Financial Management has wide scope. It has globally proved its significance. In India it has not much importance in the later decades. But in this rapid developing era, it has got its part in India. It has out grown its importance not only in the big industries but in the traditional thought of India society.
There was a time when parents wanted their child to take medical or engineering as profession but now they themselves are sending them in the field of the management. This change itself how management have changed it significance. In this article, Financial Management will be discussed in detail.
The wordy meaning of finance management is management of finance. This involves the planning application, organizing, directing and monitoring of economic activities in a company or an organization. Basically it means the management of finance in any firm.
Planning: This involves a strategic map made for the execution of future target. To fulfill these target one requires to make all the necessary steps, decision on papers. So, to achieve the objective of the company planning is done.
Organizing(or staffing):this involves the management and organization of the human resources as well as the non-human resources (finance). This is one of the most important function in Financial Management.
Coordinating:this involves the implantation of the planning of the objectives by making the human and the non-human resources (finance) coordinated.
Commanding(or leading): this involves the in taking of the necessary decision and the instruction at required situations.
Controlling: this function involves the checking of the work going on regularly for the fulfillment of the objective of the organization.
The finance manager concerns is the net profit distribution for Financial Management. He has to take decisions in regards to it. Net profits are divided into two:
Estimation Of Capital Requirements:
Determination of Capital Composition:
Choice Of Sources Of Funds:
Investment of Funds:
Disposal of Surplus:
We know that The Finance Manage rheas to make the net profits decision. We are here describing two ways of doing it.
Management of Cash:
The work of finance manager is not only to just plan, attain and use the funds, but he has to put a control over the expenses. This can be through following processes: