Principles of Financial Management - MIT School of Distance Education - PowerPoint PPT Presentation

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Principles of Financial Management - MIT School of Distance Education

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There are some principles of financial management that all financial manager should know. Finance is the cornerstone of every business so companies look for finance managers who can maximize profits and minimize losses. If you wish to become a finance manager, then you can pursue Post Graduate Diploma in Management (PGDM) or Post Graduate Diploma in Business Administration (PGDBA) with Finance Management as specialization from MIT School of Distance Education (MIT-SDE). So, apply for this job-centric course right away! – PowerPoint PPT presentation

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Title: Principles of Financial Management - MIT School of Distance Education


1
MIT School of Distance Education
  • Principles of Financial Management

2
  • Financial Management is concerned with
    maintaining finances in a business so that it
    never runs out of cash. It is concerned with the
    financial requirements of a business as well as
    financial planning. Perfect financial management
    facilitates business to make ample profits,
    expand itself and succeed in the long-run. In
    general, there are certain principles of
    financial management

3
  • 1. Expenditure should be less than the revenues
    generated
  • Most of the businesses lose balance over
    finances and are unable to overcome or avoid debt
    because they spend more than the revenues
    generated. However, for a business to sustain its
    position in the long run and to look for further
    growth, it must frequently track its financial
    statement as well as expenses to avoid excessive
    outflow.

4
  • 2. Plan for the unexpected
  • A business should always be well-equipped to
    meet the financial emergencies at any point in
    time. To overcome such point of crisis
    effortlessly, the business must save money and
    put restrictions on its cash outflow. This will
    protect the business in derailing from its long
    term goals or objectives. Thus, financial
    management must be robust to face any kind of
    consequences and achieve the desired goals in a
    limited time period.

5
  • 3. Diversification is not just for investments
  • For any business, investments are believed to be
    the best method to ensure a regular inflow of
    cash. However, businesses should not just rely on
    investment, but they should regularly find
    different ways to generate more revenues.

6
  • Apart from businesses, even employees working in
    a company can finds ways to earn extra income.
    For this, they can look for a part-time business
    or start a small business at their dwellings.
    Thus, this brings a change in overall financial
    profile.

7
  • 4. Organising
  • The very basic step for efficient financial
    management is to organise funds and finances. A
    business must track its different financial
    activities and sources which include brokerage,
    mortgage, loans or credit limit to avoid any
    chaos in the future.

8
  • 5. Understanding risk
  • It is a golden rule that more the risk a
    business takes, more would be its return on
    investment (ROI). However, this is possible only
    if the business has massive information and
    knowledge about finances and investments.
    Usually, investment in shares and bonds are
    considered to be the best source for earning huge
    profits. But, at the same time they involve a
    higher risk too. So, financial managers should
    have an understanding of risks before taking
    them. 

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  • 6. Limited debt
  • To ensure a regular inflow of cash, a business
    must avoid taking unnecessary loans and clear all
    its previous debts. Furthermore, a business must
    opt for loans to procure necessary items only.

10
  • So these were the principles of financial
    management. Finance is the cornerstone of every
    business so companies look for finance managers
    who can maximise profits and minimise losses. If
    you wish to become a finance manager, then you
    can pursue Post Graduate Diploma in
    Management (PGDM) or Post Graduate Diploma in
    Business Administration (PGDBA) with Finance
    Management as specialisation from MIT School of
    Distance Education (MIT-SDE).

11
  • The course trains the candidates to effectively
    manage the finances of the organisation and
    enhance their employability skills. So, apply for
    this job-centric course right away!  

12
  • THANK YOU
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