FINANCIAL MANAGEMENT AND CONTROL: A KEY TO MANAGEMENT EFFICIENCY
Financial planning and control when properly employed can assist management to achieve its objectives effectively. The objective of this study is to develop a realistic picture on how financial planning and control can help to make efficient and effective success in business organization which where properly addressed. The researcher make use of questionnaire, interview and chi square method. The researcher recommends that there should be coordination of functional management in planning and controlling the operations of the company. This will help to achieve maximum profitability and efficiency.
1.1Background to the Study
It is a fact that we are living in an era of planning and control, whether it is house wife with her household keeping allowances, or an industrialist with his responsibilities to the shareholders or even the government has to plan and control its operational activities in order to achieve their goals. Planning and control are part and parcel of our activities and it is an essential factor in business decision making.
In a competitive world where the key factors are cost, price, turnover and profit, planning and control enables every individual, firm and government to have a sound appreciation of the financial implication to his plan and action. Planning and control can be used by any type of organization that want to survive from a complete system covering decentralized department to organization with only a single procedure.
As a tool of management, it can increase the efficiency of the organization as a whole since all the departments are involved.
Besides no business prospers unless all its functions, accounting, finance, production, marketing personnel and so forth are fully staffed with competent individual. The efficiency and effectiveness of any organization therefore depends on a number of factors which may be categorized as clarity of purpose, management planning, control and communication. There is need to have a clear knowledge of the objectives of the organization otherwise it will not be possible to identify goals, set target for their achievement in form of planning, control and management of its finance (flow of funds).
According to Brigham & Campsey (1999), defines “financial management as the planning for acquiring and utilizing funds in a way that maximize the efficiency and value of the firm”. Most especially, finance is the evaluation and acquisition of production assets, procurement of funds and disbursement of funds. It involves four basic steps which are the functions, they includes:
– Raising of funds to finance project.
– Employment of these fund in valuable project.
– Management of the cash flow arising from these project.
– Returning of funds to their original sources
Financial manager’s duty is to employ the acquisition, location and management of these resources, finance therefore speeds into all segments of firms activities thus its function must be understood by all the managers in the firm. Having known the future financial needs of a firm; the question is how are these finance or funds be raised, this require knowledge of the financial market through the manager from which funds are drawn.