Objectives of Financial Management

Financial management is the process of planning, organizing, controlling and monitoring financial resources to achieve organizational goals. The objectives of financial management are as follows:

1. Maximize Profit: The primary objective of financial management is to maximize the profit of the organization. The financial manager needs to ensure that all financial decisions are taken in such a way that it leads to the maximization of profit.

2. Wealth Maximization: The financial manager should also focus on maximizing the wealth of the shareholders. The value of the shares of the company should increase over time, which will lead to increased wealth for the shareholders.

3. Optimal Utilization of Funds: The financial manager should ensure that the funds of the organization are utilized optimally. The funds should be invested in projects that yield high returns.

4. Risk Management: The financial manager should also focus on managing risks related to investments, financing, and operations. The risks should be identified, measured, and managed effectively.

Accountancy

Accountancy is the process of recording, classifying, and summarizing financial transactions to provide information that is useful in making business decisions. The objectives of accountancy are as follows:

1. Record Keeping: The primary objective of accountancy is to maintain accurate records of all financial transactions. This is necessary to ensure that the financial statements are accurate and reliable.

2. Financial Reporting: Accountancy also involves preparing financial reports that provide information about the financial performance of the organization. These reports are used by investors, creditors, and other stakeholders to make decisions.

3. Compliance: Accountancy also involves ensuring that the organization complies with all relevant accounting standards and regulations.

4. Decision Making: Finally, the information provided by accountancy is used in making business decisions. The financial statements are analyzed to identify trends and patterns that can be used to improve the financial performance of the organization.

Financial Management

Financial management is the process of planning, organizing, controlling, and monitoring financial resources to achieve organizational goals. The objectives of financial management are as follows:

1. Financial Planning: Financial management involves developing a financial plan that outlines the financial goals of the organization and the strategies that will be used to achieve these goals.

2. Capital Budgeting: Financial management also involves making decisions about investments in long-term assets. This process is known as capital budgeting.

3. Financing Decisions: Financial management also involves making decisions about how to finance the organization's operations. This includes decisions about borrowing, issuing shares, and using retained earnings.

4. Working Capital Management: Finally, financial management involves managing the organization's working capital. This includes managing cash, accounts receivable, and inventory to ensure that the organization has enough liquidity to meet its obligations.