Need of Accounting

_{Accounting has rightly been termed as the language of business. The basic function of a language is to serve as a means of communication. Accounting also serves this function. It communicates the results of business operation to various parties who have some stake in the business viz the proprietor, creditor, investors, government and other agencies. Though accounting is generally\ associated with business yet it is not only business which make use of accounting. Persons like housewives, government and other individuals also make use of accounting. For example, in case the housewife records her transactions regularly, she can collect valuable information about the nature of her receipts and payments. For example she can find out the total amount spent by her during a period on different items say milk, food, education, entertainment etc. Similarly she can find the source of her receipt as salary, rent from property, cash gifts from her relatives thus at the end of the period she can see for herself about her financial position i.e. what she owes and what she owns. This will help her in planning her future income and expenses (or making out a budget) to a great extent.}

1. _{The need for accounting is all the more greater for a person who is running a business. He must know: -         (i) what he owns                                                                (ii) who he owes                                                                (iii) whether he has earned a profit or suffered a loss on account of running a business                                         (iv) what is his financial position i.e. whether he will be in a position to meet all his commitments in the near future or he is in the process of becoming a bankrupt.}

 

Nature and Scope of Financial Management

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.

Objectives of Financial Management

The financial management is generally concerned with procurement, allocation and control of financial resources of a concern. The objectives can be-

1. To ensure regular and adequate supply of funds to the concern.

2. To ensure adequate returns to the shareholders, this will depend upon the earning capacity, market price of the share, expectations of the shareholders.

3. To ensure optimum funds utilization. Once the funds are procured, they should be utilized in maximum possible way at least cost.

4. To ensure safety on investment, i.e., funds should be invested in safe ventures so that adequate rate of return can be achieved.

5. To plan a sound capital structure-There should be sound and fair composition of capital so that a balance is maintained between debt and equity capital.

The Marketing Concept

_{The foregoing discussions on the difference between selling and marketing lead us to the marketing concept. The marketing concept emerged in the mid-1950s. Instead of a product-centered, “make-andsell” philosophy, business shifted to a customer-centered, “sense-and respond” philosophy. Instead of “hunting,” marketing is “gardening.” The job is not to find the right customers for your products, but the right products for your customers. The marketing concept holds that the key to achieving organizational goals consists of the company being more effective than competitors in creating, delivering, and communicating superior customer value to its chosen target markets. The marketing concept was born out of the awareness that a business should start with the determination of consumers wants and end with the satisfaction of those wants. The concept puts the consumer at both the beginning and the end of the business cycle.}

The Meaning of Marketing

_{The term ‘market’ originates from the latin noun ‘Marcatus’ which means “a place where business is conducted”. A layman has somewhat similar connotations of the world market which brings to his mind a place where the buyers and sellers personally interact and finalize deals. William J. Stanton has defined marketing as “a total system of interacting business activities designed to plan, price, promote and distribute want satisfying product and services to present and potential customers.}

_{H.L. Hansen defines marketing as the process of discovering and translating consumer needs and wants into product and service specification, creating demand for those products and services and then in turn expanding this demand. Philip Kotler defines marketing as the set of human activities directed at facilitating and consummating exchanges. The essence of marketing is exchange of products and the transaction is to satisfy human needs and wants.}

The Societal Marketing Concept

_{The societal marketing concept calls upon marketers to build social and ethical considerations into their marketing practices. They must balance the conflicting criteria of company profits, consumer want satisfaction, and public interest. Yet a number of companies have achieved notable sales and profit gains by adopting and practicing the societal marketing concept.}

_{The societal marketing concept holds that the organization should determine the needs, wants and interests of target markets. It should then deliver the desired satisfactions more effectively and efficiently than competitors in a way that maintains or improves the consumer’s and the society’s well-being. The societal marketing concept is the newest of the five marketing management philosophies. The societal marketing concept calls upon marketers to build social and ethical considerations into their marketing practices.}

_{This is an extension of the marketing philosophy wherein marketing philosophy is put into action and practice. By implementation of marketing concept to achieve the maximum consumer satisfaction, sometimes the larger social interests are ignored and overlooked by the marketers. e.g. customer prefers Frooti tetrapacks. Tetrapacks are bio non-degradable. They litter the environment with waste materials and create. In the societal marketing, eco-friendly packages are developed. Now eco-friendly products are available. The purpose is to fulfill the social responsibilities of the business and to achieve maximum social welfare. Marketing companies producing bady milk powder, advertise that mother’s milk is the best milk. The social responsibility of marketers demands that they should act as agent of change. They have an obligation towards society to bring about positive changes in social values. The process of marketing should be so used that they may help in social participation and enlightenment. It is aimed at generating customers satisfaction and long-term consumer and public welfare as a key to satisfying organizational goals and responsibilities.}

Functions of A Finance Manager

The twin aspects viz. procurement and effective utilization of funds are the crucial tasks which the finance manager faces. The financial manager is required to look into the financial implications of any decision in the firm. Thus all decisions involving management of funds comes under the preview of the finance manager. A large number of decisions involve substantial or material changes in the value of funds procured or employed. The finance manager has to manage funds in such a way so as to make their optimum utilization and to ensure that their procurement is in a manner so that the risk, cost and control considerations are properly balanced under a given situation. He may not however, be concerned with the decisions, which do not affect the basic financial management and structure.

Management as a Social Responsibility

_{In the past, business manager had only one responsibility:that is to make money for the owners.That era of ‘economic man’ is ended. Today, the concept of ‘welfare state’ and with it the idea of socialresponsibility has come to stay in many countries of the world. Frank Abrahms perphaps best expressed this new philosophy when he said that the job of management is to conduct the affairs of the enterprise in its charge in such a way as to maintain an enquitable and workable balance among the claims of variousinterested groups.}

_{Today’s manager is not a mere law observer but a solver of society’s problems. It is argued that managers must consider the impact of their decisions and actions on society as a whole. They should take steps to protect and improve the welfare of society. They should manage the quality of life by helping develop solutions for society’s ills. According to Keith Davis, the term ‘social responsibility’ refers to both socio-economic and socio-human obligations to others. It is the obligation of management to engage in activities that protect and contribute to the welfare of society. H. R. Bowen has defined social responsibility as obligations of the manager to pursue  thosepolicies, decisions , or to follow those lines of action which are desirable in term of objectives and values of our society. Management has very positive responsibilities to various group such as its stockholders, employees, customers, suppliers, competitiors, influence groups, the general public and the government.}

Sales Management Operations

_{Sales Operation refers to various activities, which help in the timely achievement of sales targets for the successful functioning of an organization. Sales Operation activities help the sales professionals to meet the sales targets in a systematic and the best possible way. In simpler words sales operation activities help in generating revenues for the organization through meticulous planning, better budgeting and adopting a methodical approach.}

Project Management

_{Project management is an organized venture for managing projects. It involves scientific application of modern tools and techniques in planning, implementing, monitoring,}

_{controlling and coordinating various activities or tasks to produce desirable output in agreement with pre-determined objectives within the constraints of time, cost, quantity and quality.}

_{According to Prof. Harold Kerzner “Project management is the process of achieving}

_{project objectives through the traditional organizational structure and over the specialties}

_{of the individuals concerned. Project management is applicable for any (unique, one}

_{time, one of kind) undertaking concerned with specified objectives.”}