The financial management industry has changed over the years as technology and systems to increase efficiency have advanced.
This means students need to be equipped with the latest knowledge of the financial field to be recognised by employers and have successful careers as financial managers.
REGENT offers an advanced Diploma in Financial Management that equips students with the skills and knowledge to manage company finances, assist decision-making, and help companies increase profitability.
This article discusses financial management, its functions, and trends so you can better understand what is expected of financial managers in today’s workforce and what you can do to prepare for a successful career.
What is financial management?
Financial management involves effectively managing and allocating a company’s financial resources to help it achieve objectives. Regardless of size, all businesses must manage their finances to ensure they know exactly what they’re spending and bringing in.
Finance management encompasses various activities, including:
- Financial planning
- Budgeting
- Accounting
- Reporting
- and more
The primary goal of finance management is to minimise risk and maximise company profits by ensuring that monetary resources are used effectively. This involves helping shareholders make economic decisions based on accurate financial information.
What are the five functions of financial management?
Finance management comprises five core functions to help companies increase their chances of success.
1. Financial planning and forecasting
Financial planning and forecasting create a realistic and achievable financial plan based on data, trends, and future expectations. It includes:
- Assessing a company’s current financial position
- Understanding a company’s income and expenses
- Coming up with a strategy to achieve long and short-term financial goals
Having a plan and relying on forecasting can help companies make better decisions and avoid any potential challenges.
2. Cash management
Cash management involves overseeing a company’s incoming and outgoing cash flow to ensure optimal liquidity and maximise the strategic use of cash.
It helps maintain the financial stability of a company so they can utilise their financial resources in a more innovative way that works towards the business’s goals.
Cash management consists of many vital components, including:
- Cash flow monitoring
- Cash flow forecasting
- Liquidity management
- Working capital management
- Investing surplus cash
- Managing debts and finances
- Cash concentration and distribution strategies
3. Financial reporting
Financial reporting is creating and presenting statements to provide companies with insights into their financial performance and position.
The main goal of reporting is to provide stakeholders with accurate and timely information to help them make better decisions regarding investments, management, employees, and more.
Managers need to examine various financial statements, including income statements, balance sheets, and statements of changes in equity, for effective analysis.
4. Financial control
Financial control involves ensuring financial activities are accurate and comply with the regulations and laws. The goal is to protect a company’s assets and maintain the integrity of economic data.
Some critical areas of financial control include:
- Budgeting and variance analysis
- Expense management
- Revenue collection
- Compliance with financial reporting laws
- Internal controls
5. Risk management
Risk management identifies, assesses, and manages risks that could hurt a company’s finances. It involves developing risk mitigation strategies and ensuring companies are prepared for unforeseen events.
Effective risk management can help companies minimise their losses and give them the confidence to proceed with operations and achieve their goals.
What is the emerging role of a finance manager?
As businesses continue to evolve, so does the role of finance managers. Today, these managers are not only responsible for managing finances, but they also play a vital role in decision-making.
They are expected to provide valuable insights and recommendations to help companies achieve optimal financial output.
As technology advances, managers are also expected to incorporate technologies into their financial processes to use data analytics and systems to their advantage.
They can use technology to gather essential information, lower the risk of human error, and finish financial projects faster.
A finance management diploma can prepare you for these trends by providing a solid financial foundation and exposing you to different technologies and sustainable systems.
Some of the skills that you’ll learn with a diploma in financial management include:
- Financial analysis and reporting
- Business management
- Budgeting and forecasting
- Risk management
- Investment management
- Strategic planning
- Communication
- Interpersonal skills
- Technology skills
- Financial accounting
- Ethics and corporate governance
Other benefits financial management courses offer include:
- There are vast career opportunities within the financial sector, including, but not limited to, Financial Manager, Financial Analyst, Data Analyst, Accountant, and more.
- A competitive salary, with many financial managers earning over R50,000 in April 2024.
- The opportunity for career growth is available as you can take on more senior roles.
Look at REGENT’s Diploma in Financial Management to learn more about what you can expect with this qualification.
FAQ
How does a diploma in financial management differ from other finance-related qualifications?
A diploma in finance focuses on practical skills and knowledge for managing a company’s financial resources and includes aspects such as budgeting, economic analysis, investment management, and cash management.
Other finance-related courses, such as accounting and economics, focus more on theoretical and specialised areas of finance, such as banking and auditing.
What are the benefits of studying for a financial management diploma through REGENT?
REGENT is a reputable institution accredited by various professional bodies, ensuring employers recognise and value your qualifications.
The diploma programme is designed to equip you with practical skills and knowledge, allowing you to apply what you learn in real-world scenarios.
Additionally, REGENT offers flexible study options, allowing students to balance their studies with other responsibilities.
Study for a Financial Management Diploma with Regent
Now that you have a better idea of what is expected of financial managers in today’s workforce consider whether this career path is right for you.
If all of this sounds exciting and you want to take your first step into becoming a finance manager, look at REGENT’s Diploma in Financial Management. You can also consider our Bachelor of Commerce in Accounting if you want to go into a more specialised field.
