Financial Management: Doc

Financial Management

Table of Contents
INTRODUCTION...........................................................................................................................1
Purpose of financial management....................................................................................................1
Three main decision from a shareholder's perspective....................................................................2
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................4

INTRODUCTION
In business world, money is consider to be the main wheel of which different business
operation depends and run smoothly. Financial management is related to the process of making
plans, organising money, controlling and monitoring all financial resources within an
organisation with a common view to attain the desired goals and maximise profit in a financial
year (Atrill, 2017).
Purpose of financial management.
In case of business scenario, the filed of finance that is related to the management and
investment in debt, equity and ratio is known as financial management. According to Guthman
and Dougal the actual meaning of financial management is operation concerned with planning,
controlling and administering of funds that can be utilised in business. Therefore, it is stated that
proper financial management would support a business firm to supply best goods to their
customer at the lowest price. The main purpose of this management is to maximise the overall
wealth of company during a time frame, proper ensure the availability of funds and resources and
make effective use of these funds in subject to upgrade functioning of business activity. It also
focuses to achieve the optimum capital structure that is making available of debenture and shares
and also ensuring the safety of funds and making of reserve in order to meet any types of future
contingencies. Nowadays the concept and focus of financial management have been moved from
financing decision making to assets management as these are also valuable part for any business
(DRURY, 2013).
In addition, the concept also relates with proper management of cash flows and in order
to take rational capital budgeting, dividend and investment judgement in nearby future. So,
financial management is generally possessed acquisition of money, allocation and control of
financial resources of an organisation. Some of the main purpose are:
 To make sure of continuous and appropriate supply of resources within a firm.
 To ensure that there are adequate return to the respective shareholder that is completely
depended upon market price of share, expectation of shareholder.
1