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Understanding, Function, and Scope of Financial Management

Financial management is one part of management science that until now continues to be developed from the beginning only collect funds alone, now has covered all financial activities ranging from raising funds, use up to fund management. And to know the ins and outs, here we will review more fully.
Understanding Financial Management
There are several opinions of experts related to the definition of financial management, which is essentially an activity undertaken by the company related efforts to obtain funds and how to minimize the management to achieve goals that have been planned by related companies.
In a company, financial management is necessary to increase the value of the company itself, when management in a good company it is certain that the company's selling value is high, and stock prices will remain stable which will make investors will be happy to pour their funds. To ensure this, it takes a competent and experienced financial manager in their field.
Financial Management Function
Basically the financial management related activities of the company has two main functions, the first is the function of acquisition of funds, where the company must take decisions related to funding or alternative selection in search of sources of funds. In addition, how to obtain the easiest and cheapest funds can be reflected in the balance sheet.
The second function is the use of funds. Where financial management must make decisions regarding investment decisions or investment selection. It also plays an active role in managing the expenditure can be used efficiently. Last is the planning and allocation of funds that have been collected in order to provide more benefits for the company.
Of the two functions mentioned above, hereinafter translated into several functions of financial management that function for financial search, financial planning, financial budgeting, financial management, financial storage, control of financial system in company, financial examination to avoid fund deviation, and last function for financial reporting which is also used as an evaluation of the company.
Scope of Financial Management
Based on the exposure related to corporate management activities in the field of finance above, we will see that basically the scope of financial management in the company dwell on three things. The first is how to obtain funds. Related to the activities undertaken to obtain sources of funds or investors. Whether it comes from within the company or from outside the company's marriage.
Next is how the use of funds, which is an activity undertaken to use the source of funds that have been obtained in the form of investments in various forms of assets or assets related to the allocation of cash, fixed assets and for other assets adjusted to the amount of assets owned.
And the latest scope of financial management is how to manage assets owned. Which is an activity to manage the resources that have been invested and allocated in various forms of assets or assets effectively and efficiently, to gain the maximum profit with the lowest load expenditure.
From the description above can be concluded that financial management is an activity conducted by the owner or the management of the company that aims to obtain the source of funds as cheaply and for the next use and managed effectively and efficiently to generate profits as big as possible. Thus information that we can convey, hopefully can increase your knowledge ..
Description: Financial management has a very important function to facilitate the achievement of corporate goals, for that required a finance manager competent and understand the ins and outs of financial management.

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