Answer to Question #211256 in Finance for Sphesihle Zuma

Question

Financial management means planning, organising, directing and controlling the financial activities such as procurement and the utilisation of funds of the enterprise. It means applying general management principles to the financial resources of the enterprise. Discuss any 3 of the following functions of financial management and give suitable examples:

1.estimation of capital requirements

2. Determination of capital composition

3. Choice of source of funds

4. Investments of funds

5. Financial controls

Answer 1

1.estimation of capital requirements

The financial managers have a role of estimating funds required for short term and long term. For example the working capital.

2. Choice of source of funds

The financial managers have a role of deciding the sources of funds to be raised. For example from public deposits.

3. Financial controls

Financial managers evaluate the financial performance. For example the budget.