Aggressive approach of financial management, Financial Management

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Q. Aggressive Approach of financial management?

A -firm may be aggressive in financing its assets. An aggressive policy is said to be followed by the firm when it uses short-term financing than warranted by the matching plan. Under an aggressive policy, the firm finances. a part of its permanent current assets with short-term financing; some extremely. aggressive firms may even finance a part of their fixed assets with short-term financing. The relatively more use of short-term financing makes the firm more risky. The aggressive financing policy is illustrated in figure aside.

Short Term Financing

Long Term Financing

Fixed Assets

Time Conservative Financing

Long Term Financing

Fixed Assets

Time Aggressive Financing


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