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44284194 Ppt on Finance
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TYPE OF FINANCE
Finance Group
Short term Middle term long term
Four type of finance
• Self Financing:-Fund from private and family sources
• Debt Financing:- Borrowing money from others.
• Equity Financing:-By sale of an interest in the business.
• Other Financing:-Other sources such as Trusts and Grants.
PURPOSE OF FINANACEStart a new business.Buy a business.To buy asset such as plant and equipments.For working capital.To raise capital that can be return to share
holder or to the owner.To arrange fund to buy out a partner or a
share holder.
HIERARCHY OF FINANCE
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CEO
CFO DIRECTOR OF FINANCE ------------------------------------------------------------------
MANAGER ACCOUNT
MANAGER TAXATION
MANAGERFINANCE
MANAGERPAYROLL
A.MANANGER
A.MANANGER
A.MANANGER
A.MANANGER
EXECUTIVEACCONTENT
EXECUTIVEACCONTENT
EXECUTIVEACCONTENT
EXECUTIVEACCONTENT
MANAGEMENT TRAINEE
MANAGEMENT TRAINEE
MANAGEMENT TRAINEE
MANAGEMENT TRAINEE
Career Opportunities in Finance
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Corporate Finance Functions
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Financial Management
External Financing
Capital Budgeting
Corporate Governance
Risk Management
Corporate Finance
Functions
The Financial Management Function
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Managing firms’ internal cash flows, and its mix of debt and equity financing,to maximize the value of the debt and
equity claims on firms, and to ensure that companies can pay off their
obligations when they come due. Involves obtaining seasonal financing,
managing inventories, paying suppliers, collecting from customers, and investing surplus cash
The Risk Management Function
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Managing firms’ exposures to all types of risk,
both insurable (such as loss caused by fire or flood) and uninsurable,
in order to maintain optimum risk-return trade-offs and thereby maximize shareholder value.
Modern risk management focuses on adverse interest rate movements, commodity price changes, and currency value fluctuations.
The Capital Budgeting Function
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Capital Budgeting – selecting the best projects in which to invest the resources of the
firm, based on each project’s perceived risk and expected
return.
Select investments for which the marginal benefits exceed the marginal costs.
The Scope of Corporate Finance
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Financial managers should seek to maximize shareholders’ wealth.
How? By performing the five basic duties of corporate finance: External financing, capital budgeting, financial management, risk management, corporate governance.
Select investments for which the marginal benefits exceed the marginal costs.
Port Folio Management.Studying various aspect of accounting
terminology.
Limitation of finance department in an organizationion
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Problem of accuracy :Rigidity and inflexibility in administration:External constraints:Always base on assumption :High concentration of authorities:Could not take independent decisions:Not every time have an ability to tackle
emergency situations:More concentration requiresProblem in allocation of finance
COMPETENCIES
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AccuracyMonitors accuracy of own transactionsRecords transactions accuratelyMaintains accurate recordsRecognizes and corrects errors
Cash HandlingComplies with established proceduresMaintains accurate cash flow recordsResolves cash discrepanciesMonitors access to fundsAudits funds
SummarySummary
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As the speculation of industry professionals go, it’s definitely going to be an upswing for the finance sector. At present, the finance sector is getting transformed into a technology-intensive and customer-friendly model with a focus on convenience. The role of an integrated financial infrastructure is to stimulate and sustain economic growth. Finance will have a significant contribution in propelling India forward as a global economic power.
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