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What is financial management?

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Quick Answer

A business owner can use financial management to gauge how his business is doing financially and create a more successful company through the use of numbers. Financial management can also be used to inform a business owner of why his business is successful, unsuccessful or unchanging.

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Full Answer

Proper financial management allows business owners to take action on certain situations before they occur, rather than react to them after they take place. Careful financial management can also aid in securing a business loan by giving the lender a glimpse into the business' budget. Making important financial decisions, such as how much to invest in certain assets and how to approach employee benefits, can also become easier with proper financial management.

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