The term
financial management has emerged from the generic discipline of management. In
order to understand financial management, it is better to start with an
understanding the term management. Management, simply put, is all about
securing the optimal use of the resources at the disposal of the firm towards
the attainment of some predetermined goals. These resouces are of many kinds
such as human capital, production machines, distribution channels etc.Resources
are put under the charge of respective departments which have the
responsibility of their management and control. Each department contributes
towards the organisational objectives by effectively managing the resources
they are controlling. Many terms such as capital, funds, cash flow, money etc.
are used synonmously and interchangeably to describenfinancial resources. The
finance department of the organisation is responsible for the financial
management of the firm, which it does through the means of financial decision
making.
