What is meant by Financial Management?
Financial Management is management of financial functions. These financial functions include how to raising of funds and how to use allocation of funds. Financial managers have an interest in determining the amount of appropriate assets from investing in various assets and selecting sources of funds to finance the assets.
Financial managers have an interest in determining the amount of appropriate assets from investing in various assets and selecting sources of funds to finance these assets. To finance these funding needs, financial managers can fulfill them from sources that come from outside the company and can also come from within the company. Sources from outside the company come from the capital market, meetings between parties need funds and parties who can provide funds. Funds originating from this capital market can take the form of debt (bonds) or own capital (shares). Sources from within the company come from the provision of company profits (retained earnings), reserves,
and depreciation.
After funds are obtained, these funds must be used to finance company operations. Funds will be embedded in various real assets of the company.
Some definitions:
Financial Management is management of financial functions. These financial functions include how to raising of funds and how to use allocation of funds. Financial managers have an interest in determining the amount of appropriate assets from investing in various assets and selecting sources of funds to finance the assets.
Financial managers have an interest in determining the amount of appropriate assets from investing in various assets and selecting sources of funds to finance these assets. To finance these funding needs, financial managers can fulfill them from sources that come from outside the company and can also come from within the company. Sources from outside the company come from the capital market, meetings between parties need funds and parties who can provide funds. Funds originating from this capital market can take the form of debt (bonds) or own capital (shares). Sources from within the company come from the provision of company profits (retained earnings), reserves,
and depreciation.
After funds are obtained, these funds must be used to finance company operations. Funds will be embedded in various real assets of the company.
Some definitions:
Financial Management is the activity of the owner and management of a company to obtain capital resources as cheaply as possible and use them as effectively, efficiently, as productive as possible to generate profits.
Financial management can be defined from the duties and responsibilities of financial managers. Although the duties and responsibilities are different in each company, the main tasks of financial management include: decisions about investment, financing of business activities and dividend distribution of a company.
Financial Management is an activity of planning, budgeting, checking, managing, controlling, searching and storing funds owned by an organization or company.
Financial Management Functions
Financial management can be defined from the duties and responsibilities of financial managers. The main tasks of financial management include decisions about investment, financing of business activities and dividend distribution of a company, thus the task of financial managers is to plan to maximize the value of the company.
Other important activities that must be carried out by financial managers involve four (4) aspects, namely:
- First, namely in planning and forecasting, where the financial manager must work with other managers who are also responsible for the general planning of the company.
- Second, the financial manager must focus on various investment and financing decisions, as well as everything related to them.
- Third, financial managers must work with other managers in the company so that the company can operate as efficiently as possible
- Fourth, regarding the use of financial markets and
capital markets, financial managers connect companies to financial markets,
where funds can be obtained and company securities can be traded.
From the four aspects, it can be concluded that the principal tasks of
financial managers are related to investment and financing decisions. In
carrying out its functions, the duties of financial managers are directly
related to the company's main decisions and affect the value of the company.
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