Tag Archives | Management

Need for Cost Management | Accounting

In this article we will discuss about the need for cost management. The business environment has changed dramatically after 1980s. Improved communication and transportation systems brought about a much more competitive environment. Spending on marketing and distribution has increased. The modern organizations started exercising strict control over manufacturing costs. Information technology changed the way organizations […]

3 Main Approaches to Financial Management | Management

The following points highlight the three main approaches to financial management. The approaches are: 1. Traditional View 2. Modern View 3. Liquidity and Profitability. Approach # 1. Traditional View: Financial management is primarily concerned with acquisition, financing and management of assets of business concern in order to maximize the wealth of the firm for its […]

Top 20 Functions of Financial Controller

The following points highlight top twenty functions of a financial controller in a large business. The functions are: 1. Provision of Capital 2. Investor Relations 3. Short-Term Financing 4. Banking and Custody 5. Credit and Collections 6. Insurance 7. Investments 8. Planning for Control 9. Reporting and Interpreting 10. Evaluating and Consulting 11. Tax Administration […]

3 Main Significance of Financial Management

The importance of financial management is known from the following aspects:- 1. Applicability 2. Chances of Failure 3. Return on Investment. Significance # 1. Applicability: The principle of finance is applicable wherever there is cash-flow. The concept of cash-flow is one of the central elements of financial analysis, planning, control and resource allocation decisions. Cash-flow […]

4 Main Financial Objectives of Business Firm

The following points highlight the four main objectives of business firm. The objectives are: 1. Profit Maximization Objective 2. Wealth Maximization Objective 3. Value Maximization Objective 4. Other Maximization Objectives. 1. Profit Maximization Objective: Profit as an objective has emerged from over a century of economic theory. In this traditional economic theory, the typical firm […]

Impact of Taxation and Inflation on Financial Management

In this article we will discuss about the impact of taxation on corporate financial management. Impact of Business Taxation: The tax payments represent a cash outflow from the business and therefore, these tax cash flows are critical part of the financial decision making in a business firm. In deed in some practical situations, the taxation […]

Risk and Return in Financial Planning | Company

In this article we will discuss about the risk and return faced while financial planning of a company. Costing and Risk: The word ‘costing’ relates to the ascertainment of cost of capital from different sources like equity capital, preference capital, debentures, long-term loans etc. The most crucial decision of any company is involved in the […]

Impact of Depreciation on Financial Management

In this article we will discuss about the impact of depreciation on financial management. Depreciation is the measure of wearing out, consumption or other loss of value of a fixed asset. It may arise from use of asset, affluxion of time, obsolescence through technology and market changes etc. The cost of a product should consist […]

Top 8 Techniques of Financial Management

The important techniques of financial management are summarized as follows:- 1. Common-Size Statements 2. Trend Ratios 3. Funds Flow Analysis 4. Cash-Flow Analysis 5. Ratio Analysis 6. Working Capital Management 7. Capital Structure 8. Capital Budgeting Techniques. Technique # 1. Common-Size Statements: The common-size financial statements are those in which figures reported are converted into […]

Funds Flow Statement and Income Statement | Financial Management

The funds flow statement and income statement have different functions and their main differences are summarized below: Difference # Funds Flow Statement: 1. Funds flow statements main objective is to ascertain the funds generated from operations. It reveals the sources of funds and their applications. 2. Funds flow statement is prepared based on the financial […]

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