Financial management : it is a specialized functional field, dealing with the management of finance right from estimation and procurement till its effective utilization in the business. It is an area looked after by the finance manager who deals with the following issues:
i). Which new proposals for employing capital should be accepted by the firm ?
ii). How much working capital will be needed to support the firm's operations ?
iii). Where should the firm go to raise long term capital and how much will it cost ?
iv). Should the firm declare dividend on its equity capital and if so, how large a dividend should be declared ?
v). What steps can be taken to increase the value of firm's equity capital?
The above issues are solved by taking three major decisions (1) Investment decision (2) Financing decision (3) Dividend decision. As objective of the Financial Management is to maximize the value (i.e. wealth of shareholders). the firm should strive for an optimal combination of the there interrelated decisions solved jointly .The decisions to invest in a new capital project, for example, necessities financing the investment. The financing decisions in turn, influences and is influenced by the dividend decision. The retained earnings used in internal financing represents dividends foregone by the shareholders. With a proper conceptual frame work, joint decisions that tend to be optimal can be reached .
1) Financial management is a process to :
Estimate the requirement of fund
How to arrange the fund
How to invest or utilised
2) It is the efficient managment of the financial assets is known as the financial management. Its objectives are the maximization of wealth and profit maximization.
i). Which new proposals for employing capital should be accepted by the firm ?
ii). How much working capital will be needed to support the firm's operations ?
iii). Where should the firm go to raise long term capital and how much will it cost ?
iv). Should the firm declare dividend on its equity capital and if so, how large a dividend should be declared ?
v). What steps can be taken to increase the value of firm's equity capital?
The above issues are solved by taking three major decisions (1) Investment decision (2) Financing decision (3) Dividend decision. As objective of the Financial Management is to maximize the value (i.e. wealth of shareholders). the firm should strive for an optimal combination of the there interrelated decisions solved jointly .The decisions to invest in a new capital project, for example, necessities financing the investment. The financing decisions in turn, influences and is influenced by the dividend decision. The retained earnings used in internal financing represents dividends foregone by the shareholders. With a proper conceptual frame work, joint decisions that tend to be optimal can be reached .
1) Financial management is a process to :
Estimate the requirement of fund
How to arrange the fund
How to invest or utilised
2) It is the efficient managment of the financial assets is known as the financial management. Its objectives are the maximization of wealth and profit maximization.
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FINANCIAL TOOLS
Financial tools are the techniques that can be employed by the finance manager to solve the problem properly effectively and efficiently. The following are the financial tools:
1) Ratio analysis
2) Fund flow and cash flow analysis
3) Cash budget
4) ABC analysis
5) EOQ model
6) Ageing schedule
7) Projected financial statements
8) Long - term investment appraisal tools - pay back period, net present value, profitability index internal rate of return. etc.
9) Cost of capital
10) Leverages
11) Hedging
These tools help the management in decision making.
Financial tools are the techniques that can be employed by the finance manager to solve the problem properly effectively and efficiently. The following are the financial tools:
1) Ratio analysis
2) Fund flow and cash flow analysis
3) Cash budget
4) ABC analysis
5) EOQ model
6) Ageing schedule
7) Projected financial statements
8) Long - term investment appraisal tools - pay back period, net present value, profitability index internal rate of return. etc.
9) Cost of capital
10) Leverages
11) Hedging
These tools help the management in decision making.
2 comments:
Here is Mr Benjamin contact Email details,lfdsloans@outlook.com. / lfdsloans@lemeridianfds.com Or Whatsapp +1 989-394-3740 that helped me with loan of 90,000.00 Euros to startup my business and I'm very grateful,It was really hard on me here trying to make a way as a single mother things hasn't be easy with me but with the help of Le_Meridian put smile on my face as i watch my business growing stronger and expanding as well.I know you may surprise why me putting things like this here but i really have to express my gratitude so anyone seeking for financial help or going through hardship with there business or want to startup business project can see to this and have hope of getting out of the hardship..Thank You.
I could not have closed on my first home without Mr, Pedro ! Pedro and his team went above and beyond for me on this transaction. He handled my very tight turn around time with ease and was always available for me when I had questions (and I had plenty), even when he was away from the office, which I greatly appreciated! He and his team handled many last-minute scrambles with the seller and worked tirelessly to make sure that I could close before my lease (and my down payment assistance, for that matter) expired. Mr Pedro is an incredibly knowledgeable Loan Officer, courteous, and patient. I went through a couple offers on properties before my final purchase and Pedro was there to help with each one, often coordinating with my agent behind the scenes. I felt supported throughout the entire process. Thanks to Pedro and the tireless efforts of his team, I am now a proud homeowner! I would encourage you to consider Pedro and his loan company for any kind of loan.
Mr, Pedro Loan Offer
Email- pedroloanss@gmail.com.
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