Question

What is financial planning? Explain three points of importance of financial planning for a business organization.

Answer 1

Financial planning helps you determine your short and long-term financial goals and create a balanced plan to meet those goals.
Importance of financial planning :

(i) Financial planning provides policies and procedures for the sound administration of the finance function.

(ii) Financial planning results in preparation of plans for the future. Thus, new projects could be undertaken smoothly.

(iii) Financial planning ensures the required funds from various sources for the smooth conduct of business.