FINANCIAL MANAGEMENT

MBA, Semester – II
(COURSE CODE 202) FINANCIAL MANAGEMENT

Unit

Contents

Sessions

1

Business Finance

Introduction of Business Finance: Meaning, Definition of Financial Management, Goals of Financial Management (Profit Maximization and Wealth Maximization), Modern approaches to Financial Management – (Investment Decision, Financing Decision and Dividend Policy Decisions) Finance and other related disciplines, Functions of finance manager, Key strategies of financial management, Financial Planning – Principles and Steps in Financial Planning.

2

Capital Structure

Meaning, Factors affecting the capital structure, Different Sources of Finance and its Types, Concept and measurement of cost of capital, measurement of specific costs WACC, Trading on equity and its types.

3

Techniques of Financial Analysis

Meaning , Nature, Objectives, Understanding of financial statements, Schedule VI of Companies Act, Tools of analysis, interpretation and limitations of financial analysis, Fund flow statement (Working capital basis), Understanding Cash flow statement – Difference between Cash flow and Fund flow statement, Ratio analysis (computation and interpretations of ratios)

4

Capital Budgeting

Meaning, Definition and types of evaluating the project on the basis of Traditional Techniques and Modern Techniques (viz. Payback period, Discounted Payback period, NPV, ARR, IRR, PI) Time Value of Money.

5

Working Capital Management

Nature and Scope, Components of working capital, operating cycle, types of working capital, Sources of Working Capital Financing, Factors affecting working capital, estimation of working capital requirement.