Financial Management: The Basic Knowledge of Financial Management for Student

By Bambang Hadi Prabowo

Financial Management is written in a concise and simple manner and is fundamental to the learning needs of students at university. This book is written in a basic manner but does not neglect the details of each topic and material which is expected to provide a comprehensive understanding for students and readers.
Financial Management in this book discusses 4 basic things in financial management including:
1. Finance Management with sub discussions:
- Understanding of Money
- Understanding of Finance Management
- Understanding Finance Manager
2. Financial Statements with sub discussion:
- Finance Performance
- Financial Ratio Analysis
- Transaction Analysis
3. Working Capital with sub discussions:
- Working Capital Concept
- Understanding Of Working Capital
- Capital Structure
4. Cash management
- Cash Management Aspects
The 4 things discussed in this book are 4 fundamental and very important things to understand in financial management. Because the 4 things are commonly used in financial management in the real world. It is hoped that after understanding the 4 main discussions, students or readers can practice the basics of financial management and have the enthusiasm and motivation to study financial management at an advanced level.

• Language: English
• Publisher: Triple Nine Communication
• Release date: Jun 11, 2022
• ISBN: 9791221352856

Book preview

Foreword

Financial Management is written in a concise and simple manner and is fundamental to the learning needs of students at university. This book is written in a basic manner but does not neglect the details of each topic and material which is expected to provide a comprehensive understanding for students and readers.

Financial Management in this book discusses 4 basic things in financial management including:

1. Finance Management with sub discussions:

- Understanding of Money

- Understanding of Finance Management

- Understanding Finance Manager

2. Financial Statements with sub discussion:

- Finance Performance

- Financial Ratio Analysis

- Transaction Analysis

3. Working Capital with sub discussions:

- Working Capital Concept

- Understanding Of Working Capital

- Capital Structure

4. Cash management

- Cash Management Aspects

The 4 things discussed in this book are 4 fundamental and very important things to understand in financial management. Because the 4 things are commonly used in financial management in the real world. It is hoped that after understanding the 4 main discussions, students or readers can practice the basics of financial management and have the enthusiasm and motivation to study financial management at an advanced level.

Best Regards

Dr Bambang Hadi Prabowo

Table Of Contents

OPENING SPEECH Chairman of the Maju Jaya Negara Tamansiswa Foundation 1

OPENING SPEECH Registrar General of the Supreme Council The Tamansiswa Union 2

Foreword 3

Chapter 1. Finance Management 1

1.2. Understanding of Money 8

1.3. Understanding of Finance Management 17

1.4. Understanding Finance Manager 25

Chapter 2. Financial Statements 34

2.1. Finance Performance 40

2.1.1. Financial Ratio Analysis 42

2.2. Transaction Analysis 46

Chapter 3. Working Capital 51

3.1. Working Capital Concept 55

3.2. Understanding Of Working Capital 56

3.3.Capital Structure 63

Chapter 4. Cash management 70

4.1. Cash Management Aspects 74

Chapter 1. Finance Management

Finance in a company is a strong foundation for building a company. Finance is also very risky. If it is not managed properly, it will become messy and will certainly stop a company from running. A company requires its own field that takes care of the financial department or it can also be called financial management. Financial management is the activity of planning, managing, storing and controlling funds and assets owned by a company. Financial management must be planned carefully so that problems do not arise in the future. Financial problems are a vital issue for everyone, especially for business people. Income and expenses must be clear because they determine the fate of you and the company going forward. The use of money arbitrarily will certainly have a bad impact. Therefore, to regulate the use of money, you need good financial management. Therefore, let us know more about the meaning of financial management (Menifield,2020). Finance is arguably an important aspect of life, so it needs to be managed through financial management. In general, experts agree that financial management is the art of managing existing resources to achieve certain goals. Whether you realize it or not, you actually have used financial management in your daily life. For example, to meet monthly needs. You usually calculate how much budget to spend, save, or invest during the year based on your income each month. It can also be another small thing, when you are on vacation in the city with a few dollars and arrange money so that you can survive to meet your needs during the holidays. It's all part of financial management. Talking about financial management, actually, cannot be separated from discussing management and money issues, because management means organizing and managing, whereas what is regulated is everything related to money that can be applied starting from the lives of individuals, households, groups, organizations, companies and countries. because life in each of these segments will always be associated with money to achieve its wants and goals.

1.1. Understanding Management and Money

Money can be said to be a medium of exchange that can be used as capital to obtain equipment and machinery for production as well as pay for labour costs. Money is the origin of the term finance. So it can be said that finance management is management to manage money or finances. Financial management is all company activities related to how the company obtains funds, uses funds and manages assets in accordance with company objectives. Every company definitely needs funds to meet its daily needs. The various company needs related to funding must be well managed and directed. That is why it is important for every company to have and pay attention to its financial management (Klimchuk et al,2020).

The purpose of financial management is to maximize the value of the company or provide added value to its assets. In general, financial management can be interpreted as regulating and administering all sources and uses of finance for the progress and goals of the company. Financial Management is all activities or activities of a company related to how to obtain working capital funding, use or allocate funds, and manage assets owned to achieve the main goals of the company. Before going any further into financial management, it is worth taking a brief look at management and money. Management is essential for an organized life and necessary for running all forms of organization.

Good management is the backbone of a successful organization. Managing life means getting things done to achieve life goals and managing an organization means getting things done with and through other people to achieve its goals. Management is the art of getting things done and with people in formally organized groups. It is the art of creating an environment where people can perform and are individual and can work together towards the achievement of group goals. Management which comes from the word to manage generally contains three definitions, namely:

a. Management as a process.

A fact that can be seen in everyday life whether individuals, groups or companies, to achieve a certain goal must go through a process in a certain time dimension as well. The notion of management as a process is defined as a process consisting of planning, organizing, mobilizing and controlling actions taken to determine and achieve predetermined goals through the use of human resources and other resources to achieve predetermined goals. The process itself is a systematic way of doing things. Management is a process because all managers regardless of their expertise and skills are always involved in interrelated activities in an effort to achieve organizational goals. The activities in question are planning, organizing, leadership and supervision. Management is a process by which the implementation of a specific goal is organized and supervised. The implementation of an activity to achieve a predetermined goal requires structuring, management and supervision so that the set objectives can achieve goals. Based on this understanding Management can be defined as the process of working with and through people and groups