Functions of Financial Manager

•Presented By :

Shristi Giri

Agenda• Who is Financial Manager

• Primary Function

1. Investment Decision

2. Financial Decision

3. Dividend Decision

• Other Functions

Who is Financial Manager?

• Financial managers are responsible for the financial health of an organization. They produce financial reports, direct investment activities, and develop strategies and plans for the long-term financial goals of their organization.

Primary Functions

• Performing Financial Analysis and Planning

• Investment Decision

• Financing Decision

• Dividend Decision

Financial Analysis & Planning

• It refers to an assessment of :• Profitability

• Solvency

• Liquidity

• Stability

Method of Financial Analysis

• Past Performance

• Future Performance

• Comparative Performance

Investment Decision

It is the process of Planning & Management of Long & Short term Investment of an organization.

It involves Risk

Financial DecisionThe important decision which finance manager has to take is deciding source of finance. A company can raise finance from various sources such as by issue of shares, debentures or by taking loan and advances. Deciding how much to raise from which source is concern of financing decisions

Sources of Finance

Dividend Decision• This decision is concerned with

distribution of surplus funds. The profit of the firm is distributed among various parties such as debenture holders, shareholders etc.

• The surplus profit is either distributed to equity shareholders in the form of dividend or kept aside in the form of retained earnings.

Other Functions…• Forecasting Future profit

• Allocation of Funds & Resources

• Take care of the share holders

• THE HISTORY OF FAILURES OF ORGANISATIONS IS INTERESTING. MANY FIRMS HAVE FAILED, NOT BECAUSE OF INEFFICIENCY OF PRODUCTION, INABILITY IN MARKETING OR NONAVAILABILITY OF FUNDS BUT DUE TO THE ABSENCE OF COMPETENT FINANCE MANAGER