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Vinu,

Responding to both your questions:

Requirements specification describes, usually in some form of document, the conditions or capabilities that must be met to solve a problem or achieve an objective for a given stakeholder.  Requirements are the "what needs to exist" part.

Functional specification describes how the proposed solution will function, it's behavior, to provide the needed solution.  Functional specifications address some of the "how to satisfy the needs" part.   

However, you can have requirements that are non-functional.  For example, a requirement may exist that states "the solution must be coded in Java".  The Functional solution(behavior) should meet the needs (requirement) regardless of the programming language.

I hope this helps you out.

Brad Botz

Prime Proficiency