As the proverbial saying goes, it takes money to make money.

Finance is the lifeblood of the business; without it, things wouldn’t run smoothly. It is the source to run any organisation, and it provides and acquires the money.

The prudent management of the organisation’s finances is essential to the long-term growth and sustainability of the business. Most entrepreneurs are not experts in managing their finances, but they need to learn enough about finance functions to have the working knowledge required to run a business.

Financial Management is the business process that helps the organisation meet its goals by acquiring, managing, and planning the judicious expenditure of the funds. Besides compiling the company’s financial statements, the finance function’s primary responsibilities are to budget for capital requirements, select the appropriate capital structure, and manage cash flow.

Financial management affects your ability to employ and pay your staff, purchase raw materials, survive tough times, and flourish when the circumstances are right. It may not be as important as a great purpose, vision, or innovative product. Still, proper financial management makes the good stuff happen.