Question

Financial management is essential for all types of organisations.

Answer 1

This statement is 'True' because of the following reasons :
(i) Financial management deals with procurement of funds and their effective utilisation i.e.,
(ii) There are two basic aspects of financial management.
(a) Raising of funds (b) effective utilisation of funds.
(iii) It deals with planning, organizing, directing, co-ordinating and controlling financial activities.
(iv) It is called the Resource management as the business activities involve use of finance.
(v) Also there are profit making organisations and non profit making organisations.
(vi) So the scarce resources of savings have to be used in developmental activities in all different type of organisations.
(vii) Thus the funds available should be used properly in business activities.
(viii) So financial management is essential for all types of organisations.