Question

 a. Heading: Financial Management

 i) Identify one important thing you learned about financial management. 

(1) Explain why this concept is important to you.

Answer 1

Financial management

Management of finance this is the most important thing in financial management. Every organisation is subject to risk,nobody can control risk,but can minimise. The ultimate result of risk is financial loss.If there is experts to carry the risk controlling function,then only the firm can control the financial loss. Management of finance include planning,controlling,organising of finance. If there is proper plan then only they can move further. So before starting anything, the financial analysis should be done. The financial character can be interpreted using financial statement. if it shows a positive result, then we can say that the financial and operational activities are goes good. Finance is the life blood of every organisation.without fund nothing can be done. If a person invest his all savings to any project without any deep study, he may get loss from that investment. If he is well prepared about all investment projects, then he can invest that money in several projects. if one project gives a loss,then the loss can be compensated with profits from other investments.That process can be called as portfolio management. These are all about the management of finance. In case of organisation, by analysing the financial statements like profits and loss account balance sheet ,we will get the detailed result of that business operation. if that is a negative results then they can take additional measures to rectify that. Simply by analysing those results we can manage our financial activity to reduce further risk.