Strategic Objectives of Financial Management

There are 5 Strategic Objectives of Financial Management. 

A business can choose to focus on one or more of these objectives - however, they all relate to one another and influence one another. 

Focusing on improving one objective can result in degrading of another. For example, a focus on increasing profitability by using debt to produce more goods will negatively impact the solvency of the business. 

Also, business decisions have impacts at different time scales - short and long term impacts. For example, the purchase of stock to grow the business in the long term will negatively impact the liquidity of the business in the short term.

Each of the following Strategic Objectives can be tracked using specific financial ratios.