Useful Need for Financial Planning Homework Help for Students
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Financial Planning and the Need for Financial Planning
With respect to Financial Management, Financial Planning is the process of determining the capital required to meet the company’s goals and objectives. As soon as the strategic goals and objectives are determined, the Financial Planning begins. It is the method of deciding financial policies with regard to investments, procurements and management of the funds of the company.
Financial Planning involves framing the policies, objectives and the budget of financial activities of the firm. It ensures efficient financial and investment policies. The needs for Financial Planning can be cited as:
- Adequate funds can be made available.
- Financial planning helps to ensure stability by striking a reasonable balance between the inflow and outflow of funds.
- It enables the company to face change in market trends by making sufficient funds available, and thereby, reducing uncertainties.
- A company with a Financial Planning easily interests the suppliers of funds to invest.
- It allows the company to make growth and expansion programs, helping it to survive in the long-run.
- Financial Planning helps to reduce uncertainties that can be a distortion in the path of growth and development of the company, hence ensuring stability and profitability.
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