Management of finance is the mother of all business activities and decisions are made on the economic status of an organization or venture. The financial manager is, therefore, key to the success of any given business. They are responsible for offering financial guidance and assistance to customers so that they can make extensive business choices. Financial managers must be proactive since they deal with the sophisticated analysis and modeling in the financial systems, (Schultes, 2011). Examples financial managers include finance officers and treasurers, creditors cash managers, insurance managers, controllers and risk managers. They work in various sectors ranging from private to public sector organizations.
Preparation of budgetary plan is done by the financial managers who are crucial for the companies in making both short-term and long-term decisions hence helps the company to know the economic consequence of any business before it is undertaken, (Marriage, Ram & Williams, 2017).
Credentials for financial manager.
A bachelor’s degree in finance, economics, accounting and or business administration are the minimum requirements. However, some individuals seek to go for master’s degree to improve in these areas of profession. Financial managers are charged with several duties within an organization depending on the sizes. In big companies, for example, they are concerned with the strategic analysis, while in smaller companies, they may be responsible for the preparation and collection of accounts.
Duties bestowed on them include the formulation of long-term business plans and strategies, monitoring and interpretation of the programs and the cash flows, analysis of market trends and nature of competition, (Flood, 2017). Also provision and interpretation of financial information, management of organization’s financial accounts and arranging of new sources of finance for organization’s debt facilities and so on.
A typical example of a case study is a case between a Mary Chemweno, the plaintiff versus Kenya Pipeline Company Limited (KPCL), the defendant. The plaintiff claimed unfair termination of her employment by the respondent, Kenya Pipeline Limited. This was after the respondent admitted that they were the sole employers of the claimant and the contract was terminated after probation by the Kenya Anti-Corruption Commission (KACC). The commission found out that she had abused her office and engaged in activities which were harmful to the respondent’s interests. The court, therefore, determined the reasons for contract termination that the employer at the time of completion of contract genuinely believed to exist and which caused the respondent to retrench of the employee.
It was found that the determined that the plaintiff was entitled to her allowances together with other dues and the court ordered for the following: that the plaintiff is hereby reinstated to her position with the respondent, with all her back salary, allowances, benefits and any other legal dues within thirty (30) days as well as all her unpaid allowances during the entire suspension period.
The short-term impact of this problem to the profession include; a poor delivery of services due to time spend out of the company, possible mess during resumption as activities cannot remain the same way they left them, the compensation is also an impact to the claimant. A company may also go bankrupt due compensation charges ordered by the court. The long-term consequences include loss of a job in case the defendant wins the case, the possibility of not being employed by another firm if found guilty. A company may risk losing all employees due to fear of such cases, the long-term goals and objectives of the company may not be achieved as well.
In conclusion, financial management is an essential profession in any business venture. Close focus is always put to ensure success. The primary role of a financial manager is to provide financial guidance and provide comprehensive business choices that are viable and profit generators. However, a slight mess can lead to one’s termination of the contract as seen by the case study or payment of huge charges that would make one miserable. Financial managers should, therefore, stay abreast of such faulty mistakes.
Schultes, A. K. (2011). The relationship between investment performance and organizational
ownership structure in U.S. small cap value equity managers (Order No. 3439091). Available from ABI/INFORM Collection. (849747763). Retrieved from https://search.proquest.com/docview/849747763?accountid=45049
Marriage, M., Ram, A., & Williams, A. (2017). Fund manager performance fees
Under attack. FT.Com, Retrieved from https://search.proquest.com/docview/1926823984?accountid=45049
Flood, C. (2017). Global fund houses hold crunch talks with FCA to clarify
mifid.FT.Com, Retrieved from https://search.proquest.com/docview/1955238908?accountid=45049