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- The financial goal of any firm including public sector firms is to maximize the wealth of the shareholders by maximizing the value of the firm.
- The objective of financial manager is to increase or maximize the wealth of shareholders by increasing the value of the firm which is reflected in its earnings per share and market value of the firm.
- Function of finance manager includes mobilization of funds, deployment of funds, control over the use of funds, and balancing the trade-off between risk and return.
- The advantages of dole proprietorship are: (i) easy and inexpensive set-up, (ii) few governmental regulations and (iii) no firm tax. Partnership firm is a business owned by two or more persons. They are partners in business and they bear the risks and reap the rewards of the business. A partnership firm is governed by the Indian Partnership Act, 1932. Hence, it is relatively free from governmental regulations as compared to the joint stock companies. A group of persons working towards a common objective is a company. It represents different kinds of associations, be it business or non-business.
- Corporate investment and financing decisions are circumscribed by a government regulatory framework. The important elements of these framework are: (i) Industrial Policy, (ii) Industrial Licensing Provisions and Procedure, (iii) Regulation of Foreign Collaborations and Investment, (iv) Foreign Exchange Management Act, (v) Monopolies and Restrictive Trade Practice Act, (vi) Companies Act, and (vii) SEBI.