Scope and Objectives of Financial Management

executive program by IIM calcutta

Financial management is a critical aspect of personal and business life. It involves the planning, implementation, and monitoring of financial resources to achieve financial goals and maximise wealth. Effective financial management can help individuals and businesses to make the most of their resources, minimise risk, and achieve long-term financial stability. The scope of financial management covers a wide range of topics, including planning, budgeting, assessing risks, and monitoring performance.

Let us dive into the functions, scopes and objectives of financial management.

How would you define financial management?

The managerial task of planning and controlling a company's financial resources is known as financial management. Acquiring, financing and managing assets are required to accomplish a corporate firm's primary goal (i.e. maximising the shareholder’s value).

Functions of financial management


The first and foremost key to running any corporation is planning. Financial planning involves setting financial goals and determining the capital needed to achieve those goals. It includes preparing budgets and cash flow projections, as well as determining the best sources of financing.

Acquiring funds 

Financial management entails gaining the finances required to accomplish an organisation's financial objectives. Issuing bonds or stocks, obtaining loans, or finding other sources of capital are a few examples of acquiring funds.

Investment decisions 

Financial management entails making investment decisions to maximise return while minimising risk. This might include purchasing stocks, bonds, real estate, or other assets.

Financial analysis 

Financial analysis is the process of assessing a company's financial performance. Analysing financial statements, comparing actual outcomes to budgeted results, and identifying areas for improvement are a part of this process.

Risk management 

It involves managing financial risk in order to minimise the impact of financial uncertainties on an organisation's financial performance. Risk management can be done using hedging strategies, insurance, and much more.


Financial management involves preparing and presenting financial reports (balance sheets, income statements, and cash flow statements) to stakeholders, such as shareholders, creditors, and regulators.

Scope of financial management

Working capital management

It involves managing an organisation's day-to-day finances, including cash, accounts receivable, and accounts payable.

Financial forecasting

It entails making predictions about future financial performance based on past performance and other relevant parameters.

Financial forecasting is a complex process that requires a thorough understanding of the organisation's historical financial performance and an assessment of the current economic and market conditions. This process also requires the use of statistical techniques and financial models.

International financial management 

It involves making decisions about financial operations in international markets, including foreign currency exchange risk and the management of international investments.

Objectives of financial management

Profit maximisation 

It seeks to generate the highest level of profits possible, given the resources available to an organisation ghostwriter agentur. Typically measured in terms of net income, it maximises the difference between an organisation's revenue and its expenses. 

Wealth maximisation

It is a financial management objective that aims to increase an organisation's total value, as measured by its market capitalisation or the value of its assets. 

In contrast to profit maximisation, which focuses on short-term profits, wealth maximisation considers the long-term impact of financial decisions on an organisation's value. 

Liquidity management

It is a key component of financial management that involves ensuring that an organisation has enough cash and other liquid assets to meet its short-term obligations ghostwriter. It includes controlling the organisation's cash inflows and outflows and ensuring enough liquidity to pay operational expenditures and satisfy financial commitments when they become due.

Solvency management

The debt capital market can play an important role in ensuring the solvency of organisations by providing a source of long-term financing that can be used to meet obligations over the long term.

Asset management

It involves making decisions about the acquisition, use ghostwriter seminararbeit, and disposal of an organisation's assets to maximise their value.

Capital structure management 

The debt capital market can be a valuable source of financing for organisations seeking to optimise their capital structure bachelorarbeit schreiben lassen kosten. By issuing debt securities, organisations can access a reliable source of long-term financing while also taking advantage of a lower cost of capital compared to equity financing.

Dividend policy

Dividend policy involves making decisions about the distribution of an organisation's profits amongst its shareholders in the form of dividends or share buybacks.


Are you ready to take your financial management skills to the next level and gain a competitive edge in the investment banking and capital markets industry? Look no further than the Executive Programme in Investment Banking and Capital Markets by Imarticus in collaboration with IIM Calcutta. 

This comprehensive course will equip you with the knowledge and skills required to succeed in this exciting field. You'll learn about financial planning, investment decisions, risk management, and more. With a combination of expert instructors and cutting-edge course content  bachelorarbeit schreiben lassen kosten, you'll gain a deep understanding of the industry and be ready to take on any challenge. So, why wait? Enrol in the programme today and start your journey to success!

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