What are the elements of strategic financial management?

Strategic financial management is applied throughout a company's organizational operations and involves elements designed to make the maximum efficient use of the company's financial resources. Key elements of strategic financial management include budgeting, risk management, and review and evaluation.

Careful budgeting of a company's financial resources and operating expenses is essential in strategic financial planning. Budgeting helps a company function with general financial efficiency, and it aids in identifying areas of the company that incur the largest amount of operating costs or that regularly exceed budgeted cost. Budgeting includes ensuring sufficient liquidity to cover day-to-day operating expenses without accessing outside financial resources. Budgeting also addresses the question of how a company can invest earnings to achieve long-term goals more effectively.

Strategic financial management also involves risk assessment and risk management, evaluating the potential financial exposure a company incurs by making capital expenditures (CAPEX) or by instituting certain workplace policies.

Since strategic financial management is all about maintaining focus on attaining a company's long-term business goals, it necessarily includes developing and putting in place regular procedures for review and evaluation of how well the company is doing in terms of staying on track.

the given answer is related to 'Strategic leadership'