Quick Answer: What Is Financial Management Explain Its Objectives?

What are the primary objectives of financial management?

The primary objective of the financial management process is to optimize the financial and economic benefits of an investment..

What are the three main functions of financial management?

The financial manager’s responsibilities include financial planning, investing (spending money), and financing (raising money). Maximizing the value of the firm is the main goal of the financial manager, whose decisions often have long-term effects.

What is the concept of financial management?

Financial management may be defined as the area or function in an organization which is concerned with profitability, expenses, cash and credit, so that the “organization may have the means to carry out its objective as satisfactorily as possible;” the latter often defined as maximizing the value of the firm for …

What are the three types of financial management?

Financial Management takes financial decisions under three main categories namely, investment decisions, financing decisions and dividend decisions.

What are the objectives of the financial department?

The goals for a finance department can include strategic budgeting, cost containment, cash flow management, debt servicing, tax planning and accurate record keeping.Strategic Budgeting and Projecting. … Cost Containment and Purchasing Management. … Cash Flow Management. … Debt Service and Credit Use. … Proactive Tax Planning.More items…

What is the long run objective of financial management?

The long-run objective of financial management is to: maximize earnings per share.

What are the types of financial management?

The three types of financial management decisions are capital budgeting, capital structure, and working capital management. A business transaction that would include capital budgeting is if your company should open another store or not.

What is financial management and its objectives?

Answer: The primary objectives of financial management are: Attempting to reduce the cost of finance. Ensuring sufficient availability of funds. Also, dealing with the planning, organizing, and controlling of financial activities like the procurement and utilization of funds.

What are the examples of financial management?

Financial management is defined as dealing with and analyzing money and investments for a person or a business to help make business decisions. An example of financial management is the work done by an accounting department for a company.

What are the key areas of financial management?

Functional Areas of Financial ManagementDetermining Financial Needs: A finance manager is supposed to meet financial needs of the enterprise. … Selecting the Sources of Funds: … Financial Analysis and Interpretation: … Cost-Volume-Profit Analysis: … Capital Budgeting: … Working Capital Management: … Profit Planning and Control: … Dividend Policy:

What are the functions of financial management?

Financial Management FunctionsFinancial Planning and Forecasting. It is the financial manager’s responsibility to plan and estimate the business’s financial needs. … Determination of capital composition. … Fund Investment. … Maintain Proper Liquidity. … Disposal of Surplus. … Financial Controls.