Financial Perspectives In The Current Climate Finance Essay

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The means of financial is the planning, organizing, directing and controlling, so it must applying general principles to financial resources of the company.

The decisions in investment contain fixed assets investment, it called as capital budgeting.

The current assets in investment also one of decisions in investment, so it called as working capital decisions.

The decisions in financial, it related to the raising of finance from difference resources which will depend on type of source, period of financing, cost of financing and the returns.

The decisions in dividend, the finance manager is the one must take decision on net profit distribution. The net profits are separated into two:

Dividend to the shareholders = Dividend and the rate will be decided.

Retained profits = amount of retained profits will be confirm depend on the expansion and variety of plans of the company.

3.3.1.3 Objectives of financial

The financial is basically worried with earnings, allocation and control of financial resources. The objectives will be:

To make sure regular and enough supply of funds.

To make sure enough returns to the shareholders, it depend on the earning capacity, market price and potential of the shareholders.

To make sure safety on investment, example, every fund supposed to invest in safety business so that can get enough return.

To plan good capital structure, there must be good and fair arrangement of capital so that a balance is maintained between debit and fairness capital.

To make sure it’s advantageous funds, like the funds should use in maximum level in low cost.

Functions of Financial

Funds investment:

A decision have to make from finance manager for keeping funds into money making ventures, so that it is safety on investment and regular returns.

Cash management:

A decisions need to make from finance manager to cash management section. The most important thing is the cash, the cash doing many purposes like paying worker salaries, electricity bill, water bill, rent, wages, creditors, maintenance of stock, buying of new materials, etc.

Financial controls:

Plan, obtain and use the funds it’s not only job for finance manager but he also need to control in finances by doing control in cost and profit, financial prediction, ratio analysis, etc.

Choices of funds source:

For extra funds to be obtain, so the company got choices like

Issue of shares.

Loans from banks and financial agent.

Estimate of capital requirement:

The finance manager has to make prediction of capital requirement in the company, it depend on estimated costs and profits, future programmers and policies. So that, it will increase earning capacity of the company.

Purpose of capital composition:

After estimate process has be done, the capital structure need to decide.

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