What do you mean by financial management also describe its different aspects?
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Simply put, financial management deals with raising finance for the business to meet short term and long term requirement, mobilisation of funds, control over its use and creating a balance, i.e. trade-off between risk and return.
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Financial Management refers to efficient acquisition of finance, efficient utilisation of finance and efficient distribution and disposal of surplus for smooth working of company.
The aspects of Financial Management are:
(a) Optimum procurement of funds
The firm acquires funds from an array of sources such as debentures and bonds, equity shares and preference shares, commercial banks, venture capital, angel financing, hire purchases and leasing.
(b) Optimal utilisation of funds
The acquired funds needs to be invested in a manner that the returns from the investment exceed the cost at which procurement has taken place.
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