Making the money available and using it is called finance. A large number of legal formalities are to be completed when starting a new industry. Money is life-blood of any industrial or commercial organization. It is needed for starting the industry and running it. Financial management is concerned with the finance function of the firm. It is one of the main sub subsystem of the management. It is concerned with the planning and controlling of the finance of the firm. Finance planning determines the capital requirement, capital structure and use of funds. Finance control ensures effective utilisation of funds and probe management of earnings.
The main function of financial management are determining the capital requirement, selecting the sources of the capital and raising the capital, effectively using the capital and protecting the capital, managing the earnings. An industry is required to produce goods and sell it. To achieving the functions like production and distribution are to be performed. This involves huge investments. So a firm must have sufficient amount of funds. Otherwise it survival and growth will be difficult. In olden days finance was not an important factor in a manufacturing activity. Because of the scale of operation was very small. But nowadays industries operate on a large scale. Production is done using advance technology, this needs heavy amount. So the need for the finance is too great now.
FINANCIAL MANGEMENT
Making the money available and using it is called finance. A large number of legal formalities are to be completed when starting a new industry. Money is life-blood of any industrial or commercial organization. It is needed for starting the industry and running it. Financial management is concerned with the finance function of the firm. It is one of the main sub subsystem of the management. It is concerned with the planning and controlling of the finance of the firm. Finance planning determines the capital requirement, capital structure and use of funds. Finance control ensures effective utilisation of funds and probe management of earnings. The main function of financial management are determining the capital requirement, selecting the sources of the capital and raising the capital, effectively using the capital and protecting the capital, managing the earnings. An industry is required to produce goods and sell it. To achieving the functions like production and distribution are to be performed. This involves huge investments. So a firm must have sufficient amount of funds. Otherwise it survival and growth will be difficult. In olden days finance was not an important factor in a manufacturing activity. Because of the scale of operation was very small. But nowadays industries operate on a large scale. Production is done using advance technology, this needs heavy amount. So the need for the finance is too great now.
Making the money available and using it is called finance. A large number of legal formalities are to be completed when starting a new industry. Money is life-blood of any industrial or commercial organization. It is needed for starting the industry and running it. Financial management is concerned with the finance function of the firm. It is one of the main sub subsystem of the management. It is concerned with the planning and controlling of the finance of the firm. Finance planning determines the capital requirement, capital structure and use of funds. Finance control ensures effective utilisation of funds and probe management of earnings. The main function of financial management are determining the capital requirement, selecting the sources of the capital and raising the capital, effectively using the capital and protecting the capital, managing the earnings. An industry is required to produce goods and sell it. To achieving the functions like production and distribution are to be performed. This involves huge investments. So a firm must have sufficient amount of funds. Otherwise it survival and growth will be difficult. In olden days finance was not an important factor in a manufacturing activity. Because of the scale of operation was very small. But nowadays industries operate on a large scale. Production is done using advance technology, this needs heavy amount. So the need for the finance is too great now.
