Question

What is financial management? What is the main objective of financial management?

Answer 1

1.  Financial management means planning, organizing, directing and controlling the financial activities such as procurement and utilization of funds of the enterprise.
2.  It is an activity which is concerned with acquisition and conservation of capital funds in meeting financial need an overall objectives of business organisation.
3. It means applying general management principles to financial resources of the enterprise.

The main objectives of financial management is wealth maximization of shareholder’s wealth.

1. To ensure regular and adequate supply of funds to the concern.
2. To ensure adequate returns to the shareholders.
3.  To ensure optimum funds utilization. Once the funds are procured, they should be utilized in maximum possible way at least cost.