Financial Manager - Finance - Lecture Slides, Slides of Finance

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What Does a Financial Manager Do?

Foundational Concepts

Where are Financial Managers Found?

• Government of Canada
  • Minister of Finance – Jim Flaherty
• Province of Ontario
  • Dwight Duncan, Minister of Finance
• Province of British Columbia
  • Carole Taylor, Former Minister of Finance

Outline Online Assignments^ Financial Mgrs. Ch. 1 - Finance

Where are Financial Managers Found?

Large Public Financial Institutions

Karen Gavan CA, former CFO and CEO

Transamerica Life Canada

Outline Online Assignments^ Financial Mgrs. Ch. 1 - Finance

Honours Bachelor of Commerce – Lakehead University

Where are Financial Managers Found?

Smaller Corporations

Colin Paddington CFA, MBA, Chief Financial Officer

Care Factor: The Data Center Company, Calgary, AB

Outline Online Assignments^ Financial Mgrs. Ch. 1 - Finance

Honours Bachelor of Commerce, Finance – Lakehead

University 1999

Where are Financial Managers Found?

• Small Businesses
• Non-profit organizations
  • Foundations
  • Symphony Orchestras
  • Theatre Companies
  • Churches
  • Other NGOs
• Households

All governments, businesses, organizations and households

must deal with financial issues!

Outline Online Assignments^ Financial Mgrs. Ch. 1 - Finance

Financial Manager Titles

• Director of Finance and Administration
• Secretary Treasurer
• Chief Financial Officer (CFO)

Outline Online Assignments^ Financial Mgrs. Ch. 1 - Finance

Foundational Concepts

What Does a Financial Manager Do?

 Raise capital to finance operations:

 Negotiate bank financing (loans, leases, lines of credit,

letters of credit)

 Raise capital in the markets:

 Sell commercial paper to investors in the money market  Sell bonds to investors in the bond market, or negotiate private placements  Sell new equity to investors in the stock market

 Decide to retain operating earnings to grow the business

 Sell assets to generate cash

 Invest surplus funds to generate investment income

Outline Online Assignments^ Financial Mgrs. Ch. 1 - Finance

Foundational Concepts

What Does a Financial Manager Do?

 Manage cash flow

 Forecast cash inflows and outflows in order to predict daily

cash balances (cash budgets)

 Set and evaluate policies credit policies (extended to

customers)

 Ensure fixed contractual obligations are honoured.

Outline Online Assignments^ Financial Mgrs. Ch. 1 - Finance

Foundational Concepts

What Does a Financial Manager Do?

 Monitor & Evaluate corporate performance

 Critically evaluate business alternatives

 Recommend corporate divestitures/acquisitions

 Evaluate expansion proposals

Outline Online Assignments^ Financial Mgrs. Ch. 1 - Finance

Foundational Concepts

Controllable and Non-controllable Issues for the Financial Manager

Uncontrollable

• Tax policy
• Monetary & Fiscal Policy of the

Government

• Interest rates
• Market prices for stock and

bonds

• Exchange rates
• Inflation
• Actions of competitors

Things Influenced

 Financial policies &

practices

 Investment/divestment

decisions

 Amount of debt undertaken

 Rate of growth of the firm

 Risk undertaken by the firm

These are just some simple examples. The point, however,

is that while the financial manager may not control some

things…she must still understand those uncontrollable

variables and manage in the context of them.

Outline Online Assignments^ Financial Mgrs. Ch. 1 - Finance

Foundational Concepts

What Skills Does a Financial Manager Need to Possess?

 The financial manager will need the following skills:

 Soft skills:

 Listening  Negotiation  Communication (oral and written)

 Hard skills:

 Financial analysis  Budgeting & variance analysis  Statistical and mathematical skills  Spreadsheet modeling

Outline Online Assignments^ Financial Mgrs. Ch. 1 - Finance

Other Financial Titles

• Vice President Risk Management
• Financial Analyst
• Portfolio Manager
• Chief Investment Officer
• Investment Advisor
• Investment Manager
• Financial Advisor