Semester-4
Financial Management
1] FINANCIAL MANAGEMENT : An overview
- Evolution of finance function : traditional v/s modern approach - goals of finance function - position of finance function in organization structure.
2] LONG TERM SOURCES OF FINANCE :
- Equity - preference - debenture - bonds. Financial evaluation from the view point of company as well as investors only.
3] CAPITALIZATION :
-Meaning of over and under capitalization - merit and demerit and remedial measures.
4] CAPITAL BUDGETING :
a] Basic of capital budgeting: meaning - significance - process.
b] Estimation of cash flow based on Straight Line depreciation and written down value methods.
c] Appraisal method: PBP - ARR - NPV - IRR and PI.
d] Ranking conflicts and Resolution.
e] Capital rationing and sub-optimation ( excluding replacement decision )
5] WORKING CAPITAL MANAGEMENT :
a] Overview - concepts - significance - factors affecting working capital - estimation of working capital based on operating cycle approach. Two dimensions of W.C. mgt. Relative asset liquidity and relative financing liquidity.
b] Working Capital Financing :
Sources of working capital finance including intercorporate loans - determining maximum permissible bank finance based on Tondon and Chore committee recommendations.
d] Management of Cash:
Cash planning - managing the flow - cash control report - investment in marketable security.
e] Management of Inventory:
Need to hold inventory - optimum investment inventory - E.O.Q. techniques - Selective inventory control ( ABC analysis only ).
6] Leverage Analysis :
Operating leverage - financial leverage and combined leverage - their implication.