Financial Management relates to the efficient and effective management of funds , Used in business in terms of its Planning , Obtaining , Controlling and Administration . Financial Management is concerned with optional procurement as well as usage of finance .

 It basically involves Two Aspects . 

(i) Optimal Procurement of Funds . 

(ii) Optimal Utilization of Funds . 

Thus Financial Management is deemed to be a barometer of financial health of an enterprise which is reflected through various financial statements such as Balance Sheet and Profit and Loss Statements . 

Objectives of Financial Management : 

• The prime objective of Financial Management is to maximize shareholder’s wealth by maximizing the market price of a company’s share . All the financial activities within an organization are focused at realizing the objective of wealth maximization . This can be achieved by ensuring that all the financial decisions are cost effective.
• Besides the objective of wealth maximization , sound financial management also seeks to attain the following objectives : 

1. To acquire adequate funds for the organization in time , In order to ensure smooth operations of the business . 
2. To ensure effective utilization of funds so as to curb wastage or embezzlement of funds . 
3. To ensure safety of funds by minimizing risks . 

• Profit Maximization as an Objective of Financial Management : More , we cannot consider profit maximization to be the prime objective of Financial Management , as it merely focuses on maximizing dividend per share .