One of the goals of finance management is to maximize shareholder wealth. In an initial post of 300 words or less, discuss the advantages and disadvantages from the standpoint of the company. Select a passage from the Bible and its related parable and identify what benefit does this provide to our beliefs.
Support your post with two scholarly journal references from outside sources and/or Regent University database.
in 125 words or less in APA format, supporting or challenging their beliefs.
Below is my fellow students response to the original post that I need to respond to.
One of the goals of financial management is to maximize shareholder wealth. While there are many advantages to this, the disadvantages of this goal cannot be taken lightly. One disadvantage is that it is not a simple task since the financial manager cannot controls the stock price of the firm directly; they can only act in a way that coincides with the desires of the shareholders. While the economy is up, there is not much to worry about, however, the stock market is unpredictable and outside of the control of the of the financial manager. The advantages to financial management include organization and better planning when it comes to data, more stability within the company, and more maximization of the wealth of the shareholders as well as the company.
It’s best to prepare today for the needs of tomorrow.
In the parable of the ant and the grasshopper, we learn that it is better to be prepared and plan for the future. “Go to the ant, you lazybones! Consider its ways and be wise. Without having any captain or officer or ruler, it prepares its food in summer, and gathers its sustenance in harvest” (Prov. 6:6-9, NRSV). Financial management can relate to the parable in Proverbs of the ant and the grasshopper, as the ant prepares its food in the summer for the long winter that it knows it is about to embark on. Similarly, financial managers need to plan not only for the future of each individual client and the shareholders wealth yet also for the possible rise and falls of the stock market and the economic situation. Hard work and planning is always more rewarding than just breezing by taking the easy way out, and although there may be trials faced in the process they will be well worth the overcoming of each challenge.
Chandra, P. (2010). Fundamentals of financial management. New Delhi: Tata McGraw-Hill Education.