Why the Financial Manager is required and What are its functions?

Financial Manager is an individual whose primary responsibility is to keep the company financially sound and healthy, a company who is having huge amount involved the special person is hired in order to make proper use and allocation of these funds.

In the companies mostly in the large companies like corporate companies these companies do not have much capital of their own, the company borrows money from the different financial institutions like bank and also they do offer the bonds in general public.

Once the money is received from the sources the acquisition of money is not such a big deal but to utilize that money in a proper manner is an issue, the money which is borrowed it has be repaid as well otherwise it will not be an easy task to repay the debt.

The financial manager is a person who makes an estimation regarding the financial need for a company that how much amount is need for any requirement, financial managers make the decisions regarding the structure of the capital and they have also responsibility to select the source of the finance either the finance should be asked from the general public in the shape of shares and bonds or it must be borrowed from the financial institution as a loan.

Once the capital is acquired now the next step for a Financial Manager is to select the pattern of investment, investing the complete amount in a single project can be risky here the investment in different areas must be a wise decision because if unfortunately the project could not get much success as expected its requirement can be filled from the shared investment.

Here the proper management of the cash is much valued the financial managers implement such plans in order to control the cash flow of the company, the proper use of surplus amount can lead company to success.

The functions of Financial Manager can include to forecast the financial planning and the methods for the acquisition of funds, investment of those acquired funds and help in the valuation of decision.

Companies which are specially joint stock company in these companies financial manager has to decide regarding the mean either it should be a short term loan or the long term loan in order to make sure that the funds are not borrowed in surplus.

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