scope of financial management
DESCRIPTION
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SCOPE OF FINANCIAL
MANAGEMENT Presented by:
Nethravathilakshmi
The primary objective of a finance manager is to arrange sufficient finances in order to meet the short term long term
needs
the funds are procured at minimum costs so that the profitability of the
business is maximized
The finance manager should basically concentrate
1. Financial estimation
estimation of finance should be such that there should Neither be inadequate nor excess funds with the concern because both the situation would be dangerous for the concern
2. Planning of the capital structure
The processes involving deciding about the quantum of funds and also The type of securities to raise the funds .
The organization should choose long term debts for financing fixed assets And over drafts and cash credits should be selected for financing working Capital requirements
3. Selecting right source of funds
In market finance is available in different forms like shares ,debentures, Financial institution , commercial banks, public deposits etc
It funds are needed for short period then financial executor should choose Banks financial institutions etc
It is the responsibility of the finance manager
To allocate or invest the funds towards capital expenditure and revenue expenditure before making the final decision the profitability of each project has to be evaluated by the finance manager
Investment of funds
After the investment of funds in different investment proposal the performance of each proposal has to be measured
Analyzing the financial performance
Profit earning capacity of an organization speaks about the efficiency levels of organization
profit earning capacity enables future expansion and diversification programs of the company
It is the prime responsibility of the finance manager to plan the profit
Planning of profit
It is the another responsibility of a finance manager is to ensure liquidity of the organization as it is directly by related to the borrowing capacity of the company
Ensuring liquidity
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