Difference between revisions of "Financial Manager"
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(Replaced content with "Financial Manager Category:finance Category:M12 Category:Term") Tag: Replaced |
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| − | + | In [[Principles of Corporate Finance|Principles of Corporate Finance]] a financial manager's role is to answer two questions: | |
| + | 1) Which [[Real assets|Real assets]] should the firm invest in? | ||
| + | 2 How should the cash for the investment be raised? | ||
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| + | <html><img src = "/static/files/MBI/Module%2012/financialmanager.PNG" width="600"/></html> | ||
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| + | # The flow starts when the firm sells securities to investors to raise cash | ||
| + | # The cash is used to purchase real assets | ||
| + | # If the firm does well, the return on these assets generate cash flows that more than repay the initial investment | ||
| + | # | ||
| + | ## This cash can be reinvested in the firm | ||
| + | ## Or return to the investors who bought the securities | ||
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| + | Three types of financial managers exists: | ||
| + | # The '''Treasurer''', responsible for cash management, raising capital and banking relationships, common in small firms | ||
| + | # The '''Controller''', responsible for preparation of financial statements, accounting and taxes, next step for larger firms | ||
| + | # The '''CFO''', responsible for financial policy and corporate planning, required for still larger firms | ||
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[[Category:finance]] | [[Category:finance]] | ||
Latest revision as of 19:24, 27 August 2020
In Principles of Corporate Finance a financial manager's role is to answer two questions: 1) Which Real assets should the firm invest in? 2 How should the cash for the investment be raised?
- The flow starts when the firm sells securities to investors to raise cash
- The cash is used to purchase real assets
- If the firm does well, the return on these assets generate cash flows that more than repay the initial investment
-
- This cash can be reinvested in the firm
- Or return to the investors who bought the securities
Three types of financial managers exists:
- The Treasurer, responsible for cash management, raising capital and banking relationships, common in small firms
- The Controller, responsible for preparation of financial statements, accounting and taxes, next step for larger firms
- The CFO, responsible for financial policy and corporate planning, required for still larger firms
