Busfin Lesson 1

BUSINES
S
FINANCE
Here starts
the lesson!
What is
Finance?
Do You have any idea
of the word finance?
Or what comes into
your mind when you
hear the word
LESSON 1 Objectives:
1. Define Finance
Table of
Contents! 2. Describe who are
responsible for financial
management within an
Overview organization
3. Describe the primary

The definition of
activities of the financial
Finance, the activities manager
of Financial Manager,
4. Describe how the
and financial
financial manager helps in
institutions and achieving the goal of the
01
LESSON 1
Introduction to
Financial
Management
Introducti
on
● Finance can be defined as
the science and art of
managing money. (Gitman
& Zutter, 2012)
● Finance - is the study of
how individuals,
institutions, governments
and businesses acquire,
spend and manage money
and other financial assets.
(Cristobal M. Pagoso,
Money, Credit and
Why is it important to study
Finance?
a.To make informed economic and

financial decisions. (Thus, an
individual can became
economically and financially
literate)
b. To acquire basic knowledge of
investments for business and
personal relations.
“Finance Vs Economics and
Accounting ”
Economics deal with production, distribution

and consumptions of goods and services.
Accounting deal with the quantitative
information needed by the users of
information. For an overall view, People
working
—Brighamin &finance department
Houston, Fundamentals of should have
Financial Management
knowledge Thirteenth
of economics and accounting
Edition
BRANCHES
OF
FINANCE
● CORPORATE
FINANCE
● PUBLIC FINANCE
● PERSONAL
FINANCE
● primarily concerned
with the
CORPORAT management of all
E FINANCE the financial
activities of an
enterprise or a
business
organization.
● Example: bank loan,

IPO ( Initial Public
Offering), dividend
distribution,
refinancing
● deals with collection
of taxes, budget
allocation for
PUBLIC programs which are
FINANCE designed to benefit
the general public
(Taxpayers) and the
production and
distribution of public
goods.
● Example: Tax
collection, National
debt, National
budget, Expenditure
● encompasses everything
that pertains to personal
PERSONAL financial planning,
FINANCE including coming up with
a budget that matches
one’s short term and long
term needs, creating
savings plan for
contingencies, investing
in financial products and
investing for the purpose
of maximizing wealth.
● Example: personal
budgeting
Areas of
Exam
FINANCE conte
nt
FINANCIAL
INSTITUTION AND Financial Financial
MARKET Institution
and
Managemen
t
Market
FINANCIAL
MANAGEMENT
Investment
s
INVESTMENT
Financial
Manageme How much and what
nt types of assets to
acquire
How to raise the

Also Know capital needed to
n
as Corpo
ra t e purchase assets
Finance
How to run the firm

so as to maximize
its value
Financial
Institution Buying and
and Markets selling of
securities
( bonds and
stocks)
Like occurs
stock market,
-refers to
a
bond market,
market p forex market
lace
Philippine Stock
Exchage, New York
Stock Exchange,
Coins.ph
Investmen
ts
Is the act of
allocating
resources
usually money
with the
expectation of
generating an
income or profit
02
LESSON 2
Flow of Funds within an
Organization through and from
Enterprise and the role of the
Financial Manager
Flow of
Funds
Indirect direct
-Borrowers and -In which lenders

lenders never meet and borrowers
Flow of funds Flow of funds
from Financial from
Flow of funds
from Financial
directly, Funds are meet directly to
Institution lender/savers market transferred through exchange
financial securities.
intermediaries.
Philippin
e Stock
Exchang
e
Roles of a Financial
Manager – is a person
FINANCIAL
MANAGER involved in
various financial
activities such as
financial
planning,
budgeting,
forecasting, and
preparing reports
that contribute to
the setting of
goals and
objectives.
ROLES OF A FINANCIAL
MANAGER Review company
financial reports
Monitor financial and seek ways to
details to ensure reduce costs
that legal
requirements are
1 2,
met
3 4
Prepare financial Supervise

statements, employees who do
business activity financial
reports, and reporting and
forecasts budgeting
ROLES OF A FINANCIAL
MANAGER Help management
make financial
decisions
5
6
Analyze market trends to
find opportunities for
expansion or for
acquiring other
companies
Equity Debt
Financing Financing
- Raise in Capital through - If the raise
issuance of share ( for comes from a
Corporation) or Owners’ bank loan or
own pocket money (sole borrowings.
proprietorship
Investme
nt
Short Long term
term Investmen
Investmen t
t
The term Example: - Example:
of Investmen
investmen t held for
t is one more than
year or a year.
Assignment
ge 9 and
a
See P 0
1
ur
Of yo s.
out
Hand
Thanks
!
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BUSINES

3. Describe the primary

a.To make informed economic and

Economics deal with production, distribution

● Example: bank loan,

How to raise the

How to run the firm

-Borrowers and -In which lenders

Prepare financial Supervise

The term Example: - Example:

Did you like the resources on this

PHOTOS: ● Side view woman working on lap

● Wooden background with checkli

#a8d68c #f1c232 #b44141 #df7070 #7a9e64 #595959

Pana Amico Bro Rafiki Cuate

JANUARY FEBRUARY MARCH APRIL

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