appropriate means of evaluating the issues if financial
planning in private sectors and its implication to
transparency, tax planning, risk management, and retirement
planning through conducting interviews to the private
companies. The research paper also contains Financial
Statements from the two business entities that are significant
to the study.

Criteria

This paper contained data that are gathered from reliable

authors and articles from the website. The data used are up to
date and associated with the research. Five private entities
that are located in Butuan City were selected as the key to
gather data and to be interviewed. The interview questions are
created on the objective of the research.

Method of Analysis

This research gathered data through the personal

interview method through interviews asking relevant questions.
Three sole proprietors and two head managers in Butuan City
were the interviewee of this research. The private proprietors
of L Orongan Enterprises, Soundcheck and MAXIE Auto Parts
Supply and the head managers of CENTRO and Zillovia Plywood
Corporation were interviewed and the required information and
data for this research was gathered. The questions were
created by the researchers.

Flow of Research

1. The leader gathered the members and conducted a thorough

discussion about the topic.

2. Developed a research question from an idea, observation

and preliminary research.
 3. The researchers looked for five private sectors in which
they performed an interview.

4. The interviews were conducted verbally

5. Used electronic devices to record the interview with the

full knowledge and permission from the interviewee.

6. Each researcher was assigned specific chapters to write

by the leader.

7. Analysis was done through the use of reliable and

credible sources.

Chapter IV

Results and Interpretation

Results

L ORONGAN ENTERPRISES
 L Orangan Enterprises is a home appliance
distributor/dealer it started with zero capital since the
business was granted an opportunity to start his business by
ordering his stocks on full credit. The entity has grown and
has branches in Cagayan and other local areas in Mindanao.

The owner treats himself as an employee of the

establishment rather than the owner however he does not assign
specific salaries to himself. The owner and his wife share the
power as a manager. Their Financial Statements are open to
their employees and even encourages employees to participate
in decision making.

Their financial and operational transactions like

acquiring new resources are accounted manually from the
beginning of their business up until the present except for
their accounts receivable, they use computer systems through
Aging of Accounts to monitor the balances of their debtors.

The proprietor experienced a risky decision when he

opened a credit line worth P 1000, 000 in Allied Bank to fully
develop his business. It was a dilemma he encountered because
of the risk in obtaining the debt with no assurance of being
able to pay it. However, the owner considered the risk as
something than can be calculated beforehand. As a result, the
funds they have secured helped them push their business
through. Currently, the entity no longer has debts to the
bank.

The proprietor also encountered uncontrollable expenses

due to a car accident happened to his employees while doing
their daily operation. Due to this fortuitous event they spent
almost P18,000 of their operational funds in order to pay for
the damages and hospitalization of those who were affected.
Further, unforeseeable event such as natural calamities and
flooding causes delay of payments from their debtors
especially those who are residing in flood-prone areas
affecting operational transactions to the entity.

The entity is always on time in giving the employees

salaries and wages they even grant cash advances and also let
their employees decide if they want to spend their separation
fees. They also grant educational support to the families of
their workers.

The entity does not have any tax planning strategies in

order to help keep their taxes as low as the law allows.

The proprietor has secured insurances in Pag-ibig, SSS

and other government insurance companies.

SOUNDCHECK

Soundcheck is a sole proprietorship engaged in lights and

sound system rentals and services in any event like fiestas,
birthdays and other occasions. The proprietor started the
business when he was in college however he has been involved
in this form of business since high school.

As a service provider the entity applies the principle of

transparency through openly providing his customers full
knowledge of how they deliver their services.

The nature of their business requires skillful and

talented workers; the owner trains his employees and even
sends them to seminars with full expenses paid in Manila.
Unfortunately, some of his employees were being pirated by
competitors.
 In terms of decision making he has selected few employees
whom he allows to participate. There are also times when he
lets his crew/employees handle an event without him giving his
full trust to them.

The entity also accounts its transactions manually but

plans to engage in accounting software soon since they are
also planning an expansion.

