The Importance of Financial Management

AXA Professional Financial Consultant: The Importance of Financial Management

Financial management is a subject that is very interesting as we approach the 21st century. Both print and electronic media present the story - a dramatic story about the growth and decline in the company - the company, corporate takeovers, and various types of corporate restructuring. To understand this development and to participate in it effectively requires a knowledge of financial principles.

It underlined the importance of finance with the dramatic developments that occurred in the financial markets. For example, in September 1989 Campeau Corporation was not able to pay off interest payments for some of its debts. Campeau bought Allied Stores and Federated Department Store earlier in the year 1989 with debts of $ 10 billion.

Campeau seek additional debt to meet interest payments due on existing debt and trying to sell the property - the main property as a series of department store Bloomingdale's to reduce the loan principal. Campeau failure to meet its interest payments shocked the entire high-yield bond market ("junk"). In January 1990, Campeau real estate operations are separated from the department store retail operations, are included in bankruptcy protection. How important a number of aspects of financial management has been emphasized by the history of this Campeau.

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