BUSINESS

FINANCE
BSTM 1-TM11
9:00 AM - 12:00 AM W
Introduction
to Business
Finance
Understanding
Finance
Learning Outcomes:
Identify different areas of Finance

Discuss finance in business organization.

Describe the functions of a finance officer.

State the qualifications of a finance officer.

Finance Both a science and an art

Application of economic
and accounting concepts
principles.
 Economically, the fundamental concern of
finance, is to ensure that the limited
financial resources are correctly managed,
Management, allocated, and utilized in order to achieve
allocation and the financial goal of a business.

Utilization In this context, management implies the

efficient handling of business resources,
particularly those that are financial in
nature.

Allocation connotes the wise distribution

of financial resources to the different
functional areas, the proper assignment of
funds between current and non-current
assets, and the correct sourcing of funds
based on theconcepts of risks and return.
 Savers Financial User of Funds
Intermediaries (Borrowers/Investures)

Household Banks Household

Individuals Insurance Companies Individuals
Corporations/Companies Stock Exchange Corporations/Companies
Government Agencies Mutual Funds Government Agencies
Other Financial Institutions

Financial System
Areas of Finance
FINANCE IN ORGANIZATION
Functions
Board of Directors

of Finance
Officer Operating Division
(Chief Operating Officer)
Chief Executive
Officer
Finance Division
(Chief Finance Operator

The finance officer is heavily engaged in

making decisions for the business to attain its
objectives at the optimum level. His or her
decision-making function is broadly Accounting Treasury
classified into three:
Production
Human
and Marketing
Operating Decisions Resource
Operations
Investing Decisions
Financing Decisions

Functions of
Finance Officer
Possesses sound knowledge of accounting and economic
concepts and principles
Has profound understanding of operation science,
statistics, and marketing research
Has gained technical experience in finance and provided
professional judgment
Has good communication skills in both oral and written
forms
Has impressive relationship with banks and other
financial institutions
Has outstanding relationship within the business and
among other functional areas
Is ethically and morally upright and socially responsible
Operating decisions
are financial decisions affecting the routine operating activities
of a business. It is directed towards providing immediate
solution to the concerns of the functional areas of the firm
such as manufacturing, marketing, purchasing and the like.
Investment decisions
deal with choosing small an large projects with several
investment opportunities. The different projects are critically
evaluated in terms of return on investment and expected cash
flow.
Financing decisions
deal with raising or acquiring of funds from outside sources
andnot from the ordinary results of the business operations. In
other words, financingdecisions are made when the business
needs to borrow money.
Thank you!