A Study On Financial Management Of A Petroleum Sales Company

China National Petroleum Corporation (CNPC) is a largest petrochemical corporation formed from the original China National petroleum parent corporation in accordance with the industrial reform plan of the State Council in July1998. It is a state-authorized investment institution and state-controlled integrated petroleum company operating with a modern enterprise system and integrating upstream and downstream operations, domestic and foreign trade, production and marketing in various industries and countries. As its largest subsidiary, PetroChina Company Limited has successfully listed in Hong Kong and New York in April2000. At present, a new development strategy of "Building a large cross-border state-owned conglomerate with an international competitiveness’" is implemented throughout the CNPC, so as to accelerate two shifts, that is, a shift from a domestic petroleum company to a multinational petroleum company, and a shift from "an oil and gas producer" to’’an oil and gas supplier with multiple functions". To reach this strategic goal of the CNPC, corresponding reform has been conducted to the CNPC’s financial management as well.Petroleum Marketing Company A, a subordinate company of PetroChina Company Limited, failed to implement a comprehensive reform in its financial management, which leaves problems in such aspects as financial management system, financial personal ideology and quality unresolved. As the largest petroleum marketing company in regional A, Petroleum Marketing Company A plays an important role in regional economic development. Therefore, resolving its financial management problems is an important way to promote local economic development.The article has conducted an intensive research on Petroleum Marketing Company A’s financial management on the basis of applying financial management theories, relevant information theories, performance management, and the theory of economics of scale to the Company. Research results show the following problems exist in the present financial management of the Company:lack of working initiative among financial personnel; no clear division of powers and duties among managers, the necessity of quality improvement among basic-level financial personnel, imperfection of organizational form and system in financial management, increasing risks in capital management caused by unhealthy rapid scale expansion, and the failure to keep its financial management concepts updated in accordance with market changes. By comparing the financial management systems of large domestic and foreign petroleum companies, this article has found a reference for Petroleum Marketing Company A and proposed some countermeasures to improve the Company’s financial management system. The measures are:to establish an appropriate incentive mechanism, implement a clear division of power and duties at all levels of company financial management, provide systemic business training for its financial basic-level personnel, improve company financial environment and management rules and regulations, enhance its financial risk control and avoidance capabilities, and establish new financial concepts to meet the requirements of market-oriented economy.