What is meant by Financing management?
Financial management refers to the management and control of all financial activities and resources of a company to ensure adequate capital acquisition and utilization. It includes planning, procurement, management, and analysis of capital resources to meet the financial goals and requirements of the company. Financial management plays a crucial role in ensuring liquidity, profitability, and long-term financial stability of a company.
Typical features of software in the area of financial management include:
- Capital Needs Analysis: Analysis of the company's financial needs and determination of the required capital resources.
- Financial Planning: Creation of long-term financial plans and short-term budgets to meet financial goals and obligations.
- Capital Acquisition: Identification and procurement of capital from various sources such as equity, debt, loans, or investors.
- Credit and Creditor Management: Management of credit relationships with banks and other lenders as well as management of creditor payments.
- Investment Evaluation: Evaluation and analysis of investment opportunities as well as profitability calculations for planned investments.
- Liquidity Management: Monitoring and control of the company's liquidity to ensure that financial obligations can be met on time.
- Risk Management: Identification, assessment, and management of financial risks such as interest rate risk, currency risk, and credit risk.
- Reporting: Generation of financial reports and analyses to monitor financial performance and communicate with stakeholders.