Finance is a lifeblood of the business. No business firm can carry on its operations smoothly and successfully without the availability of the right amount of funds at the right cause and other right time. The success of a business depends to a great extent, on the manner in which it raises, employs and disburses its funds.
Adequate finance provides the following benefits to a business concern:
- The firm can meet its liabilities in time. Prompt payment of debts helps in raising credit standing. As a result can borrow funds when necessary.
- More business opportunities will be available.
- No interruptions will be there business will run smoothly.
- Efficiency of the firm will increase.
- The firm can easily face crises and any recession confidently.
- The availability of funds determines the size and scale of operations of a business enterprise.
- The employees will feel satisfied and work enthusiastically as they will get their salaries on time.
Therefore sound financial position enables an enterprise to enjoy good will and reputation in the business world.
