Question

Sound financial management is a key of progress for corporation

Answer 1

The reliability of a company's financial reporting is the key to its success. A company's success is reflected in its financial position.

• Sound financial management involves the provision of funds for the business and then how it is spent on the different activities of the business. It includes the recording of numerical data to be analyzed to help assess the financial health and current financial performance of a business.
• Financial decisions often impact the quantity of a company's current resources. This is because the need for working capital often decreases as long-term investments are expanded.
• Decisions on the structure of long-term investments are part of any company's financial choices. Such decisions include determining whether to use bonds or equity to collect long-term funds depending on the relationship between risk and return.