Everything You Need to Know About Corporate Finance!

The article explains the entire process of Corporate finance and money management that's involved to get maximum profits for the organization. However, Corporate Finance is not just limited to these.
Corporate finance and money management

The dictionary definition of this term can be summed up as 'an area of finance that deals with the sources of funding and the capital structure of organizations, actions that managers take to increase company's value to the shareholders, as well as the tools used to allocate financial resources.'

However, Corporate Finance is not just limited to these. It is a much broader term that includes the following aspects -
  1. Planning - the first step of managing the monetary aspect for any corporation begins with the planning of the assets. This step includes what are the sources for money that the corporation can utilize, how much cash is required by the organization, and lastly when these funds are managed, how to make use of these resources in the best possible manner. With these steps the initial process of corporate finance begins.
  2. Raising - after the initial planning comes the most important step, i.e. raising the sum that can be used by the company. This step involves collecting money from various resources. Sources like shares, debentures, financial institutions, and creditors are the sources that are utilised by the managers of the organization for raising the sum of money to be used.
  3. Investing - once the capitals are gathered, the next step becomes utilizing that money to invest in assets. These assets can be fixed; in the form of offices, buildings, land and machinery, or they can be working capital which is used to purchase raw materials, and manage day-to-day expenses such as electricity bills, salaries of the employees as well as taxes.
  4. Monitoring - last step of this entire process involves controlling and managing of the funds. This would involve minimizing the wastage of resources, minimize the risks of investment, and at the same time make sure to get the best out of those investments be it through pre IPO deals or whatever the process that needs to be followed. This requires staying up-dated with the entire technical advances in the market and doing whatever it takes to get, axiom profits.
All these steps explain the entire process of corporate finance and what all a manager needs to do in order to get the best results for the organization that he/she's in charge of. Businesses are all about making money, and to make sure the monetary flow continues in the most effective manner, you need to have managers who can handle the corporate funding and all the processes involved in it.


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