(Mberiah Only) FIN301: The Role of the Financial Manager

Module 1 - Home

The Role of the Financial Manager

Modular Learning Outcomes

Upon successful completion of this module, the student will be able to satisfy the following outcomes:

· Case

· Describe the role of the financial manager in the larger corporate structure.

· Explain how the financial manager leads in terms of capital financing.

· Discuss the important personal characteristics for a financial manager

· Discuss how the financial managers leads in terms of operational financing.

· SLP

· Describe the role of the financial manager in the larger corporate structure.

· Discuss the important personal characteristics for a financial manager.

· TD

· Describe the role of the financial manager in the larger corporate structure.

· Discuss the important personal characteristics for a financial manager.

What is a financial manager and how does s/he fit in to the overall corporate structure? We begin by assessing the role of the financial manger in the modern corporation.

Managers, in general, guide the organization. They make sure that things get done. Combining organizational resources - people, material, transportation, and the like - managers make sure that everything comes together in a way that meets the company's objectives.

Management has been defined as "the process by which a cooperative group directs the actions of others towards a common goal". Others see it in terms of organizational objectives, coordinating resources, planning, directing controlling, and managing people. Of course, they are all right. These are all essential elements to the role of management in the modern corporation.

A manager must have excellent interpersonal skills, be able to create and disseminate information, be a solid decision maker, and more. As if this skill list was not demanding enough, changes in the 21st century make the role of the manager even more challenging.

The role of the financial manager, in particular, has very specific demands. The financial manager sees everything and is involved, to some extent, in everything. We will be looking at the issue of, what I would call, epistemic privilege, in the modular case-based analysis.

The role of Financial manager moves in two different directions:

· Capital Financing

· Operational Financing

· The financial manager must be concerned with the monies necessary in order to get the operation up and running, and expanding. This is the matter of capital finance.

· On the other hand, the financial manager must also be concerned with financing ongoing activities. This we call operational finance.

· The former is discretionary. A company can move in different directions and move into new projects at its own discretion. However, operational finance is a must. Meeting payroll, paying taxes, servicing equipment, and so on, is a mandatory element of any business. The lack of this mandatory operational capital is the number one reason companies go bankrupt.

· Most people see the financial manager as simply a treasurer. However, the financial manager is an integral part of the overall management team. In some sense, s/he is the cynosure. In this module we will be assessing the role of the financial manager in the overall corporate structure.