It plays an important role in overall management by dealing with various functional departments like personnel, marketing and production. Scope of financial managementįinancial management covers wide area with multidimensional approaches. There different approaches involved like developing certain standards for business in advance,Ĭomparing the actual cost or performances with pre-established standards and taking all require Implying financial controls helps in keeping the company actual cost of operation within limits and It aims to increase the amount of return to its shareholders by decreasing its cost of operations andįinance manager should focus on raising the funds from different sources and invest them inįinance manager observes all cash movements (inflow and outflow) and ensures they should face Every organisation should properlyĪnalyse various source of funds (shares, bonds, debentures etc.) and must select appropriate fundsīefore investing the amount, the investment proposal should be analysed and properly evaluates its Source of fund is one crucial decision in every organisation. Proper balance between debt and equity should be attained, which minimizes the cost of capital.įinancial management decides proper portion of different securities (common equity, preferred
Requirements for carrying business activities. The nature of financial management includes the following −įinancial management helps in anticipation of funds by estimating working capital and fixed capital Let us first understand the nature of financial management and then study about its scope.
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