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Functions of A Finance Manager

The Key Functions of a Finance Manager

Finance manager is one of the important role-players in the domain of finance function. He must have a complete know-how on the areas of accounting, finance, economics and management.

His position calls for judicious capability and analytical approach to solve various problems related to finance. A person who deals with finance related activities may be called finance manager.

“Focus on a few key objectives … I only have three things to do. I have to choose the right people, allocate the right number of dollars, and transmit ideas from one division to another with the speed of light. So I’m really in the business of being the gatekeeper and the transmitter of ideas.” – Jack Welch

Functions of a finance manager
The Finance Man

Finance manager performs the following major functions

Forecasting Financial Requirements

It is the principal function of the Finance Manager where he is required to estimate the financial obligations of the business concern. He should evaluate how much finances are required to procure fixed assets and forecast the amount needed to meet the working capital requirements in future.

Acquiring Necessary Capital

The next step of a finance manager is to focus on how the finance is deployed and where it will be available.

Investment Decision

Best investment alternatives have to be considered to assure reasonable and stable return from the investment. He must be competent in the field of capital budgeting techniques to govern the effective utilization of investment.

The finance manager must attach more importance to the principles of safety, liquidity and profitability while investing capital.

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Cash Management

Cash management plays a major role in the area of finance because proper cash management also helps to meet the short-term liquidity position of the concern.

Inter-relation With Other Departments

Finance manager handles various functional departments such as marketing, production, personnel, system, research, development, etc. He must maintain a good rapport with all the functional departments of the business organization.

“Rule No. 1 : Never lose money. Rule No. 2 : Never forget Rule No. 1.”
― Warren Buffett