What is financial management?

Financial management is the planning, organizing, and directing of the economic activities of a company or organization. Financial decisions may include determining investments, creating budgets for different departments, and analyzing costs and profits of the company’s products or services to ensure maximum profitability, and meeting the company’s overall monetary goals and objectives. Higher-level executives typically handle financial management; they either oversee the finances themselves, or they may hire a third party to evaluate the financial condition of the organization and make suggestions to improve efficiency and cost-effectiveness.