What exactly is Finance?

Finance deals with all aspects of money management including:

  • Investment banking - It involves advising companies on mergers & acquisitions, debt financing, equity offerings, etc.
  • Asset Wealth Management - This includes investment funds like a mutual fund or hedge fund which invest in stocks, bonds, real estate, commodities, derivatives, currencies, etc.
  • Banking – The term ‘Banking’ refers to a wide range of activities that banks perform such as lending, borrowing, investing, trading, asset securitization, credit analysis, etc.
  • Insurance – Insurers protect against risks associated with life events like death, disability, unemployment, illness, accidents, natural disasters, etc.
  • Accounting – Accountants prepare accounts for businesses so they can make informed decisions about their finances. They also help them manage cash flow, taxes, investments, etc. There are three main categories of accountancy; namely, auditing, tax preparation, and bookkeeping.

Auditors audit firms/companies while preparing income tax returns. Bookkeepers record transactions related to business operations. Tax Preparers prepare tax returns based on information provided by clients.