Based On The Financial Strategy Of The Business Life Cycle Study

1. BackgroundAs an independent subject, the theory of financial management has made remarkable achievements in nearly one hundred years. The financial management focuses on enterprise' financial activities and the planning and controlling of funds. It manages the value of the enterprises and requires knowledge in many fields, the financial management nowadays has already become a comprehensive system in fund-raising, investment decision and assets management of the enterprises. It is essential in making scientific management, playing a more and more important role.Since the 1980's, with the rapid development of the Hi-Tech industry, the innovation of the finance and market, and the increasing enterprise's M&A , the environment of financial management is changing rapidly, enterprises are required to make great changes. As financial derivatives are connected with great uncertainties, a simple trade is often turned into a complicated one. In M&A tides, the acquiring company does not hesitate in paying higher prices. All these have created both chance and challenge for the management of enterprise. How to make profits in the changing environments is now an overwhelming concern of the management. For a long time, however, the study on financial management is still based on basic theories of microeconomics by adopting too much mathematics methods, instead of based on the enterprise' overall and long-term development, which I think is far more important. In my viewpoint,the financial management is more an art than a science. In recent years, the crises of many enterprises in China are connected to a great extent with bad financial management. We need to think more about these lessons. The profound reason in my opinion is the lack of strategic idea in financial management theory and practice.