“To avoid the problem of shortage and surplus of funds, what is required in Financial management? Name the concept and explain four points of importance.

3 years ago
Financial Management

Financial Planning is required to avoid shortage or surplus of finance.

Importance of financial planning is:

  1. By planning utilization of finance, it reduces waste ,duplication of efforts and

         gaps in the planning.

     b. It helps in coordinating the various business activities such as sales, purchases, production, finance

     c. It is a technique of It helps in setting up standard and compare with the actual performance. The deviations, if any are then analysed. Causes found out and corrective measures are taken.

     d. It helps in avoiding shocks and surprises as proper provision regarding Shortage or surplus is made in       advance by anticipating future receipts and Payments.

 

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Sanisha Maharjan
Sanisha Maharjan
Jan 16, 2022
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