Question 1.3

DEFINITION:

The role of a financial manager is a complex one, requiring both an understanding of business activities and requires financial knowledge. The manger is responsible for financial projections of the company. The manager should have the ability to calculate the future returns and risk by using financial tools and even they should have the sound knowledge of accounting systems. The final goal of a financial manager is to maximize profits by applying financial tools and strategies .In order to achieve profits there are certain difficulties where as he has to respond quickly to the market reactions and he has to take quick decisions basing on the market conditions .

CONCLUSION:

The ultimate goal of a finance manager is maximizing profit which can be measured by increasing the wealth of the company and increasing the share value of the firm. However, there are two main problems commonly a finance manager can face mainly uncertainty of future returns and its timing. For example the shareholder might expect a return in a short period of time, but the finance manager may not able to achieve in a short period of time.

Question 3-11

DEFINITION: It is good for a company to go for an IPO to raise funds, whereas few disadvantages are there so most of the companies are not raising funds through IPO. One of the most important changes is the need for disclosure for investors. Public companies are regulated by the securities exchange act 1934 in regard to periodic financial reporting, which may be difficult for newer public companies. They must also meet other rules and regulations and some of the additional costs include the generation of financial reporting documents, audit fees, investor relation departments and accounting oversight committees

CONCLUSION:

They are hesitating to issue new shares to third party rather they want to