What is Financial management

 Definition

One need money to make money. Finance is the life blood of business and there must be continuous flow of fund in and out of a business enterprises. Money makes the wheel of business run smoothly by sound planning, efficient production system, an excellent marketing network are all hamper in the absence of adequate and timely supply of fund. Sound financial management is as important in business firm requires finance to comment its operation, to continue operation and for expansion or growth. Finance is an important operative function of business.

A large business form has to raise fund from several sources and has to utilise their fund in alternative investment opportunities fully stop in order to ensure the most judicious Dualization of phone and to provide a reasonable rate of return on the investment, Sound financial policy and programme are required. wise financial can save a business from Bankruptcy just as easily as quality product, better marketing or low production cost.

On the other hand, adequate and economical financial can provide the firm a differential advantage in the marketplace. the success of business enterprises is largely determine by the way its capital fund are raised, utilized and disbursed. In the modern world using economy the important of finance has increased further increasing scale of operation and capital intensive technology of production and distribution channel.

In fact finance is the bright thread  running through all business activities. It influence and limit the activities of marketing, production, purchasing and personal management. The success of business is major largely in financial term. |The efficient organisation and administration of the finance function is thus vital for the success of every business enterprises.

Meaning of financial management

Financial management involves the planning, acquisition, control and management of funds within a business. It applies management principles to the assets of an organization. Plays a crucial role, in fiscal management. This includes making investments, effectively managing capital and assets. Additionally financial management encompasses setting objectives, goals and responsibilities for the manager. It is a function that directly relates to top level management and holds significance not in the "Line" but also as part of the overall administration of a company. Different experts in the field may have varying definitions, for this function.

Financial management means planning, organising, directing and controlling of the financial activities such as procurement and utilization of fund of the enterprises.

according to Harry G. Guthmann and Herbert E. Dougall Financial management means, " The activities concerning with the planning, raising, controlling and understanding of fund using in the business." It is concerned with the procurement and utilisation of funds in the proper manner.

Financial activities not only deal with procurement  and utilizing of fund but also with the accessing of needed for funds, raising required financial capital, budgeting, Distribution of sort plus, financial control etc. 

Ezra Solomon Has described the nature of Finance and management as," Financial management is properly viewed as a integrate part of overall management rather than as a staff especially concerned with funds raising operation,"

In this board view, the issue of Finance and policy is the wise use of fund and the central process involved is a rational matching of the advantage of potential use against the cost of alternative potential source so as to achieve the board financial goal with an enterprise set for itself. In addition to raising phone financial management is directly concerned with production, marketing and other function within the enterprise whichever decision are made about the acquisition or distribution of Fund.

Objective of financial management 

Financial management is one of the function area of business While considering objective of financial management the overall business must be considered. The overall objective of Finance and management is to provide maximum return to the owner on their investment in the long run.

• Insure regular and adequate supply of fund to the concern
• Insure adequate return to the shareholder 
• Ensure optimum fund utilisation 
• insure safety of investment example funds should be invested in the safe venture 
• plan a sound capital structure
• Generate and build a surplus for expansion and growth 
• minimise cost of capital by developing a sound and economical combination of cooperative securities
• Coordinate the activities of the finance  department with activities of other department of the firm.