The entity uses the demand of its customers as a basis in

their investing decisions with regards to purchasing new
equipment. However, they encountered a risky investment
decision when they purchased expensive equipment but
unfortunately the ROI of it was not promising because the
customers in the area couldnt afford the rate of the said
equipment. As a result, although the equipment was known to be
useful in delivering better services for customers it cannot
be considered as a demand since the customers are not willing
and able to rent the particular equipment.

The entitys uncontrollable expenses are in cases when

some of their equipment is damaged or lost. Whenever the
damages and loss is due to an employees negligence the
expense is deducted to their salary/wage but if in case of
fortuitous event it is deducted in his personal asset.

Moreover, the proprietor sometimes uses his personal

asset especially when they are dealing with clients who are
organizing an event for church purposes. They give discounts
to these kinds of events thus the income they earn are
sufficiently enough to pay for operational expense and no
profits gained.

The salary/wages of the employees are sometimes delayed

because since it is a service based business whenever their
client/customer does not pay on time the salary/wages of
employees are also delayed.

The proprietor has a book keeper who manages his

transactions. He does not engage in any strategic tax
planning.

The proprietor has secured insurances in AXA and pacific

cross, SSS, Pag-ibig and even pays full insurance for his crew
without deducting his employees salaries/wages.

CENTRO

Centro is a local daily newspaper in Caraga Region under

Johnmin publishing. It is a sole proprietorship in form but
partnership in nature because of the agreement between the
owner John Min and the editor in chief Mark David Bequilla.

The editor in chief holds a meeting where he presents the

financial statements of the company in order for them to
evaluate the status of their operations.

The uncontrollable expenses that the firm occasionally

face are the bails that the entity pays to release their
journalists/reporters from being arrested this is due to
writing a false article about an issue.

The entity did not disclose its tax planning strategy. It

has SSS as retirement plan for their employees.

MAXIE AUTO PARTS SUPPLY

The entity is a sole-proprietorship and was formerly

known as Love Auto Supply it has begun operating since 2001.
It changed its name on 2011 for marketing strategies. They
offer brand new and Japan surplus, auto parts, machineries for
vehicles and car repair services.

The proprietor has a right hand that he gives his full

trust and confidence in handling the business transactions up
to the most confidential accounts but in terms of decision
making he does not let his employees participate.

The entity accounts their transactions manually. They

dont have regular inventory check as a result their stocks
remain outdated and could not cater to the needs of customers
because they are focused more in car repair services.

The entity did not disclose their tax planning

strategies. its retirement plan for their employees includes
Pag-ibig, SSS and Philhealth

ZILLOVIA PLYWOOD CORPORATION

The entity is a plywood manufacturer however their branch

located at Talacogon Agusan Del Sur has stopped operating
since 2015 due to the total log ban the DENR implemented. As a
result the branch was forced to close. Other branches located
in other areas are still active however they are now engaged
in exportation of raw materials to manufacture their products.

Before the log ban happened the entity was already facing
financial issues due to the managers delinquency. He accepted
under-the-table transactions for them to obtain many
suppliers. The misconduct of the manager made a huge impact to
the corporations reputation that it affected their operations
which resulted to poor production and decrease of profits. A
new management was then admitted however the new manager was
not able to fully save the business because the log ban took
place.
 The entity both had manual accounting and accounting
software to keep track of their financial and operational
transactions.

The specific branch disclosed that they had tax planning

strategies but did not specify.

The retirement plans of the entity for the employees consist

of Pag-ibig and SSS.

Interpretation

After a thorough analysis the researchers determined four

financial issues that were common in all of the five entities
financial governance.

From the four entities they were transparent with their

financial statements to their employees to the extent that
competitors are able to infiltrate their transactions as a
result its competitors pirated his resources in terms of labor
thus, his investment in sending his employees to seminars and
trainings did not return to him but its his competitors who
benefited from it. On the other hand, there is also a negative
effect when there is a lack of transparency because managerial
misconduct will happen. To address this issues a strategic
financial planning should be applied by setting standards for
managerial level positions as well as the employees. A
fiduciary relationship between managers and employees must be
developed in order obtain loyalty and protect the company from
privacy issues.

