Chapter 1. The Role of Financial Management. © 2001 Prentice-Hall, Inc. Fundamentals of Financial Management, 11/e Created by: Gregory A. Kuhlemeyer, Ph.D. Carroll College, Waukesha, WI. The Role of Financial Management. What is Financial Management? The Goal of the Firm
The Role of Financial Management
© 2001 Prentice-Hall, Inc.
Fundamentals of Financial Management, 11/e
Created by: Gregory A. Kuhlemeyer, Ph.D.
Carroll College, Waukesha, WI
Concerns the acquisition, financing, and management of assets with some overall goalin mind.
Most important of the three decisions.
Determine how the assets (LHS of balance sheet) will be financed (RHS of balance sheet).
Maximization of Shareholder Wealth!
Value creation occurs when we maximize the share price for current shareholders.
There exists a SEPARATION between owners and managers.
Management acts as an agentfor the owners (shareholders) of the firm.
Board of Directors
(Chief Executive Officer)
VP of Finance
Preparing Fin Stmts
Change the decimal places displayed from “2” to “Floating”
Change the periods per year from “12” to “1”