Textbook Notes (368,316)
Canada (161,798)
MGTA02H3 (363)
Chapter 12

Chapter 12- Financial Decisions

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Management (MGT)
Bill Mc Conkey

Chapter 12 Financial Decisions1 Describe the responsibilities of a financial managerTHE ROLE OF THE FINANCIAL MANAGERFinancial managers those managers responsible for planning and overseeing the financial resources of a firmFinancecorporate finance the business function involving decisions about a firms longterm investments and getting the funds to pay for those investmentsInvolves 4 responsibilitiesoDetermining a firms longterm investmentsoGetting funds to pay for those investmentsoCarrying on the firms everyday financial activitiesoHelping to manage the risks that the firm takesObjectives of the Financial ManagerCollect funds pay debts establish trade credit get loans control cash balances and plan for future financial needsIncrease a firms value and stockholders wealthMake decisions for improving the firms financial statusEnsures that a company earns a profitResponsibilities of the Financial ManagerCash Flow ManagementMust ensure that the firm always has enough funds on hand to purchase the materials and human resources that it needs to produce goods and servicesCash flow management managing the pattern in which cash flows into the firm as revenues and out of the firm as debt paymentsFinancial ControlFinancial control the process of checking actual performance against plans to ensure that the desired financial status is achievedInvolves monitoring revenues inflows and making proper financial adjustmentsBudgets provides the measuring stick against performance is evaluatedoCash flows debts and assets can compared at regular intervals against budgeted amounts of each department and the whole companyFinancial PlanningFinancial plan a description of how a business will reach some financial position it seeks for the futureIncludes projections for sources and uses of fundsFinancial manager must think why a firm needs funds and must assess the relative costs and benefits of potential funding sources1
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