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    Chapter 1 Synthesis Financal MNGMT

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    Joyce
    Financial management involves managing money and making financial decisions for businesses. The role of the financial manager is to control monetary issues for organizations of all types. Key duties include developing financial plans, extending credit, assessing investments, and fundraising. Financial management approaches differ based on a business's legal structure as a sole proprietorship, partnership, or corporation. Ultimately, the financial manager's goal is to maximize owner wealth by making sound investment and financing decisions using tools like cost-benefit analysis, while also considering stakeholders' interests and behaving ethically. Financial managers serve as agents to business owners as principals, and corporate governance aims to ensure managers' decisions align with owners' long-term interests.

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    Chapter 1 Synthesis Financal MNGMT

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    Joyce
    32 views2 pages
    Financial management involves managing money and making financial decisions for businesses. The role of the financial manager is to control monetary issues for organizations of all types. Key duties include developing financial plans, extending credit, assessing investments, and fundraising. Financial management approaches differ based on a business's legal structure as a sole proprietorship, partnership, or corporation. Ultimately, the financial manager's goal is to maximize owner wealth by making sound investment and financing decisions using tools like cost-benefit analysis, while also considering stakeholders' interests and behaving ethically. Financial managers serve as agents to business owners as principals, and corporate governance aims to ensure managers' decisions align with owners' long-term interests.

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    Chapter 1 Synthesis Financal Mngmt

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    Financial management involves managing money and making financial decisions for businesses. The role of the financial manager is to control monetary issues for organizations of all types. Key duties include developing financial plans, extending credit, assessing investments, and fundraising. Financial management approaches differ based on a business's legal structure as a sole proprietorship, partnership, or corporation. Ultimately, the financial manager's goal is to maximize owner wealth by making sound investment and financing decisions using tools like cost-benefit analysis, while also considering stakeholders' interests and behaving ethically. Financial managers serve as agents to business owners as principals, and corporate governance aims to ensure managers' decisions align with owners' long-term interests.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    32 views2 pages

    Chapter 1 Synthesis Financal MNGMT

    Uploaded by

    Joyce
    Financial management involves managing money and making financial decisions for businesses. The role of the financial manager is to control monetary issues for organizations of all types. Key duties include developing financial plans, extending credit, assessing investments, and fundraising. Financial management approaches differ based on a business's legal structure as a sole proprietorship, partnership, or corporation. Ultimately, the financial manager's goal is to maximize owner wealth by making sound investment and financing decisions using tools like cost-benefit analysis, while also considering stakeholders' interests and behaving ethically. Financial managers serve as agents to business owners as principals, and corporate governance aims to ensure managers' decisions align with owners' long-term interests.

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    © All Rights Reserved
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    Download as docx, pdf, or txt
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    FINANCIAL MANAGEMENT

    Synthesis about The Role of Managerial Finance (Chapter 1)

    Finance is defined as the science and art of managing money. It is known as an


    expansive and dynamic field. So what does this mean? This means that, learning about it is
    not necessarily only for those people who are pursuing to have a career in finance or
    business, so regardless of whether you don't see yourself seeking after a finance or business
    profession, you'll see that a comprehension of a couple of key thoughts in financial
    management will help make you a more brilliant customer and a savvier financial backer
    with your own cash.

    Focusing about the role of managerial finance in business, it is concerned with the
    duties of the financial manager of a company. Financial managers control the monetary
    issues of all kinds of organizations—private and public, enormous and little, benefit chasing
    and not for benefit. They perform such changed undertakings as building up a monetary
    arrangement or financial plan, stretching out credit to clients, assessing proposed enormous
    uses, also fund-raising to support the association's tasks. Also, financial management differs
    and depends on what legal form an organization is, if it is a sole proprietorship, partnership
    or a corporation. Perhaps the most fundamental choices that all organization stands up to
    are the way to pick an authoritative document of association. This choice has vital monetary
    ramifications since what a business is coordinated legitimately means for the dangers that
    the association's proprietors should bear, how the firm can fund-raise, and how the
    company's benefits will be burdened.

    So now we understand that the essential exercises of the financial manager in


    managerial finance, notwithstanding progressing association in monetary examination and
    arranging, are settling on speculation choices and making financing choices. That is why the
    financial manager must also comprehend the economic environment and rely heavily on the
    economic principle of marginal cost–benefit analysis to make financial decisions. Financial
    managers use accounting but concentrate on cash flows and decision making. All these
    activities practiced and exercised by a financial manager are faced to the primary goal of the
    firm, which is to maximize the wealth of the owners for whom the firm is being operated.
    Maximizing the wealth of the owners also means maximizing the value of the firm by also
    satisfying the interests of other stakeholders of the organization first that is why ethical
    behavior is therefore viewed as necessary for achieving the firm’s goal of owner wealth
    maximization.

    To further relate about the role of the financial managers in an organization; the
    division of proprietors and managers of the common firm is illustrative of the work of a
    principal-agent relationship, where the investors or shareholders are the directors or
    principal and managers are the agents or specialists. This game plan functions admirably
    when the managers settles on choices that are in the chief's wellbeing yet can prompt
    organization issues at the point when the interests of the head and manager contrast. A
    company's corporate administration structure is planned to help guarantee that chiefs act in
    the eventual benefits of the association's investors, and different partners, and it is generally
    impacted by both interior and outside component.

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