Financial management is one of the most crucial factors for individuals and organizations in this rapidly expanding world. It is now more critical to manage and increase your finances rather than save money. One must possess solid knowledge and understanding of financial accounting, and management in order to operate a business effectively and efficiently and accomplish business objectives.
This is one reason for assigning students finance-related projects where they must use finance management strategies to complete a task. It could be tricky sometimes to complete such assignments, so many students, researchers, and auditors seek help with finance dissertation editing (Saad, 2020) from Finance Homework Writing Service to help meet their degrees and get good grades.
According to Guthman and Dougal, financial management is known as “the activity concern with the planning, raising, controlling, and managing of funds use in the business,” which is what financial management is (CHIJIOKE, 2016).
Gaining financial independence is one of all businesses’ primary goals. To achieve the goal of financial independence, however, business owners must be aware of the possible effects of their management choices with regard to a variety of economic aspects, including profits, cash flows, financial risks, and others.
As the company grew and expanded over time, it needed more and more money to fund its expansion and growth plans. Especially the Businesses that work worldwide, such as USA Assignment Service, need to accurately budget and schedule their financial requirements in this regard.
What is the function of the financial management department?
A financial manager is in charge of the financial management division of any company. This division performs a wide range of duties, including:
- Calculating the capital necessary:
The financial manager must determine how much money the organization needs. This is dependent on the company’s policies regarding anticipated costs and profits. The necessary sum must be calculated to improve the organization’s earning capacity.
- Forming a capital structure:
After estimating how much capital the company needs, a capital structure must be create. Both a short-term and a long-term debt equity analysis are involved in this. This depends on how much capital the company already has and how much needs to raise from outside sources.
- Capital investment:
To raise additional funds and generate consistent returns. Therefore, the financial manager must put the company’s money into profitable and secure ventures.
- Profit distribution:
The financial manager’s responsibility is to effectively distribute net profits after the organization has generated a sizeable number of them. This might entail setting aside a portion of the net profit for expansion, innovation, or contingency plans while using another portion to pay dividends to shareholders.
- Effective money management:
This division is also in charge of handling the company’s finances well. The company needs money for a number of things, including paying employees’ salaries and bills, keeping stock, covering liabilities, and buying any necessary materials or equipment.
6. Financial control:
In addition to planning, organizing, and obtaining funds, the financial manager must also monitor and analyze the firm’s finances in the short and long term. Financial instruments like financial forecasting, ratio analysis, risk management, and profit and cost control can be used.
Importance of financial management:
Financial Preparation:
Financial planning is essential for financial management. It determines each monetary requirement related to business concerns. In the later stages of a company’s financial management life cycle, financial planning associates must also act promptly and appropriately rather than worrying.
Protecting and Safeguarding Funds:
Financial management is essential for achieving business objectives and for safeguarding finances. To ensure that a business runs smoothly, it is vital to assess the areas where funds are needed and adequately distribute them. Spending too much on one project can harm other business operations because they frequently lack funding. It is essential to protect money and make wise investments.
Investing Possibilities:
If you are good at managing your money and saving, you will have opportunities to explore investing as a person. You can build wealth through investment opportunities so that you can enjoy your retirement. The same phenomenon applies to the business. Finance managers look for investing possibilities to enhance the budget of the company they are working for.
They can explore various investment opportunities, such as buying stocks, gold, mutual funds, real estate, or lands.
Economic Stability and Growth:
The company’s economic growth will be ensured by prudent financial planning. It will gradually increase the business’s wealth, which will aid in future financial development. Financial stability is a crucial aspect of life. Economic growth is the only way to guarantee financial stability, and sound financial management is the only way to do so.
Evaluation of a Business:
The significance of financial management in an organization concerning diversifying investors and the business concern. Any business’s most extreme concern is that it will maximize profit while operating more effectively.
It might be connected to boosting output or taking your business overseas. A great management team and financial experts can help raise a company’s valuation.
Plan your taxes:
Planning for taxes should be part of a financial strategy. Failure to properly prepare taxes will cause a company to spend more money out of the owner’s pocket.
For instance, if a businessman can determine that his tax expenditures will be lower this fiscal year but higher the following year, he should adjust the budget and saving goals accordingly. If they don’t do this, they might run out of money, affecting their ability to make investment decisions.
Conclusion:
Consider the significance of the above-mentioned financial management points for your own benefit. Your standard of living will rise, your peace of mind will increase, and you won’t have to worry about money. When you realize the numerous advantages of financial management, it is strongly advise that you begin to consider it.
Planning, organizing, directing, and controlling economic activities like acquiring and using an organization’s funds are all aspects of financial management. It entails relating wide-ranging management principles to the enterprise’s financial resources.
References:
CHIJIOKE, E., 2016. EFFECT OF FINANCIAL MANAGEMENT COMPETENCIES ON CREDIT MANAGEMENT OF NIGERIA MONEY DEPOSIT BANKS. International Journal of Research in Economics and Social Sciences (IJRESS), 6(9). [Accessed date: 04-08-2022]
Saad, Muhammad. 2020. Finance Dissertation Editing And Proofreading Services. Online available at <https://dissertationwritinghelp.uk/finance-dissertation-editing-and-proofreading-services/>[Accessed date: 04-08-2022]
