Paper 8 – Financial and Strategic Management including MCQ (CS Executive Module II Old Syllabus) by CA Raj K Agrawal & CA Shilpum Khanna

Frequently Asked Questions (FAQs):

Q. What is the difference between strategic management and financial management?

A. Strategic management and financial management are two important aspects of business, but they have distinct roles and functions. Strategic management is the process of developing and implementing plans to achieve an organization’s long-term goals. It involves setting goals, analyzing the competitive environment, making strategic decisions, and allocating resources. So, strategic managers need to have a strong understanding of the business environment, strengths-weaknesses, and needs of customers. While, Financial management is the process of planning, controlling, and coordinating financial activities to achieve the organization’s goals. It involves budgeting, forecasting, investing, and managing debt. Financial managers need to have a strong understanding of accounting principles, financial markets, and risk management.

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Q. What is an example of financial management?

A. Here is an example of financial management:

A company is planning to expand its operations and must assess the amount of funding required to support the expansion. The financial manager will assess the company’s financial position and identify potential sources of funding, such as loans, equity investments, or retained earnings. The financial manager will then develop a budget that outlines the costs associated with the expansion, such as new equipment, employee salaries, and marketing expenses. Next, the financial manager will evaluate different financing options, assessing their risks and rewards, and will determine the best fit for the company.

Throughout the expansion process, he will track the company’s financial performance and make adjustments to the budget as needed. The financial manager will also work with other departments to ensure that the company has the resources it needs to achieve its goals.

This is just one example of financial management. Financial managers engage in a broad spectrum of activities, ranging from preparing budgets and financial statements to analyzing financial data and offering financial advice. Financial management is a critical function in any organization, and it plays a vital role in the success of businesses of all sizes. So, to learn it, join this CS Executive FSM Classes.