Business Finance Overview

A comprehensive set of vocabulary flashcards covering the basics of business finance, corporate organizational roles, financial institutions, and key financial management concepts.

Business Finance

The science of managing money involving the efficient and effective allocation, acquisition, and utilization of funds.

Financing Decisions

The function of a financial manager that determines where the company will get funds, such as from owner's investment, bank loans, bonds, or issuing shares.

Investing Decisions

Decisions regarding where company funds will be invested, involving the purchase of long-term assets like land and machinery using Capital Budgeting Analysis.

Operating Decisions

Decisions dealing with daily business operations and the management of working capital, including cash, accounts receivable, and inventory.

Dividend Policy

The decision on how much profit will be distributed to shareholders versus how much will be retained for business growth.

Board of Directors (BOD)

The highest policy-making body that represents shareholders and ensures the company serves the interests of its stakeholders.

President

The individual responsible for overseeing daily business operations, implementing policies, and supervising Vice Presidents.

VP for Marketing

Responsible for formulating marketing strategies, directing sales, and conducting market and competitor analysis.

VP for Operations

Ensures production meets customer demand, identifies suppliers, and maintains product quality.

VP for Administration

Responsible for recruiting and hiring employees, overseeing Human Resources, and managing office operations and company records.

Treasurer

A role under the VP for Finance responsible for cash management, investor relations, credit and collection, investments, insurance, and borrowing funds.

Controller

A role under the VP for Finance responsible for financial reporting, accounting records, internal controls, and budget preparation.

Banks

Financial institutions that accept deposits, provide loans, and offer savings accounts to help manage money.

Stock Exchange

A marketplace for buying and selling ordinary and preference shares.

Stock Brokerage Firms

Firms that assist investors in buying and selling stocks and execute stock market transactions.

Insurance Companies

Entities that provide protection against financial risks by offering insurance policies.

Investment Companies / Mutual Funds

Entities that pool money from various investors to be managed by professional fund managers and invested in different financial instruments.

Working Capital

The funds used in the daily operations of the business, which includes current assets and current liabilities.

Capital Budgeting

The process of evaluating long-term investment projects to determine if an investment is profitable.

Capital Structure

The combination of debt and equity used to finance company assets.