Financial Management

N. Karunambikai Faculty Member - Dept. of Management Studies Oxford College of Engineering, Bangalore

Index Introduction Finance & Economics Finance & Accounting Related disciplines Scope of FM .

economics and accounting Provide an overview of the scope of financial management in terms of the important decision making areas relating to the financial operations of an organization Discuss the objectives of financial management Outline the main functions of financial managers in a typical organization Summarize .Introduction Examine the relationship between finance.

economics and accounting Provide an overview of the scope of financial management in terms of the important decision making areas relating to the financial operations of an organization Discuss the objectives of financial management Outline the main functions of financial managers in a typical organization Summarize .Introduction Examine the relationship between finance.

production and quantitative methods are interrelated but with some key differences. • Finance.Finance & Economics • Financial management is an integral part of overall management. accounting. economics. marketing. – Macro economics • • • • • Industry Recognize and understand cost and availability of funds Be versed with fiscal policy and its effects of economy Be aware of various financial institutions and outlets Understand the level of economic activities – Micro economics • • • • • Firm Supply and demand Issues related to mix of productive factors Measurement of risk factors Marginal analysis – Marginal revenue and Marginal cost .

current performance of the firm and make decisions for future performance.Finance & Accounting • Finance and accounting are closely related – Accounting is an input for finance functions – Accounting generates information/data relating to the activities of the firm INPUT From different departments of an organisation PROCESS Accounting function OUTPUT Balance sheet FFS / CFS • Output helps the Finance manager in understand the past. .

Finance & Marketing • Finance management should consider the impact of – Promotion plans in the market area – Capital outlay requirement and – Projected cash flow for promotional expenditure .

Finance & Production • Finance management should consider the impact of – New product developments – Production process change related capital expenditures .

Investment analysis Working capital management Sources and cost of funds Determination of capital structure Dividend policy Analysis of risks and returns Result Support Support • • • Accounting Macro economics Micro economics Secondary • • • Marketing Production Quantitative methods Share holder wealth maximization . 6. 5. 3. 2. 4.Other related disciplines Primary 1.

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