Finance And Investment
By admin | July 5, 2008
Finance is the general term applied to the commercial service of providing funds and capital. This is part of the area of economics that focuses on the strategies and methods of looking after money and other financial assets. If you prefer, it can also be a general term which encompasses the entire subject of managing and supplying money in the business and private sector. Management of finance has also developed into a specialized branch within the financial sector and is carried out by finance managers.
Managing this involves dealing with the optimization and allocation of funds to various areas either by borrowing or by using those available from internal resources. The function of the finance manager is to Optimize or enable the fund to be made available with as little cost to the company but provide for a profit to be made in this process. The fact is that it governs most of the worlds activities and poor finance management will immediately show up as conditions deteriorate in procurement, production and sales as it affects every sphere of business activities. That is why, a fund managers job is stressful as they must be careful where they allocate their funds and the potential risk involved thereafter.
It has been said by a number of people that finance managers can often be ‘time’ short sighted as they rarely look a the long term ‘bigger picture’. Finance managers are the pessimists whereas sales managers are the optimists who look to the future and not to the past! Unfortunately when you are running a small business, the boundary lines between a personal loan and a business loan can be a little blurred and often the planned arrangement is not used as was not used for its original purpose. Most lenders will cancel the loan if they feel they have been deceived this way because they are unsure what the money is to be invested in.
The aim is to educate businesses to act more responsibly when it comes to managing these issues and as a consequence their business. However, small businesses can finance their needs from other sources like friends or from banks and private lenders. However, finance managers are in the position of making money for their company so out sourcing their lending can help increase their profits. The famous comedian Bob Hope best summed up the subject when he once said; a bank is a place that will lend you money but only if you can prove that you don’t need it.
Tags:
Topics: Credit Card |