Means of Financing – If you Are struggling To Know Definition of Finance Or Means of Financing / Financial Management, Now you are in rights place. “Why Should You Know Means of Financing / Financial Management ” As a reader, ask yourself the question now. To answer this question, you need to know the answers two questions.
What is finance? And 2. What is the role of financing in all the activities of a firm?
Simply put, financing is related to financial decisions, or, more appropriately, to cash flow.
Financial decisions are primarily concerned with how business, government, and an individual will grow and use their money.
We will see in this article that proper financial management helps a business to deliver goods to its buyers at the lowest prices, pay higher salaries to its workforce and give maximum profit to those who have invested and run the business.
The reason is that both the country and the world hold money – buyers, workers and investors. And it is selfless to say that strong and timely financial management contributes to the welfare of individuals and the general public.
In This Article will review the overall aspects of financial management and Means of Financing. By the end of the article, you will learn about how financial knowledge is being used in the business world and how it affects current and future financial management.
Definition of Finance Or Means of Financing:
The term Definition of Finance comes from the English word Finis. Its literal meaning is to raise money. From the above discussion we have found the relationship of three units related to finance and financial management. Individuals, businesses and governments.
There is no option to raise money for financial activities or financial transactions of three units. Therefore, Finance in short, means to identify the source of raising money and to raise money.
Such funding and its proper and efficient use and the performance of related functions require a well-planned and sound plan, scientific policy, organized structure, practical formulas, useful methods and timely techniques.
So in general, financing is the process of maximizing the assets and assets of an organization through adoption of financial plans, various term or one-time financing from the most convenient source as planned, planned investment in profitable sector, maintenance, coordination and control.
Definition of Finance With Various Author Financier:
Scott and Brigham say, Financing – the depiction of cash flow, whether related to financial decision making or, more appropriately.
According to L. J. Gitman, Finance is concerned with decisions about money or more appropriately, cash flows. Finance is concerned with the process, institutions, markets and instruments involved in the transfer of money among individuals, businesses and governments.
According to Schall and Halley, Finance is a body of facts, principles and theories dealing with raising and using of money by individuals, businesses and governments.
Encyclopedia of Britannica – Finance is the act of providing the means of payments.
George R. Terry Say, Finance consists of providing and utilizing the money, capital rights credit and funds of any kind which are employed in the operation of an enterprise.
Types of Finance:
- a. Both science and art.
- b. Fundraising and its investment.
- c. Maintains the money collected and disbursed.
- d. Relates to cash flows.
The Scriptures on Fundraising Decisions, Investment Decisions and Security Provisions, Proper Use, Proper Control and Coordination, and the Implementation of All Techniques.
Definition of Business Finance:
Finance Review of the Origins and Evolution of Financial Management We have seen that every decade or every year has changed to ensure a change in financing, increased coverage and scope.
As a result, its definition has to be changed. Its functions have also been included in the definition of business finance in changed circumstances. Although business finance in the general sense refers to the collection of money or loans for a business, its scope is wide in terms of its effectiveness.
So business finance in general is about determining the source, collection and use of money, proper planning for these activities, scientific ideological principles, effective structures, theories and formulas, methods and techniques.
Business financing, therefore, is a method of action that is defined differently at different times by different authors who are active in formulating and financing an individual, organization and government through the collection and disbursement of funds. There was no difference.
Definition of Business Finance With Different Financier Author:
- James C. Van Horne Say, “Financial management is concerned with the acquisition, financing, and management of assets with some overall goal in mind.” Such as- investment, fundraising and asset management. This has been discussed elsewhere in the chapter.
- According to Judge R. Terry, “Business financing is all about finances, money use, savings, debt, spending, and so on.
- According to Ernest W. Walker, “Activities of a business concern relevant to financial planning, co-ordination, control, and their application is called finance.” And the proper application of these is called business financing.
- In the words of Raymond P. Neveu, financial management is the management of the source and use of money for a specific goal. In the definition discussion, he refers to the sources of money or funds as the liabilities and capital side of the balance sheet and refers to the use of money as the assets side of the balance sheet.
He also identified financial management as two different functions. Such as- a, financing and b. Investment. Financing has been shown to mean the management of sources of money and the management of funds and investment means the use of money management.
- Prof. Gloss and Baker say, “Business finance is concerned with the sources of funds available to enterprises of all sizes and the proper use of money or credit obtained from such sources.” Business financing involves the proper use of funds raised or loans.
In addition to the above definitions, business financing is an ongoing process that is characterized by the identification of all possible sources of funding and the maintenance and upkeep of the firm’s financial objectives through its proper maintenance. Hope now clear Definition of Finance Or Means of Financing/ Means of Business Financing: Financial Management.