Financial Management Course Outline
Financial Management Course Outline
Course objectives
To provide an understanding regarding fundamentals of financial management
To enable students to understand financial decision-making and its role in the decision-
making process of the entire firm
To understand the role of financial planning and control
To understand the concepts and the application of working capital and its components,
short term and long term sources of financing, different theories of capital structure
Course outline
Topic Subtopics
OVERVIEW OF FINANCIAL Introduction
MANAGEMENT Financial decisions
The Goal of the firm
Organization of financial management
The financial Environment
THE TIME VALUE OF MONEY- The Interest Rate
APPLICATION & PRACTICE Simple Interest
Compound Interest
Single amount, annuities and mixed flows
Compounding more than once a year
Semiannual and other compounding periods,
Continues compounding
Effective Annual interest rate
Amortizing loan
FINANCIAL STATEMENTS ANALYSIS Need for Financial Statement Analysis
Tools of FSA
Liquidity Ratios
Debt Ratios
Efficiency Ratio
Profitability Ratios
FINANCIAL PLANNING & Financial planning
FORECASTING Forecasting financial statements
Techniques for Forecasting Financial Statements
The AFN Formula
THE VALUATION CONCEPTS The valuation process
The fundamental valuation model,
Valuation of securities: Bond, preferred stock.
RISK AND RETURN Risk Behavior, Return , Risk Measurement
WORKING CAPITAL MANAGEMENT The Cash Conversion cycle
Managing Cash & Marketable
Receivable Management
Inventory Management
CAPITAL BUDGETING Importance of Capital Budgeting
Generating Ideas for Capital projects
Projects Classification
Estimating Cash flows
Scenario and Sensitivity
Capital budgeting Techniques
CAPITAL STRUCTURE Leverage Theory and Analysis.
OPERATING & FINANCIAL Operating leverage
LEVERAGE Financial leverage
Total leverage
Cash flow ability to service debt
MERGERS & ACQUISITIONS Needs and motive for mergers
Types of mergers
Friendly & Hostile take offs
Valuing mergers
Students registered in this course will compulsorily required to regularly appear in tests, quizzes,
presentation and other assignments those will be given throughout the semester.
RECOMMENDED BOOKS: