What is a good financial management ?

What is a good financial management ?

1. public sector

   • - Is more difficult and complex.
   • - Is based on the political reality.
   • - Is related with legal issues.
   • - It's objectives depends on the guidelines of the dynamics of the private sector.
   • Government Drawbacks
     • - The sources of resources have benn exhausted.
     • - Almost all nation are poor in terms of cash.
     • - Without cash, the budgets cannot be executed.
     • - The existence of external economic influences.
     • - THe insatiable demand of public services.
     • How we can solved it ?
       • establishing effective management systems that are appropriate or acceptable to solve the financial drawbacks of the different governments. "implement a coordinated financial management system."

2. private sector

   • - Wants to provide prudential and intelligent judgments about the information to the decisions makers.
   • - Is less difficult than the public sector.

3. Characteristics of the financial management in both sectors:

   • - Manage the cash flow to finance activities and operations.
   • - Safeguarding resources.
   • - Provide a financial structure for the planning
   • - Manage transaction processing systems for the control of operations and activities.
   • - Ensure the legality and regularity use of public funds.
   • - It focuses on to the concepts of efficiency and effectiveness.
   • - Report and interpret the results of the activities and operations.

4. Importance of Financial Management

   • "the financial administration is a discipline that helps us to plan, producing, controlling and directing our economic life"
     • Financial management in our daily life:
       • Is the personal manage of our resources, based on the necesities and desires
     • Financial management in the business:
       • Budgets: Is the estimated cost of a work or service.
       • Analysis of financial opportunities: It makes our savings becomes an efficient investment.
       • Money Management: records and posts our income and expenditure.
       • Investments and assets: Asset investment according to its functionality for the company.
       • Payment of taxes: take an advantage of the deductibility of costs, which happens in our productive activities.
       • Acquisition of funds: Perform a good planning of the necessary funds
       • Maximize utilities:Through operations (marketing and / or production), you can increase financial resources.

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