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Finance & Accounting
Pages 4 (1004 words)
Introduction to Finance <Student Name> <Name and Section # of course> <Instructor Name> <Date> FINANCE AND FINANCIAL ENVIRONMENT The department of finance is considered as one of the vital department that is necessary for the organization to function in a smooth manner…
(Gitman, 2011) Finance is often defined as the art of managing financial resources, which includes activities such as arranging these resources in the least expensive manner and, investing any surplus resources in order to reap extra margins. (Gitman, 2012) Moreover, it also includes the understanding of the basic operations in order to ensure the best management of the funds that are available to the manager. Finance also helps in assessing the financial strength of the company through the use of ratio analysis that helps one understanding various aspects of the firm such as liquidity, efficiency, profitability and leverage, while the most important principle of finance is based upon discounting the value of financial resources such as money, bonds and expected cash-flows with respect to time. (Brigham, 1998) The collapse of Lehman Brothers on 15th September 2008 had devastating impact on the confidence of the general investor throughout the world that led many financial managers to question the rules and regulation that dictate the environment of the business (The Guardian, 2011) Financial crisis have hardly known to be isolated to themselves, in fact they spread like any contagious disease that often triggers the collapse throughout the world. ...
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