What is Relevant Cost? A relevant cost is a cost that differs between alternatives in a decision and will affect the future cash flows of a business. It is a…

Introduction While financial metrics like profit, cash flow, and ROI remain central to business decision-making, ethical and non-financial considerations are now recognized as essential to building sustainable, trustworthy, and successful…

Introduction Activity-Based Costing (ABC) is a refined costing approach that allocates overheads and indirect costs to products, services, or processes based on the activities they consume. In decision-making, ABC gives…

Introduction Cost-Volume-Profit (CVP) analysis is a powerful financial tool that connects the dots between costs, sales volume, and profits. It helps businesses answer key questions: How many units must be…

Risk analysis isn’t just theory—it’s an everyday reality that keeps banks safe and sound. Here’s a simple breakdown of how banks do risk analysis in practice, with useful tools and…

Making capital investment decisions in banking isn’t always straightforward. Risks and uncertainties—like economic changes, new regulations, or shifting customer behavior—can all impact whether a project delivers the expected returns. So,…

Capital budgeting is about more than just picking the best investment—it’s about managing the risks that come with those decisions. For banks, smart risk management in capital budgeting protects your…

Capital budgeting—it’s a term you hear all the time in banking and finance circles, but what does it really mean for your bottom line? At its heart, it’s all about…