COMMERCE 1E03 Chapter Notes - Chapter 14: Initial Public Offering, Debenture, Investment
7 Apr 2013
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What is finance? and what do financial managers do? . Finance: a functional area of business that acquires funds for the firm and manages those funds within the firm. Activities include preparing budgets; doing cash flow analysis; and planning for the expenditure of funds on such assets as plant, equipment, and machinery. Financial management: the job of managing a firms resources so it can meet its goals and objectives. Financial managers: examine the financial data prepared by accountants and make recommendations to top executives regarding strategies for improving the health (financial strength) of the firm. Financial decisions can only be made if you can understand accounting information. Three most common ways for a firm to fail financially: undercapitalization (lacking funds to start and run the business, poor control over the cash flow, inadequate expense control. Parsley patch inc. was created by bertani and sherwood but they failed because they were not financial experts.
