PRIVATE FINANCE

Is the management of financial resources of private individuals, non-government organizations, and

private organizations in accordance with the prescribed financial policy and priority of the or business
organizations.

PUBLIC FINANCE

Is the allocation of government income generated from either taxation or borrowings and the
government expenditure based on the approved national and local appropriation or budget. Public
Finance is also termed as fiscal administration.

PERSONAL FINANCE

Is a sub-category of private finance which is directed towards the management of personal resources
of an individual. The income of an individual is sourced from compensation, exercise of profession, or
business income as a sole proprietor. Income is allocated based on the individual’s personal needs such
as household expenses, education, hospitalization, and acquisition of personal and real properties.

BUSINECE FINANCE

Is an area of finance the focuses on the handling and management of financial resources of a business
organization. The three major divisions of business finance are financial management, capital market,
and financial investment:

FINANCIAL MANAGEMENT

Focuses on capital budgeting decision or investment decision on the acquisition of assets and its
corresponding financing scheme.

CAPITAL MARKET

Is an area of business finance that studies the different financial institutions and their functions that
provide assistance to both private and public borrowers of funds.

FINANCIALINVESTMENT

Includes business decisions about the value and price of stocks and bonds, portfolio analysis, market
analysis, and behaviour of the investors.

FUNCTIONS OF FINANCE OFFICER

Finance Officer plays a vital role in the whole business organization he is heavily engaged in making
decisions for the business to attain its objectives at the optimum level. His or her decision making
function is broadly classified into three :

1. Operating decisions
 2. Investing decisions
3. Financing decisions

OPERATING DECISION- are financial decisions affecting the routine operating activities of a business. It
directly provides immediate solution to the concerns of the functional areas of the firm such as
MANUFACTURING, MARKETING, PURCHASING, and the like.

INVESTING DECISIONS- deal with choosing small and large projects with several investment
opportunities. Such as evaluation in terms of return of investment (ROI) and expected CASH FLOWS.

FINANCING DECISIONS- deal with raising or acquiring funds from outside sources and not from the
ordinary results of the business operations. In other words, financing decisions are made when the
business needs to borrow money.

QUALIFICATIONS OF A FINANCE OFFICER

The chief finance officer must have the following qualifications:

1. Possesses sound knowledge of accounting and economic concepts and principles

2. Has profound understanding of operation science, statistics, and marketing research
3. Has gained technical experience in finance and provided professional judgment
4. Has good communication skills in both oral and written forms
5. Has impressive relationship with banks and other financial institutions.
6. Has outstanding relationship within the business and among other functional areas
7. Is ethically and morally upright and socially responsible
8.