Buddha Manjushri is the Wisdom Buddha - the embodiment of the omniscient wisdom of all enlightened beings.
His left hand is in the gesture of teaching Dharma and holds the stem of a lotus flower that supports the Perfection of Wisdom Sutra.
The flaming sword in his right hand symbolizes the power of wisdom to cut through ignorance, the root of all suffering. By relying upon Buddha Manjushri, our own wisdom naturally increases.
For more information, see the book Heart Jewel, the sadhana Treasury of Wisdom, and the CD Songs of Wisdom & Compassion.