Financial Management intro.

Intro.:

 In the modern world, all the activities are concerned with the economic activities and very particular to earning profit through any venture or activities. The entire business activities are directly related with making profit

It Is Marginal Activity which is concerned with planning and controlling of the firm’s financial resources. Other words it is concerned with planning & controlling, acquiring financial & managing Assets to get the goal of organization.

Meaning:-

Financial management refers to that part of the management activity, which is concerned with the planning, & controlling of firm’s financial resources. It deals with finding out various sources for raising funds for the firm. Financial management is practiced by many corporate firms and can be called Corporation finance or Business Finance.

There 2 part of financial management :–

Funds Procurement –

            When we think rise the capital some of sources should be think some of them are as follows: Angel financing, hire purchases, Leasing, owners capital, Bank Loan, cash Credits, debentures and shares bonds.

Funds utilization-

Effective and profitable utilization of funds is very important its can be done by:

Investing in fixed assets or

Utilize them in to working capital.

SCOPE:-

The scope of financial management has undergone changes over the years. Until the

Middle of this century, its scope was limited to procurement of funds.

Estimating the Requirement of Funds:  Businesses make forecast on funds needed in both short run and long run, hence, they can improve the efficiency of funding. The estimation is based on the budget e.g. sales budget, production budget.

Determining the Capital Structure: Capital structure is how a firm finances its overall operations and growth by using different sources of funds.[3] Once the requirement of funds has estimated, the financial manager should decide the mix of debt and equity and also types of debt.

Investment Fund: A good investment plan can bring businesses huge returns.

            Objectives

                         Profit maximization

                                              Wealth /value maximization