Discuss the Objectives of Financial Planning .

1.	Discuss the Objectives of Financial Planning .
Answer» Like any other type of Planning , Financial Planning is also considered to be a purposeful activity . The Twin objectives of Financial Planning are : (i) To Ensure Availability of Funds , whenever these are required : Finance is a scare, but is an essential resource to carry out the activities of a business enterprise . Sound Financial Planning helps in timely and adequate availability of funds which is important for smooth running of a business enterprise . (ii) To See that the Firm Does Not Raise Resources Unnecessarily : Each source of finance has a cost attached to it . Therefore , excess funding is likely to have an adverse effect on the Cost Benefit Ratio . The idle funds do not create any benefits , unless Utilized in the best possible manner . Thus , effective financial planning helps to estimate and utilize funds appropriately .

Answer»

Like any other type of Planning , Financial Planning is also considered to be a purposeful activity .

The Twin objectives of Financial Planning are :

(i) To Ensure Availability of Funds , whenever these are required : Finance is a scare, but is an essential resource to carry out the activities of a business enterprise . Sound Financial Planning helps in timely and adequate availability of funds which is important for smooth running of a business enterprise .

(ii) To See that the Firm Does Not Raise Resources Unnecessarily : Each source of finance has a cost attached to it . Therefore , excess funding is likely to have an adverse effect on the Cost Benefit Ratio . The idle funds do not create any benefits , unless Utilized in the best possible manner . Thus , effective financial planning helps to estimate and utilize funds appropriately .

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