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Unit I

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Akash Dhakad
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6 views7 pages

Unit I

Uploaded by

Akash Dhakad
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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Meaning of FM

• The term financial management can be


defined as the management of flow of
funds and it deals with the financial
decision making.
• According to Howard and Upton
“Financial Management is the application
of planning and controlling functions to
finance functions.
Finance as an area of study
• Financial management of
▫ Trading or manufacturing company.
▫ Financial Institution.
▫ Investment Management.
▫ International Finance.
▫ Public Finance.
Finance Functions
• Financing decisions.
• Investment decisions.
• Dividend decisions.
• Liquidity decisions.
Financial Decisions Making and the
Relevant Groups
• The shareholders.
• The debt investors.
• The employees.
• The customers.
• The suppliers.
• The public.
• The government and
• The management.
Goal of the Financial Decision Making
• The maximization of the profits of the
firm, and
• The maximization of the shareholders
wealth.
Profit Maximization vs. Wealth
Maximization

?
Responsibility of Financial
Manager
• Financial Forecasting and planning.
• Procurement of finances.
• Controlling the uses of funds.
• Disposal of Profits.
• Understanding Capital Markets.
• Maximizing Profits After Taxes.
• Maximizing EPS.
• Risk-return trade-off.
• Shareholders Wealth Maximization.
• Insurance of Assets, Collections and
interpretation of necessary data.

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