FINANCIAL MANAGEMENT INTRODUCTION

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FINANCIAL MANAGEMENT

 

It’s the operational activity of the business that is concerned with obtaining and effectively utilizing funds necessary for business operation in an efficient manner. Its concerned with the managerial activities related to procurement and utilization of funds for business purposes.

 

It’s the study of:

·         How best to raise funds needed by a business organization (financing functions)

·         Allocation of funds to the most productive uses (investing functions)

·         Exercising of control over the way fund s are utilized (liquidity functions)

·         Distribution of the returns to the owner’s of the organization (profit allocation or dividend function). Finance is a branch of economics concerned with resource allocation as well as resource management, acquisition and investment. It’s the science of management of money and other assets.

 

The scope of financial management can be described by the functions of a finance manager which includes management functions and routine functions.