Finance function is concerned with all functional areas of a business e.g production, marketing ,personnel ,purchasing ,research ..

1. Concept of finance
• Finance is the life blood of every business
organization
• Finance is procurement of funds to meet the
financing needs of different business organisation
• Finance function is concerned with all functional
areas of a business e.g production, marketing
,personnel ,purchasing ,research and
development and so on .
• Finance is procurement of funds and wise
application of funds

2. Types of finance
• Public finance –Analyses how do different public
authorities deals with the management of their finance
like state government ,municipal corporations etc
• Private finance – means the finance of a person and
private institutions, it studies how different persons
and private institutions obtain their funds and how
they spend their funds for the accomplishment of their
objectives
• It is further divided into three parts
• a}personal finance
• b} business finance
• c}non profit making institutions finance

3. Types of finance
• Institutional finance -This area of finance focuses
capital formation and meets the financial
requirements of the economy.
• Financial institutions are like banks,insurance
comapanies ,financial corporations etc
• International finance – it focuses attention on
flow of funds beyond national boundaries .it
studies flow of funds between individuals and
organisations across national borders and
development of methods handling the flows
more efficiently .

4. Finance and other discipline
• Finance and economics – finance is derived
from economics , finance person should
understand both the micro and macro aspect
of economics .through which finance
manager came to know about monetary
policy ,fiscal policy, economic policy ,demand
and supply relationship ,law of returns and
product pricing strategies.

5. Finance and accounting
• Accounting provides input that provides a
manager with valuable data for making
analysis and preparing reports that are used in
decision making .

6. Finance and production
• The activities of production department revolves
around smooth flow of production to ensure that no
short fall in the production take place . It is
responsibility of production manager to take care his
department in such a manner that optimum
utilisation of fund invested in various form like plant
,machinery and material etc and minimisation of
wastage and idle time of labour.
• finance manger should coordinate production
manager in taking suitable decision and thus
maximisizing profits .

7. Finance and cost accounting
• Cost accounting helps in providing cost
information to the finance manager and thus
he can keep a check on operational costs
under control and leads to proper utilisation
of resources .

8. Finance and planning
Planning department uses data generated b the
finance department for effective future plan and
working schedules.

9. Finance and personnel
• The role of personnel department is to
recruitment ,selection and training and
remuneration handling etc .hence it should
coordinate with finance team in deciding the
remuneration ,bonus and other incentives
part

10. Finance and assets management
• Finance department is concerned with
acquisition ,proper maintenance and
utilisation of firm’s both current and fixed
asset .he always coordinate with the asset
management officer in decision making
regarding current and future utilisations of
firm’s asset for achieving goals in best possible
manner .

11. Finance and marketing
• The main objective of an organization is to
ensure that the goods produced or
manufactured are sold at profit.
• In order to maximize profit marketing
department in coordination with finance
department must decide various strategies
like credit facility ,discount scheme and other
promotional strategies.

12. Business finance
• Business finance can be broadly defined as an
activity concerned with planning ,raising
,controlling and administering of funds used in
the business .
• It includes the activities for obtaining finance
from different sources for business
requirements and managing it for fulfilment of
business objectives .

13. Corporate financing
• It is concerned with the efficient and effective
management of finance by a corporate body
to achieve its objectives .
• It serves two important functions :
• a.)it is a means of assembling the funds
necessary to initiate any new business
• B.)it provides the basis for continued
operations

14. Financial forecasting
• A financial forecast is an estimate of future
financial outcomes for a company. Financial
forecasts estimate future income and expenses
for a business over a period of time, generally the
next year.
• Financial forecasts can use historical accounting
and sales data, and external market and
economic indicators, to predict what will happen
to the company in financial terms over the given
period of time.