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Functions of Financial Management

This article is about main functions of financial management. I will describe them and I will try to present you how did functions of financial management change in the last few years. Changes in functions of financial management are strongly connected with changes in general management functions, so I would suggest you to read some other articles about functions of management in general on our site.[ad#ad-4]

Past…

What did financial management do in the past? Their main function was to find the sources or with other words to find the money to support the investments. But who decided where will the money go? Who decided where will the company invest? The upper management.

How did this function work? First then needed to look for all possible ways of financing. Those were usually bonds, stocks and bank loans. Then they had to take a look at costs of future capital and choose the right source of money. Source that was the best for company goals and plans for the future.

Now…

What has changed? Well the main function of financial management is still looking and studying the sources of financing. But financial management now also study the investments. It takes a look at the ROI, time of return and other similar factors. Financial management then as one of their functions decide which investments will company make and how will they finance them. Of course the executive management still has the last word but financial management is playing bigger and bigger role in everything connected with money.

Written by: Matt

We also suggest this relevant article if you have time: Functions of Management in Business Organizations

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