OBJECTIVES

THE FINANCIAL MANAGEMENT IS GENERALLY CONCERNED WITH ALLOCATION AND CONTROL OF FINANCIAL RESOURCES OF A

CONCERN. THE OBJECTIVES CAN BE:

•ENSURE SAFETY ON INVESTMENT (FUNDS SHOULD BE INVESTED IN SAFE VENTURES).

•ENSURE OPTIMUM FUNDS UTILIZATION.

•ENSURE REGULAR AND ADEQUATE SUPPLY OF FUNDS TO THE CONCERN.

Managing Finance

Training Methods:

Presentation Flow :

Ice breaker

Module / Presentation Proper

Closing

Module

What is financial management?

Financial Management means planning, organizing, directing and controlling the financial activities such as procurement and utilization of funds of the enterprise. It means applying general management principles to financial resources of the enterprise.

What are the goals of Financial Management?

The financial management has to take three important decision (i) Investment decision i.e., where to invest fund and in what amount, (ii) Financing decision i.e., from where to raise funds and in what amount, and (iii) Dividend i.e., how much to pay dividend and how much to retain for future expansion. In order to make these decisions the management must have a clear understanding of the objective sought to be achieved. It is generally agreed that the financial objective of the firm should be maximization of owner's economic welfare. 

Functions of Financial Management

1. Estimation of capital requirements: A finance manager has to make

estimation with regards to capital requirements of the company. This will depend upon expected costs and profits and future programs and policies of a concern. Estimations have to be made in an adequate manner which increases earning capacity of enterprise.

2. Determination of capital composition: 

Once the estimation have been made, the capital structure have to be decided. This involves short- term and long- term debt equity analysis. This will depend upon the proportion of equity capital a company is possessing and additional funds which have to be raised from outside parties.

3. Choice of sources of funds: For additional funds to be procured,

a company has many choices like:Loans to be taken from banks and

financial institutionsPublic deposits to be drawn like in form

of bonds.Issue of shares and debentures

4. Investment of funds: 

The finance manager has to decide to allocate funds into profitable ventures so that there is safety on investment and regular returns is possible

5. Management of cash Finance manager has to make

decisions with regards to cash management. Cash is required for many purposes like payment of wages and salaries, payment of electricity and water bills, payment to creditors, meeting current liabilities, maintenance of enough stock, purchase of raw materials, etc.

6. Financial controls

 The finance manager has not only to plan, procure and utilize the funds but he also has to exercise control over finances. This can be done through many techniques like ratio analysis, financial forecasting, cost and profit control, etc.

How to manage your finance wisely?

In this tough economy, it is just right that we learn how to handle our hard earned income wisely in order to prepare us for the worst and allow us to enjoy whatever financial privileges we have at the moment.

The following are some ways that will guide all your spending motives:

Make a detailed financial plan

Knowing where your money should go is the best move you can undertake at this point of time, especially if the flow of income coming your way is not sufficient for all your expenditures. Learn how to prioritize your needs from your wants and for sure you won’t be trapped with various loans. When you make a list of all your expenses, stick to the budget you have set aside

 Avoid impulsive buying

To avoid making unnecessary purchases, we must avoid going to malls, especially when we knew that we are on a tight budget. It doesn’t mean that having a credit card gives you every reason to splurge on anything you want. Remember all these credit purchases made will soon be collected at the end of the month and you might be surprised that your next paycheck will be allotted only for your credit payments.

Keep records of your finances

A highly organized individual must keep a complete record of all his/her expenditures as well as any savings made to assess your financial capability. It would be a good idea to keep all those receipts for future references and record keeping purposes. Once you complete your total expenditures, you can now weigh now your overall financial standing and help you come up with a better financial plan next time.

   Consult a debt solution agency

If you are facing a huge financial obligation and don’t know where to start right, it would be appropriate to seek the advise of a debt solution agency or any financial advisor. There are a lot of these financial organizations who offer their expertise and services to help you come up with a concrete action

Be contented of what you have

Adopting a positive outlook in life and a feeling of pure contentment to whatever you have at the moment will surely help you manage your income wisely.  Don’t aspire for more than what you can actually acquire. Be realistic as to what extent your wage can bring to you.

Closing

“There is no exact formula when it comes to proper handling of our finances. Some of us fairly manage to make both ends meet even without a financial plan to guide them, but others who want to feel more secured and

directed in their spending, resort in making a financial list on how they will spend every

penny earned.”

-Nuguid