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Financial management is the business function concerned with profitability, expenses, cash and credit. [1] These are often grouped together under the rubric of maximizing the value of the firm for stockholders. The discipline is then tasked with the "efficient acquisition and deployment" of both short- and long-term financial resources, to ...
Jul 18, 2023 · The following are the objectives of Financial Management: Profit Maximization. Wealth Maximization. To Confirm an Adequate Supply of Funds. To Warrant Fair Returns for Shareholders. To Help in Enhancing Market Price of Shares. To Plan Optimum Funds Utilization. To Establish Safety on Investment.
The financial management is generally concerned with procurement, allocation and control of financial resources of a concern. The objectives can be-. To ensure regular and adequate supply of funds to the concern. To ensure adequate returns to the shareholders which will depend upon the earning capacity, market price of the share, expectations ...
- Profit Maximization. Profit maximisation is one of the main goals of financial management. Profitability is not just a sign of a healthy business but it also allows it to stay competitive, expand, and innovate.
- Wealth Maximization. Wealth maximisation is a more modern approach compared to profit maximisation. Profit maximisation has certain limitations such as not considering the scale of business, ignoring the time value of money, and neglecting the interests of the shareholders.
- Maintenance of Liquidity. Liquidity means how quickly and efficiently an asset can be converted to cash. For example, if you have invested in gold and want to liquidate it, you won’t have much trouble finding buyers for a fair price.
- Financial Requirements Planning. Through financial management, one can also correctly and effectively estimate the various requirements of a business such as funds needed to start or expand, contingency funds, marketing, operational expenses, working capital, and capital expenditures.
Jan 4, 2023 · Financial Management is the planning, organising, directing and controlling of the procurement and utilization of funds and safe disposal of profit to the end that individual, organizational and social objectives are accomplished. Production, marketing and finance are three important line functions of an organisation but finance is the most ...
Financial accounting is a branch of accounting concerned with the summary, analysis and reporting of financial transactions related to a business. [1] This involves the preparation of financial statements available for public use. Stockholders, suppliers, banks, employees, government agencies, business owners, and other stakeholders are ...
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Financial management ensures that a company uses its resources in the most efficient and effective way: maximizing its profit (or earnings), which ultimately increases the value of a business (its net worth or equity ). Objectives of Financial Management. Financial management deals with two things: (1) raising funds and (2) buying and using ...
