An overview of Financial Management Assignment Help
Have you ever heard the words like “money”, “capital”, “finance”, “economics”, “management”, “market”, “company”? What do they mean for you? Is it something connected with what you can get, save, earn or spend? These words are different but the root is the same – financial management.
Financial management as a scientific discipline which was born at the beginning of the last century in the United States of America. In the early stages of it's formation is referred to the financial aspects of the creation of new firms and companies, financial investments and bankruptcy issues.
Basic financial management questions are related to the company's capital and ensuring the most efficient use. It includes strategy and tactics.
The main purpose of management is to maximize the profits, the enterprise's prosperity with the help of a rational financial policy.
It is a component of the management process and provides the information necessary to:
·ensure the most effective use of financial resources;
·optimizing cash turnover;
·insurance of financial risk's optimization at the enterprise;
·potential financial opportunities of the enterprise assess;
·profitability security of the enterprise;
·current financial stability of the enterprise providence.
The Role Of Financial Management In The Management Of The Organization
Management is a system of specific objects, including a set of principles, methods, forms and methods of administration. Development of managerial decisions based on the collection, transmission and processing the necessary information.
Finance is a system of economic relations, connected with the formation, distribution and use of funds in the course of their circulation.
Formation Of Financial Resources
In modern conditions of market economy, financial management is the most complex and crucial element in the various aspects of the management system.
It is carried out through the financial mechanism, which can be defined as a system of actions of financial methods, which is expressed in the organization, planning and promoting the use of financial resources.
There are four main elements of the financial mechanism: state legal, market, or inner regulation of financial activity, and the system of specific techniques and methods used by the company in the process of analysis, planning and control of financial activities.
Informational Support Of Financial Management
The content information of the financial management system is determined by the characteristics of the enterprise's industry, its organizational-legal form, scale and the degree of diversification of financial activities and a number of other conditions.
Specific indicators of the system formed by the external and internal sources, which can be divided into the following groups:
1. Indicators of overall economic development of the country (used in strategic decision-making in the field of financial activity).
2. Indicators of financial market conditions (used in the formation of the financial investment portfolio, the implementation of short-term investments).
3. The indicators characterizing the activities of competitors and counter parties (used in making operational decisions).
4. Legal and regulatory indicators.
5. Indicators of financial results of the company (balance sheet, profit and loss statement).