Friday, December 8, 2017

Functions of Financial Officer

Leave a Comment

Functions of a Chief Financial Officer / Finance Manager

The twin aspects viz procurement and effective utilization of funds are the crucial tasks, which the CFO/Finance Manager faces. The Chief Finance Officer / Finance Manager is required to look into financial implications of any decision in the firm. Thus all decisions involving management of funds comes under the purview of CFO / Finance Manager. These are namely

-       Estimating requirement of funds
-       Decision regarding capital structure
-       Investment decisions
-       Dividend decision
-       Cash management
-       Evaluating financial performance
-       Financial negotiation
-       Keeping in touch with stock exchange quotations & behavior of share prices


Role / responsibilities of Finance Manager in the Changing Scenario of Financial Management in India

In the modern enterprise, the finance manager occupies a key position and his role is becoming more and more pervasive and significant in solving the finance problems. The traditional role of the finance manager was confined just to raising of funds from a number of sources, but the recent development in the socio-economic and political scenario throughout the world has placed him in a central position in the business organization. He is now responsible for shaping the fortunes of the enterprise, and is involved in the most vital decision of allocation of capital like mergers, acquisitions, etc. He is working in a challenging environment which changes continuously.

Emergence of financial service sector and development of internet in the field of information technology has also brought new challenges before the Indian finance managers. Development of new financial tools, techniques, instruments and products and emphasis on public sector undertakings to be self-supporting and their dependence on capital market for fund requirements have all changed the role of a finance manager. His role, especially, assumes significance in the present day context of liberalization, deregulation and globalization.

The chief financial officer of an organisation plays an important role in the company’s goals, policies, and financial success. 

His main responsibilities include:
(a) Financial analysis and planning: Determining the proper amount of funds to be employed in
      the firm.
(b) Investment decisions: Efficient allocation of funds to specific assets.
(c) Financial and capital structure decisions: Raising funds on favorable terms as possible, i.e. Determining the composition of Liabilities.
(d) Management of financial resources (such as working capital).
(e) Risk Management: Protecting assets.

Note: Chief Financial Officer (CFO) and Finance Manager are one and the same, and can be used inter-changeably.


If You Enjoyed This, Take 5 Seconds To Share It

0 comments:

Post a Comment