Financial Management

The major obective of any business concern is to make profit for its owners by selling goods or services. To reach this goal finance is required. In this context it can be said that finance is the soul of any business concern. Keeping this in view, the proper management of finance is absolutely necessary. Financial Management is concerened with optimal procurement as well as usage of finance. Financial management my be defined as planning, raising, utilising and controlling of funds used in business. It involves management of the financial activities of business enterprises. It is concerned with maximising the wealth of owners of business through wise and rational invesment of funds.

Definitions of Financial Management:

According to J.L.Massie, “Financial management is the operational activity of a business that is responsible for obtaining and effectively utilizing the funds necessary for efficient operations.”

According to B.O.Wheeler, “Financial management is the business activity which is concerned with acquisition and conservation of capital funds in meeting financial needs and overall objectives of business enterprise.”

In the words of J.F.Bradely, “Financial management is that area of business management devoted to a judicious use of capital and a careful selection of sources of capital in order to enable a spending unit to move in the direction of reaching its goals.”