Financial Management Report

FINANCIAL
MANAGEMENT REPORT

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY ..................................................................................................................................3
Meaning of financial management...............................................................................................3
Importance of financial functions within the organisations.........................................................3
Role of the financial manager in a company...............................................................................4
Sources of finance........................................................................................................................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................1

INTRODUCTION
Financial management is a big term in which we study about the term finances. There are
various sources of finance which is available to the company in order to raise the fund from the
market. This report will state the term of financial management along with the importance of
financial functions within the company. This report will also state the role of the financial
manager in the company. In this report we will study about the various source of the finance
available to business to form a company's capital structure in order to start and run the business.
This report will also state the formula of different sources of finance along with their
calculations.
MAIN BODY
Meaning of financial management
Financial management is a wide term in which we study about the three financial
decision i.e. investment decision, financial decision, dividend decision. (Shapiro and Hanouna,
2019)Financial management is a process of planning, collecting, directing and controlling the
financial activities of the company such as acquiring of fund, utilization of fund and profit &
wealth increasing.
Importance of financial functions within the organisations
Finance function includes the decision related to procurement of fund and utilization of
fund. The finance function is classified into three sources such as long term finance, medium
term finance and short term finance.(Siminica, Motoi and Dumitru, 2017) The importance of
financial function within the company are:
 Identify needs of finance: Every company needs money in order to start the business.
This state the initial capital requirement of the company to start the business. So the
finance function become important in order to identify how much fund is required to raise
from the market.
 Identify sources of finance: There are various of finance sources are available in the
market such as equity, debt, preference, bonds, bank loan, overdraft etc. on the basis of
their short, medium and long term. So the finance function includes identify the best
sources of finance.
 Comparison of various sources: After identifying the sources of finance the most
important finance function is to compare those sources and select the best source out of