How Can You Compare Financial Management from Corporate Finance?
Corporate Finance and Financial Management are the two different functions of Finance, which though sound similar but have significant differences in their functionality in terms of the financial planning of a company’s operations. Both functions have several areas of responsibility in the corporate environment. Corporate Finance deals with a broader view of financial planning, whereas financial management is only concerned with controlling an organization’s financial activities. The academic writers of BookMyEssay assist the students in Corporate Finance assignment help with their accurate knowledge of Corporate Finance.
What is Corporate Finance?
The term corporate finance usually focuses on the long term plans for a business along with the overall picture of the financial structure. The areas of corporate finance responsibilities are the capital structure, financing, dividends, investment decisions, and return of capital. Corporate Finance is responsible for the budgeting and analysis of capital projects. It is responsible for deciding which projects are financed, approved, the interest rates, and the schedule of loan payment. Corporate Finance is also responsible for finding the source of capital as additional equity contributions or as debt. A company can raise its equity by selling adequate stock shares, borrowing from the commercial banks, and even issuing debt securities in the capital markets.
What is Financial Management?
The task of financial management involves organizing, planning, and controlling the financial activities of an organization. Therefore for overseeing the resources of a business efficiently, it applies the general management principles. The main objective of financial management is to create a reporting system and maintain a system of controls that would compare the actual results of the business to the budgeted expectations for a particular business project.
Further, it would also note down any discrepancies that might require specific management actions for resolving the issues. The contents of Corporate Finance assignment help provide immense knowledge to the students regarding Corporate Finance.
The overall process of financial management uses key performance indicators and ratio analysis to identify the non-performing areas and, thus, according to taking some corrective actions. The company’s financial management also controls the cash flow of a company to ensure that adequate funds are available to pay to the suppliers, pay wages, creditors, and even the utility bills for the company. While writing challenging assignments, the students might often wonder that “If I could ask academic writer to write my assignment uniquely?”
Comparison Between Financial Management and Corporate Finance
There are several comparable facts between the corporate finance and financial management of an organization. These differences determine its purpose, objective, and functions. These are discussed below:
- Corporate Finance is responsible for deciding the capital structure, taking investment decisions, dividends, and return of capital. In contrast, financial management controls a company’s cash flow and maintains adequate working capital.
- For investment decisions, corporate Finance uses various methods such as the Net Present Value or the Internal Rate of Return for evaluating the viability of long term capital investments. On the other hand, financial management is responsible for monitoring the accounts receivable collections and maintaining optimum inventory turnover.
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