Accountability is a Legal and Moral Obligation
Accountability is a legal and moral obligation inherent in each individual, group or company in presenting an explanation regarding how financial management has been given by a third party.
Each party must provide an explanation of the utilization of resources and what has been agreed so that everything works with good transparency.
Transparency
Transparency is a principle of openness in presenting information about plans and all activities for those who have an interest, including financial statements that are reasonable, complete, accurate, timely, that can be easily accessed.
Viability
Viability is a principle that emphasizes the safeguarding of a company's finances in terms of operational expenses which must be adjusted to the available finances.
Integrity
The principle of integrity has the intention that each individual must have a level of integrity that is qualified in an effort to carry out operational activities.
Accounting Standards
Accounting standards are accounting system principles that emphasize the standardization of principles and accounting standards that have been applied with the aim of understanding financial statements so that they are easy to understand.
Main Duties of Financial Management
The main tasks of financial management include decisions about investment, financing business activities and dividend distribution of a company, thus the task of financial managers is to plan to maximize the value of the company.
Other important activities that must be carried out by financial managers involve four aspects, namely:
First, namely in planning and forecasting, where financial managers must cooperate with other managers who are responsible for the general planning of the company.
Second, financial managers must focus on various investment and financing decisions, as well as all matters related to them.
Third, financial managers must cooperate with other managers in the company so that the company can operate as efficiently as possible.
Fourth, regarding the use of financial markets and capital markets, financial managers connect companies with financial markets, where funds can be obtained and company securities can be traded.
From these four aspects it can be concluded that the main task of financial managers is related to investment and financing decisions.
Financial Management Activities
Financial management is related to 3 activities, namely:
Funds use activities, namely activities to invest funds in various assets. Fund allocation in the form of:
Financial assets (financial assets), namely a piece of valuable paper that has market value because it has the right to obtain income, for example: shares, certificates of deposit, or bonds.
Real assets (real assets) that is real assets: land, buildings, equipment.
Funding activities, namely activities to obtain sources of funds, both from internal funding sources and external sources of company funds.
Asset management activities, that is, after funds have been obtained and allocated in the form of assets, funds must be managed as efficiently as possible.