INTRODUCTION TO FINANCE at IOB

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INTRODUCTION TO FINANCE at IOB

What is FINANCE?

Finance is the study of money and assets. It is intertwined but not the same with economics, the study of production, distribution, and consumption of money, assets, goods and services.

Overview

The use of financing is vital in any economic system, as it allows companies to purchase products out of their immediate reach. Put differently, financing is a way to leverage the time value of money (TVM) to put future expected money flows to use for projects started today.

Frequently Asked Questions

What do you mean by finance?

Finance, of financing, is the process of raising funds or capital for any kind of expenditure. It is the process of channeling various funds in the form of credit, loans, or invested capital to those economic entities that most need them or can put them to the most productive use.

What is finance and examples?

Finance is defined as to provide money or credit for something. An example of finance is a bank loaning someone money to purchase a house.

What are the 3 types of finance?

The finance field includes three main subcategories: personal finance, corporate finance, and public (government) finance.

What is the study of finance?

Finance is the specialised study of how an individual or a company manages its funds. Often combined or overlapped with accounting/business, a finance degree gives you a broad understanding of the way that money influences people and places.

Why should I study finance?

In other words, finance helps us make better decisions with our money and accounting enables us to keep track of it. You use finance in innumerable everyday financial scenarios, such as: Making a budget for your groceries. Deciding how much of your paycheck you want to save and how much you want to invest or spend.

What is the role of finance

?Finance involves managing the firm’s money. The financial manager must decide how much money is needed and when, how best to use the available funds, and how to get the required financing. The financial manager’s responsibilities include financial planning, investing (spending money), and financing (raising money).

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What is difference between finance and accounting?

The difference between finance and accounting is that accounting focuses on the day-to-day flow of money in and out of a company or institution, whereas finance is a broader term for the management of assets and liabilities and the planning of future growth.

What are the 5 principles of finance?

The five principles are consistency, timeliness, justification, documentation, and certification.

What is capital or equity?

Equity represents the total amount of money a business owner or shareholder would receive if they liquidated all their assets and paid off the company’s debt. Capital refers only to a company’s financial assets that are available to spend.

Is finance a good career?

A career in finance is exciting and rewarding, and, usually, very lucrative. It attracts young people who are hugely ambitious but who also have a head for economics, accounting and the ability to quickly and intuitively grasp and process complex financial concepts and data. Finance is all about managing money.

Is finance a good degree?

Yes, a finance major is a good major for many undergraduate students. The Bureau of Labor Statistics is projecting 5% job growth in business and financial occupations over the next 10 years. Financial advisor, budget analyst, and investor relations associate are some common careers in the field.

Is a finance degree hard?

Finance is a moderately hard major. Finance is easier than STEM subjects but more difficult than liberal arts majors. Most students find a finance degree difficult because of the moderately complex mathematics involved, the interdisciplinary approach, and the unfamiliar concepts and vocabulary included in the major.

What is finance in a business?

Financing is the process of providing funds for business activities, making purchases, or investing. Financial institutions, such as banks, are in the business of providing capital to businesses, consumers, and investors to help them achieve their goals.

What are the 5 roles of accounting?

  • Accounts receivable.
  • Accounts payable.
  • Payroll.
  • Financial controls.
  • Financial reporting.

Who is financial manager?

Financial managers are responsible for the financial health of an organization. They create financial reports, direct investment activities, and develop plans for the long-term financial goals of their organization.

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