Concept and Importance of Financial Management

Financial management

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Concept of financial management...............................................................................................1
Importance of financial management..........................................................................................1
Examining the role of the financial manager in organization.....................................................2
Determining the key sources of finance......................................................................................2
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................4

INTRODUCTION
The management within the organization is useful in effectively planning, organizing,
controlling and also monitoring the key relevant business activities in a smooth way. This is
useful in coordinating various activities of the business (Karadag, 2015). The financial
management helps in analysing and dealing with the money to take necessary decision. This
report will analyse the concept and importance of the financial management. Moreover, this
study also evaluates the role of the financial manager in organization and examine the key
sources of finance.
MAIN BODY
Concept of financial management
Financial management helps in analysing and dealing with the money to take necessary
decision. The financial management is vital activity for the company. It is prominent in planning,
organizing, controlling and also monitoring the relevant financial resources to attain higher goals
and objectives of the company (Mien and Thao, 2015, July). It helps in controlling the various
financial activities like the payments, effective utilization of the fund, accounting, procurement
of fund and various other activities which are associated with the money. The financial
management is useful because it helps in ensuring adequate as well as regular supply of the funds
to various department of the company. It is useful in ensuring adequate returns to the key
stakeholders of the company. The financial management also results in optimum utilisation of
the fund and also helps in ensuring safety on the investment. The financial management helps in
planning a sound capital structure for the company and helps in maintaining balance between the
debt and equity capital (Chandra, 2020). The financial management is useful in appropriately
making the sound decision making and is useful in sound decision making of the finances. The
financial management is significant in corporate savings and maximizing the wealth of the
company.
Importance of financial management
The financial management is considered to be relevant because it helps in higher degree of
financial decision making. It helps in raising finance from various sources in order to carry out
range of business activities (Banerjee, 2015). The financial management also significant because
it helps in making investment decision as well as dividend decision which is useful for the better
operational efficiency. The relevance of the financial management is that it helps in reducing the
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