BBPW3103 financial management is an activity that ensures a business has a sound capital structure. Fundamentally, it is the application of the general principles of management to an enterprise’s financial possession. Moreover, it is the process of planning, controlling, organizing, and monitoring the financial resources of an organization to achieve the organizational goals and objectives. It is a crucial practice to control the financial activities of an organization such as accounting, risk assessment, procurement of funds, and payments. Managing an organization’s finance properly ensures regular service for efficient functioning. Antagonistically, if it does not deal with its finances properly, it will face barriers that hinder its growth and development.
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THE OBJECTIVES OF BBPW3103 FINANCIAL MANAGEMENT
Fundamentally, BBPW3103 financial management ensures a regular and adequate supply of funds to an organization. Resultantly, this enables to accomplish its goals and objectives. Additionally, it ensures that the stakeholders receive adequate returns depending on the earning capacity, their expectations, and the market price of the share. Furthermore, it helps an organization to utilize its funds optimally through procurement. It promotes the safety of investment of a firm to achieve an adequate rate of return. Moreover, financial management helps to plan a sound capital structure that maintains a balance between equity capital and debt.
THE ADVANTAGES OF A SOUND CAPITAL STRUCTURE
A sound capital structure finds the right equilibrium between equity and debt hence the business can leverage it to grow. Additionally, it amplifies the potential earnings of a firm. It helps to establish better control and management of operational flexibility. It is also crucial for effective BBPW3103 financial management. Moreover, the capital structure provides flexibility in raising funds to meet the goals and objectives of an organization. Also, its capital structure provides proper ways of raising capital.
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