What is Financial Management? A business organization needs funds for activities such as trading or manufacture or to provide services. These are the core functions of any business organization. In a market economy, there are ways to raise finance through individuals and institutions from whom wealth is accumulated. This wealth is utilized properly to bring about into the market products or services. This is where financial management steps in. Optimum utilization of finance is the key for success.
Using more finances will increase the cost of the product or service. Using less finance will bring about inferior products or services. So, a balance must be struck to produce an ideal product at the least cost. The major role of financial management is acquisition of funds in the form of raising and allocation of capital, major expansion, merger, reorganization, cash management, etc.
Financial management includes concepts such as capital investment decisions, working capital management, financial risk management, etc on broad scale. Financial management deals with both long term finance and short term finance. Long term finances are those finances which are raised by a company such as equity and debt.
The money obtained from equity or debt is used to finance core activities. Short term finances on the other hand include current assets, working capital, inventory, cash, etc. With our experts to back you, you are sure to receive straight As in all your finance assignments and finance homework. Few articles written by our experts with Phd and Masters in finance: Trust HwA to understand finance assignments and finance homework better!
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