Outline the importance of Financial Management.

      

Outline the importance of Financial Management.

  

Answers


Martin
1. Financial planning
Financial management helps to determine the financial requirement of the business
concern and leads to take financial planning of the concern. Financial planning is an important part of the business concern, which helps to promote of an enterprise.

2. Acquisition of fund
Financial management involves the acquisition of required finance to the business concern. Acquiring needed fund, plays a major part of the financial management, which involves possible source of finance at minimum cost.

3. Proper use of funds
Proper use and allocation of funds leads to improve the operational efficiency of the business concern. When the finance manager uses the funds properly, they can reduce the Cost of CapitaLand increase the value of the firm.

4. Financial decision
Financial management helps to take sound financial decision in the business concern. Financial decisions will affect the entire business operation of the concern.

5. Improve profitability
Profitability of the concern purely depends on the effectiveness of proper utilization of funds by the business concern. Financial management helps to improve the profitability position of the business concern. This is with the help of strong financial control devices such as budgetary conduct, ratio analysis and cost volume profit analysis.

6. Increase the value of the firm
Financial management is very important in the field of increasing the wealth of the investors and the business concern.

7. Promoting savings
Savings are possible only when the business concern earn higher profitability and
maximize wealth. Effective financial management helps to promoting and mobilizing
individual and corporate savings.
marto answered the question on March 4, 2019 at 09:49


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