Finance is the soul and blood of any business and no firm can survive without finance. It concerns itself with the management of monetary affairs of the firm–how money can be raised on the best terms available and how the procured money can be devoted to the best uses. Hence the nature of finance relates to the process of arrangement and application of funds.

Finance is the process of creating, moving and using money, enabling the flow of money through a company in much the same way it facilitates global money flow. Money is created by the sales force when they sell the goods or services the company produces, it then flows into production where it is spent to manufacture more products to sell. What remains is used to pay salaries and fund the administrative expenses of the company.