Financial management in construction technology PPT.pptx
1. INTRODUCTION
• Finance is the art and science of managing money.
• It is the study of value.
• It assets to achieve financial goals efficiently.
• It includes activities such as investing, borrowing, lending, budgeting,
saving and forecasting.
2. KEY ISSUES IN FINANCE
• Funding: Where to raise financial resource from.
• Investment decisions: Making decisions about where to invest money.
• Risk Management: Identifying, assessing, and mitigating financial risks.
• Capital Allocation: Efficiently allocating funds to maximize returns.
• Financial Markets: Understanding and navigating the complexities of
financial markets.
3. FINANCIAL MANAGEMENT
• Financial management is the strategic handling of money and assets to
meet goals efficiently.
• It involves planning, organizing, directing, controlling and monitoring
resources of an organization.
4. PLANNING
• It is the process of estimating the current financial situation of a
business to identify future financial goals and how to achieve them.
• It reflects the current status of business, what progress they intend to
make, and how they intend to make it.
5. ORGANIZING
• Organizing refers to structuring financial resources, processes, and
systems to execute the financial plans effectively.
• It decide what actions and resources are needed. It determines who
will do a distinct job, where and when it will be done.
6. DIRECTING
• Directing in financial management involves providing leadership, guidance,
and oversight to ensure that financial activities are carried out in line with
organizational objectives.
• This includes making strategic financial decisions, such as investment
choices, financing options, and capital allocation, as well as motivating and
managing finance teams to achieve performance targets.
7. CONTROLLING
• It involves monitoring actual financial performance against planned
targets, identifying variances, and taking corrective actions as
necessary.
• This includes implementing financial controls, conducting financial
analysis, and reviewing financial reports to ensure accuracy and
compliance with policies and regulations.
8. MONITORING
• Continuously tracking financial performance, assessing the effectiveness of
financial strategies, and adjusting plans and actions as needed.
• This includes regularly reviewing key performance indicators (KPIs),
conducting financial reviews or audits, and staying informed about changes
in the external environment that may impact financial outcomes.
9. IMPORTANCE OF FINANCIAL
MANAGEMENT
• Resource Allocation: Ensures efficient use of funds and assets.
• Decision Making: Guides strategic financial decisions for growth and
stability.
• Profitability: Enhances revenue generation and cost control for increased
profits.
• Planning and Forecasting: Facilitates budgeting and forecasting for future
financial health.
• Stakeholder Confidence: Builds trust and confidence among investors and
other stakeholders.
• Sustainability: Supports long-term financial health and organizational
stability.
