Financial Manager - As a career option

Introduction

Financial management defines the standards and financial conditions of an individual or organisation. Our first introduction to Financial Management can be traced down memory lane where all of us can remember our parents budgeting out cash for vegetables, groceries, school fees, etc.

If you can understand what they were doing, then to comprehend the end objective of Financial Management is going to fairly easy.

From the professional perspective, Financial management refers to the efficient and effective management of money (funds) in such a manner as to accomplish the objectives of the organisation.

It is the specialized function directly associated with the top management. The term typically applies to an organisation or company's financial strategy. It includes how to raise the capital and how to allocate capital, i.e. capital budgeting.

Not only for long-term budgeting but also how to allocate the short term resources like current liabilities. It also deals with the dividend policies of the shareholders.

What is the role of a Financial Manager?

Simply put, financial management deals with the money management of a client. Individuals or firms that provide this service study with the needs and desired results of their clients and chalk out a strategy that shall bring propriety in terms of capital.

It is an evident understanding that before we can talk about savings and returns, we need to understand expenses and investments.

Therefore, financial management requires an overall analysis of one’s financial status and then produce a sensible scheme of setting that shall harbour better returns.

This is not an easy process as the usage and requirement of money is a highly unpredictable matter. But therein lies the true test and genius of a financial management firm/agent.

Through their rigorous brain work and study, they become capable of assessing the probable difficulties that might stand in the way or just pop up without a notice.

For ordinary people, situations like these may be exceptionally trying and difficult, but this is where financial management steps in to rescue those in distress and saves the day.

Referring to companies where there is a prevalent trend of shareholding and a considerable number of shareholders, wealth maximization means maximization of shareholders' wealth.

Survival of company is an important consideration when the financial manager makes any financial decisions. One incorrect decision may lead a company to bankruptcy. Maintaining proper cash flow is a short run objective of financial management.

It is necessary for operations to pay the day-to-day expenses e.g. raw material, electricity bills, wages, rent etc. A good cash flow ensures the survival of a company.

For new enterprises, it is important to make a good estimation of costs, sales. Consideration of appropriate length sources of finances can help businesses avoid the cash flow problems even the failure of setting up.

There are fixed and current sides of assets balance sheet. Fixed assets refer to assets that cannot be converted into cash easily, like plant, property, equipment etc. A current asset is an item on an entity's balance sheet that is either cash, a cash equivalent, or which can be converted into cash within one year.

How to become a Financial Manager?

Financial managers help public and private organisations develop and manage financial goals. Financial management is a broad term that encompasses many duties and job titles, including those of treasurers, risk managers and credit managers.

Many works full-time in an office setting. While the work hours can be long, the pay is well above the national average, according to the U.S. Bureau of Labor Statistics.

The minimum education requirement for financial managers is a Bachelor's degree in finance, business administration or accounting. Other educational majors may be acceptable if they involve finance, business or management.

In undergraduate finance programs, students can expect to learn about financial planning, securities and portfolio assessment. Accounting and business administration programs often cover similar topics, including finance principles and microeconomics.

Internship opportunities are a good way to acquire work experience. Students can get involved with local businesses and apply their classroom learning to real-life scenarios.

Because employers prefer employees with advanced educations, earning more than a graduate degree can improve job prospects and lead to career advancement. A master's degree in economics, business administration or finance is ideal.

Common courses in these programs include global financial markets, financial modelling, corporate financial management, financial theory and finance research.

Appropriate work experience and references are crucial for aspiring financial managers. Typically, these professionals begin their careers in related positions, such as accounting or financial analysis.

Financial managers are high-level personnel in most organisations and may be promoted from within. Any work experience related to finance or business management can be helpful.

A day in the life of a Financial Manager

Hello. I’m a Financial Manager and I work for a business organisation in Corporate Finance. I started out as a financial analyst for the same company and after a period of quality service, I’m now designated as a Financial Manager.

I head a team that includes analysts, cost accountants, etc. who work for me to give the company just the right kind of financial stability. Here’s a typical day in my life:

9:00 AM: Just got to work and the day looks pretty chalked out.

9:15 AM: I have a meeting with the board of directors at 11:00 AM to present a summarized report of the finances of the company for the last month.

I’m taking the help of the financial analyst and the cost accountant in preparing the report, where they will feed the exact numbers and I will put them in a displayable fashion.

10:00 AM: Another challenge for the day is to make an assessment for the upcoming month. The company has a few ventures that it is a party interested in. I have to see how feasible an investment will these be in all probability.

For this, I’m calling a finance department meeting and discussing pros and cons of the matter at hand. It’s always better to get more suggestions.

11:00 AM: The meeting of the board of directors has been postponed for post lunch. This will give me more time to prepare my report and also elucidate on the matter of investing in the new ventures by the company.

12:00 PM: I just got done preparing the financial reports for the previous month. Resuming the session with the finances team now.

1:20 PM: The stats so far tell us that our stockholders might not be too happy with the initial dip that the company will face, in all likelihood. However, the analysis shows a fair chance that we might soar by the second/third month. The decision is for the board to make.

1:45 PM: Lunch time.

2:00 PM: I’m going in for the meeting with the boards of directors now.

2:30 PM: I’ve presented a convincing previous month’s report and now sitting to discuss the shareholder’s angle regarding the new ventures.

4:00 PM: The meeting just got over. The board needs some time to think and it’s only logical. I’m going to check if the company has received any finance-related mails.

4:40 PM: Good day. Going home now.

Do you want to pursue your career as a Financial Manager? This is how a typical day in my life looks like. We hope this article has answered all your queries related to this profession. have your say in the comment box below. Enjoy reading!