The financial manager’s responsibilities include financial planning, investing (spending money), and financing (raising money). Maximizing the value of the firm is the main goal of the financial manager, whose decisions often have long-term effects.
What are the most important types of decision that the financial manager makes?
Dividend Policy: one of the most important financial decisions that a Financial Manager must make is related to the company’s dividend policy. It concerns how much of the company’s earnings will be paid out to shareholders.
What are 3 fundamental decisions that are of concern the finance team?
Based off the 01 lecture, the primary financial management decisions every company faces include: capital budgeting decisions, financing decisions, and working capital management decisions (Touhey, 2017).
What are the three major decisions of financial management?
The Financial Management can be broken down in to three major decisions or functions of finance. They are: (i) the investment decision, (ii) the financing decision and (iii) the dividend policy decision. 1.
What are the functions of a finance manager?
Some of the important functions which every finance manager has to take are as follows: i. Investment decision ii. Financing decision iii. Dividend decision This decision relates to careful selection of assets in which funds will be invested by the firms.
What are the two types of investment decisions?
The investment decisions can be classified under two broad groups: (ii) Short-term investment decision. The long-term investment decision is referred to as the capital budgeting and the short-term investment decision as working capital management. Capital budgeting is the process of making investment decisions in capital expenditure.
How are financing decisions related to money decisions?
Thus, the most important ones are related to money. The decisions related to money are called ‘Financing Decisions.’ There are three decisions that financial managers have to take: These are also known as Capital Budgeting Decisions. A company’s assets and resources are rare and must be put to their utmost utilization.