From the five entities there was an issue with regards to

controlling their expenses and inaccurate forecasting of
demands which resulted to uncontrollable expenses and
liabilities that compromised the owners personal asset. With
strategic financial planning the entities would be able to
avoid or reduce financial risks by reviewing the past trends
and businesses statements to assess the situations and
forecast upcoming expenses.

The five entities does not engage in strategic tax

planning which leads to a high tax payable expense when in
reality they could have resorted to legal tax planning in
order to maximize their profits. There are many ways to lessen
taxes that are legal such as matching estimated tax payments
with actual income rather than over-withholding maximize the
use of appropriate deductions and engaging to CSR through
giving back to society by sustaining relationship to diocesan
instructions for tax planning purpose.

Their retirement plans are present however they did not

secure fire insurance and safety precautions for future
natural calamities which an entity should engage in for the
sustainability of the life of the business. There are Third-
party Administrative Services that a business can acquire.
 L Orongan Enterprises and Maxie Auto Parts Supply
disclosed a copy of their Financial Statements.

In L Orongans financial statement it can be assessed

that the accuracy is reliably certain because it was audited
by a certified public accountant.

In Maxie Auto Parts Supply may be questioned regarding

the presentation of their financial statements. The entity may
be able to improve their financial statements to make it
reliable.

Both entities provided their financial statement as an

act of honesty and transparency.
 Chapter V
Summary, Conclusions and Recommendations

Summary

Generally, Investments are the lifeblood of an entity. To

assure the continuance of such, financial planning is
absolutely needed, as a task that determines how a business
will afford its strategic goals and objectives.

Several companies have been interviewed by the

researchers. Those companies provides retirement plan to their
employees but only L Orongan Enterprises has secured
insurance. As such, fortuitous events such as car accident and
natural calamities like flood may lead to unexpected expenses
that cause a delay on wages of the employees. L Orongan
Enterprises, Soundcheck and CENTRO doesnt have tax planning
strategy while Maxie Auto Parts Supply and Zillovia Plywood
Corporation is said to have a tax planning strategy but dont
have the intention of disclosing it. Moreover, all those
companies were using manual accounting system and some of them
were partly using computerized accounting system as well.

Furthermore, some of the companies interviewed by the

researchers have different basis in terms of their investment
as well as how they managed the issues concerning financial
stability. Other depends on the demand of their customer while
some commits unethical behavior such as accepting under the
table transactions. But that does not give the company the
guarantee of bigger profit. Not many has the courage to take
risk of borrowing a lot of money to sustain a business but
with a right financial planning, it can be pay in no time and
continue the business debt free.

Due to poor management, employee suffers the aftermath.

Due to misconduct behavior, a branch company loses its ability
to continue so it closes. As well as transparency, excluding
Zillovia Plywood Corporation because they dont have
transparency - though it is good but too much is not better.

Conclusions

The researchers concluded that Strategic financial

planning alone will not help solve present financial issues
and forecast future financial crisis because there are many
factors that can affect a business financial stability.

The researchers concluded that no matter what kind of

business and how big or small it is; it will face common
financial problems generated by four factors: transparency,
risk management, tax planning and retirement planning. Thus,
strategic financial planning is essential not just for the
maximization of profits but rather for the succession of the
business especially for the benefit of the employees.
 Although the solutions stated in this study seems to be
costly and complex and deemed unnecessary by many, it is
however vital because the effects will certainly generate good
results in the future.

Recommendations

As the world advances and many businesses arises so as

the threats to the financial stability of the entity.
Furthermore, a profitable and successful business does not
always directly translate into successfully building the
personal wealth because basically, the business is not only
created to generate wealth for the owner alone it is for the
betterment of its stakeholders; the employees, environment and
the society.

Thus, the researchers recommend for further elaboration

of this study and a deep investigation on the factors that
affects the financial management of private sectors because
there are many financial planning strategies an entity can
apply.
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http://lib.mdp.ac.id/ebook/Karya%20Umum/Karya%20Umum-
Strategic%20Financial%20Management.pdf
ftp://ftp.software.ibm.com/software/data/sw-
library/cognos/pdfs/blueprints/bp_ab_strategic_financial_plann
ing_forecasting.pdf