Textbook Notes (367,976)
Canada (161,540)
RSM100Y1 (431)
Chapter 20

Chapter 20 notes.docx

7 Pages
Unlock Document

Rotman Commerce
Stojanovic Dragan

CHAPTER 20 FINANCIAL DECISIONS AND RISK MANAGEMENTTHE ROLE OF THE FINANCIAL MANAGERProduction managersplanning and controlling the output of goods and servicesMarketing managersplan and control the development and marketing of productsFinancial managersplan and control the acquisition and dispersal of the firms financial assetsIn other words they are responsible for planning and overseeing the financial resources of a firmFinance or corporate finance typically involves four responsibilitiesDetermining a firms longterm investmentsObtaining funds to pay for those investmentsConducting the firms everyday financial activitiesHelping to manage the risks that the firm takes Objectives of the Financial ManagerCollect funds pay debts establish trade credit obtain loans control cash balances and plan for future financial needsBut overall objective is to increase a firms valueand thus stockholders wealthMake decisions for improving the firms financial status Responsibilities of the Financial ManagerResponsibility of the financial manager to increase a firms wealth falls into three categories cash flow management financial control and financial planningCash Flow Management Is managing the pattern in which cash flows in to the firm in the form of revenues and out of the firm in the form of debt paymentsFinancial Control Is the process of checking actual performance against plans to ensure that the desired financial status is achievedFinancial Planning Describes a firms strategies for reaching some future financial position includes projections for sources and uses of funds WHY DO BUSINESSES NEED FUNDS ShortTerm Operating ExpendituresFirms make them regularly in their everyday business activitiesTo handle these expenditures financial managers must pay attention to accounts payable and receivable inventories and working capitalCredit Policy rules governing a firms extension of credit to customers also sets payment terms
More Less

Related notes for RSM100Y1

Log In


Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.