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Financial Management (Theory)
Course Objectives: This course will enable the students to – • Enable students to develop the understanding of financial management concepts and capitalization decisions. • Develop an understanding and sound knowledge among students about the adequate capital structure of an organization and identifying various sources of finances.
Course Outcomes (COs):
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Course |
Learning outcomes (at course level) |
Learning and teaching strategies |
Assessment Strategies |
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Course Code |
Course Title |
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CBBA 405 |
Financial Management |
CO 183: The course would help the students to demonstrate the applicability of the concept of Financial Management to understand the managerial Decisions. CO 184: Students will be able to understand the various sources of finance and the ways of managing working capital. CO 185: Students will be able to analyze the complexities associated with management of cost of funds in the capital Structure and various dividend decisions. CO 186: Students will be able to evaluate various projects through capital budgeting decisions. CO 187: The course would enable students to remember various ways of managing inventory and receivables. CO 188: Students will be able to comprehend the various ways of managing cash and adequate liquidity in the business. |
Approach in teaching: Interactive Hours using whiteboards, Questioning & Discussion, Reading assignments, Frequent or unannounced quizzes.
Learning activities for the students: Self learning assignments, Effective questions, presentation, Solving problems of unsolved questions
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Class test, Semester end examinations, Quiz, Assignments, Class interaction |
Nature of Financial Management: Finance and related disciplines; Scope of Financial Management; Profit Maximization, Wealth Maximization - Traditional and Modern Approach; Functions of finance.
Capitalization – Under Capitalization and Over Capitalization.
Sources of finance: Classification - Short Term and long term sources of finance. Introduction about Financial Institutions-IDBI, IFCI, ICICI Working Capital Management: Operating cycle method and Net current asset or forecasting method.
Capital Structures: Approaches to Capital Structure Theories - Net Income approach, Net Operating Income approach, Modigliani-Miller (MM) approach, Traditional approach.
Dividend Policy: Dividend models MM hypothesis, Walter's model, Gordon's model.
Leverage Analysis: Operating and Financial Leverage
Capital Budgeting - Principles and Techniques; Nature and meaning of capital budgeting; Estimation of relevant cash flows and terminal value; Evaluation techniques - Accounting Rate of Return, Net Present Value, Internal Rate of Return, Net Terminal Value, Profitably Index Method.
Management of Cash and Liquidity: Motives of holding cash, cash management, Cash Planning and Forecasting.
Management of Inventory: Need to hold inventory, Objectives, importance and functions of Inventory Management, Techniques of Inventory control.
Management of Receivables: Cost associated with receivables, Objective and Factors affecting Investment in receivables, Credit Evaluation.
Essential Readings:
• M.Y. Khan & P.K. Jain: Financial Management Text Problem and Cases, Tata McGraw Hill Pubilshlng Co. Ltd.
• R. P. Rustogi: Financial Management: Theory Concepts and Practices, Taxmann Publication.
• I.M. Pandey: Financial Management: Theory and Practices, Vikas Publishing House
Suggested Readings:
• R.A. Brealey, S.C. Myers, F. Allen& P. Mohanty: Principles of Corporate Finance, McGraw Hill Higher Education
• J.V. Horne & J.M. Wachowicz: Fundamentals of Financial Management Prentice Hall
E-Resources:
• https://www.expresslibrary.mheducation.com/bookshelf
• MS-109.pdf (uou.ac.in)
Journals:
• http://publishingindia.com
• http://www.oiirj.org
• http:// sagepub.com
