Responsibilities of Financial Manager

A financial manager is a person who is responsible to carry out the financial functions. In these days, financial manager occupies a key position. He/she is one of the key members of top management team. The role of financial manager is widening day by day and cannot be confined within limited area. The financial manager now is responsible for shaping the fortunes of enterprise, and is involved in the most of vital decision of the allocation of capital. As a team members of top level management, financial managers are involved and interact with all the following organizational key decisions.

• Choice of products and market of the firm. 
• Strategies for research, investment, production, marketing and sales.
• Selection, training, organization and motivation of executive and other employees
• Obtaining funds at a low cost and efficiently
• Adjustment to the above as environments and competition change

Financial managers must interact with most of above mentioned decisions area. However the following areas are regarded as primarily financial functions and the responsibilities of financial manager in the firm.

•  Analysis of financial aspects of all decisions
• Investment decision to generate sales which the firm has planned to achieve
• Financing decisions to spend on different assets to produce products and services. This is also called capital structure decision.
• Analysis of individual income statement accounts: revenues and costs. A major responsibility of financial managers is to control cost. Therefore, the firm can price its products competitively and profitably.
• Analysis of operating cash flows of all types. This is a third major financial statement, statement of cash flows, and it can be derived from the balance sheets and income statement
• Dividend decisions
• Dealing with financial market and institutions
• Management of finance department.

The financial manager’s task is to make decisions concerning the acquisition and use of funds for the greatest benefit of the firm. Some specific responsibilities are as follows:

• Financial managers use forecasting and planning to shape the firm future position.
• Financial managers make major investment and financing decisions.
• Financial managers coordinate and control when interacting with other executives so that the firm operates as efficiently as possible.
• Financial managers must deal with the financial markets.  

In sum, the central responsibilities of the financial manager relates to decisions on investments and how they are financed. In the performance of these functions, the financial manager’s responsibilities have a direct bearing on the key decisions affecting the value of the firm.