Finance Terms - Explained

Finance is a well known term in our daily life, in both personal and professional fields. Finance means the proper and systematic planning of an individual or an organization for the use of monetary resource over time.

Finance has many other definitions like:-

a) It is a study of money.

b) Management and control on different assets, risks.

In business fields “to Finance” means to provide fund for the business whether it’s small or big. Many big industries are there which runs on the fund. This concept of fund is also applicable in our personal life like, if any common person wants to purchase some thing large for example car, home etc.

Basically, Finance is the set of techniques which make an individual or an organization more focused on managing money or rather make them particular to differentiate their income and expenditure. With the help of proper Finance both individual and organization can get rid of the risk on investment to some extent.

Finance has different categories like finance used by an individual is private finance, finance used by government is public finance, by business man is corporate finance, and Finance is also used by different organization like schools, colleges, clubs and many other non-profit organizations. This is because each and everybody wants to achieve their ultimate goal in a properly planned way so that at the end it becomes easier to calculate their income and expenditure, relating to which both the profit and non-profit organizations as well as individuals can plan their future finance. Finance also helps to rectify any mistake done in previous planning.

Finance helps in better institutional settings.

Finance is the most important back bone of any business management, proper financial planning brings success to an organization no matter whether the company is very much new or old.

While for individuals, finance makes man perfect in estimating his future income, expenditure and assets. It even helps in controlling the expenses.