BIRLA INSTITUTE OF TECHNOLOGY AND SCIENCE, Pilani

K.K. BIRLA Goa Campus

INSTRUCTION DIVISION
SECOND SEMESTER 2017-2018
Course Handout (Part II)

08/01/2018
In addition to part-I (General Handout for all courses appended to the timetable) this portion gives further
specific details regarding the course

Course No. : ECON F315 / FIN F315

Course Title : FINANCIAL MANAGEMENT
Instructor-in-Charge : Dr. A.K. MISHRA
Instructor : Dr. RAMMOHAN MENON

1. Scope & Objective Of The Course

Every business encounters certain inherent questions such as

 What capital investments should one make? i.e., what kinds of real estate, machineries,
R&D Programmes, I.T. infrastructure, and so on should one invest in?
 How should one raise money to pay for the proposed capital investments? i.e., what will
be the mix of equity and debt in your financial planning?
 How will one handle the day-to-day financial activities like collecting receivables and
paying your suppliers?
While these are not the only concerns of Financial Management, they certainly are the central
ones. This course shall discuss the theories, analytical methods and practical considerations that
are helpful in addressing issues in Financial Management, the understanding of which has
become of great significance in recent times.

2. After completing this course the students shall be able to:

 Build understanding of central ideas and theories of modern finance.

 Develop familiarity with analytical techniques helpful for financial decision making
 Develop an understanding of the environment in which financial decisions are taken.
 Identify, evaluate and implement investment decisions such as to make optimum use
of the capital employed.
 Analysis of cost and key factors to optimize return

On a more basic level, you should also be able to answer the following questions:

 What is Capital budgeting? And it’s relevance.

 How critical is working capital management? And what are its essential components.
 How is financial performance analysed?
 What is time value of money? How does it influence investment options?

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 BIRLA INSTITUTE OF TECHNOLOGY AND SCIENCE, Pilani
K.K. BIRLA Goa Campus
INSTRUCTION DIVISION
SECOND SEMESTER 2017-2018
Course Handout (Part II)

3. Comprehensive Course Plan:

Lecture
Learning Objectives Topics to be covered
No.

Overview of Introduction to Accounting theory and process. Generally

1-2
Accounting Accepted Accounting Principles (GAAP).

Financial Statement Balance Sheet, Profit And Loss Account, Statement Of Cash Flow.
3-6
And Cash Flow

Types Of Financial Ratios, Liquidity Ratios, Leverage Ratios,

Financial Statement Turnover Ratios, Profitability Ratios, Valuation Ratios, Study Of
6-9
Analysis Comparison With Industry Averages, Time Series Analysis And
Common Size Analysis. Prediction of Bankruptcy

Working Capital Policy includes, Characteristics Of Current Assets,

Working Capital Factors Influencing Working Capital Requirements, level of current
10-13
Management assets financing policy, Operating Cycle Analysis. Sources of
working capital finance

Cash and Liquidity Cash budgeting, long term cash forecasting, report for control, cash
Management, collection and disbursement, Investment of surplus, Need For
14-18
Inventory Inventories, Order quantity – EOQ Model, Order Point, Cash and
Management Receivable management

Time Value of Concept of Present value, Compounding, annuities, loan

19-20
money amortization

Techniques of Capital Budgeting, which includes capital budgeting

process, project classification, investment criteria, NPV, IRR.
21-26 Capital Budgeting
Capital Budgeting under inflation and project selection at capital
rationing

Long Term Raising long term finance through venture capital, initial public
27-28
Financing offer, etc. Sources of long term finance such as equity.

Capital Structure EBIT – EPS analysis, ROI - ROE analysis, Guidelines for capital
29-31
Decision structure planning.

Short-term decision Cost Analysis, CVP analysis , Key factor and decision making
32-37
making

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 BIRLA INSTITUTE OF TECHNOLOGY AND SCIENCE, Pilani
K.K. BIRLA Goa Campus
INSTRUCTION DIVISION
SECOND SEMESTER 2017-2018
Course Handout (Part II)

Dividend Decision Dividend Policy, methods of valuation, Valuation of Bond, Shares

38-40
and Valuation

4. Instructional Materials
The reading of some parts of the book is compulsory. As additional bibliography, the following
textbooks have been recommended for further study and reference:

1. Text Book “Financial Management Text Problems and Cases”, by M.Y.Khan and P.K.Jain
2. Further Readings
(i) “Financial Management Theory and Practice”, by Dr. Prasanna Chandra
(ii) “Fundamentals of Financial Management”, by Dr. Prasanna Chandra
(iii) “Managerial Finance”, by Lawrence Gitman
The following websites are suggested to refer for some valuable input for the study and analysis.

1. http://www.sebiedifar.nic.in
2. http://www.icai.org
3. http://www finance.yahoo.com
4. http://www moneycontrol.com
5. http://www businessfinancemag.com
6. http://www cpafinder.com/accounting
7. http://www indialedger.com
8. http://www india-financing.com
9. http://www icmai.in

5. Conduct of Course:
This course will be conducted in a lecture, Presentations, case study and problem solving
approach. The professor discusses the concepts, underlining principles and the application of
those theories and principles to the practical applications of real life.
6. Evaluation method:

Sl. Evaluation Duration Weightage Date, Time & Venue Nature of

Component
No. Component (%)

1 MID SEM EXAM 90 Min. 30 10/03/18, Saturday Closed

(2.00-3.30 AM) Book

2 Project & - 20 To be announced Open Book

Assignments/Case later
Study

3 Quiz 2 Nos ( One will - 10 To be announced Closed

be surprise quiz) later Book

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 BIRLA INSTITUTE OF TECHNOLOGY AND SCIENCE, Pilani
K.K. BIRLA Goa Campus
INSTRUCTION DIVISION
SECOND SEMESTER 2017-2018
Course Handout (Part II)

4 COMPRE EXAM 3 40 12/05/18, Saturday Closed

HOURS (9.00-12.00 Noon) Book

7. Chamber Consultation hours: Wednesday 12.00 Noon-12.50 PM

8. Notices: Notices would be displayed on DEPARTMENT OF ECONOMICS Notice Boardand/or

Photon/LMS.
9. Make-up: Make-up may be given only on genuine grounds. Prior permission has to be obtained.

10. Other Course Policy Issues:

 Course Class Coverage and details of specific topics from the chapter will be announced in the class
from time to time.
 Assignment/Problem Sheets and Reading Assignments will be assigned periodically. They must be
worked out to understand the subject. For Reading Assignments, students are expected to consult the
books as advised in the classroom.
 The Course Empirical Project is a group project in which students form a small team and work on a
practical empirical topic using modern econometric techniques. Further information and material on the
empirical project will be made available as the course proceeds. You will be expected to collect and
analyze a data set using the econometric methods.
 No makeup examination will be given for class tests and quizzes.
 Students are expected to attend class and to arrive on time and prepared. You should read the
sections in the textbook we are going to cover in class prior to following the lecture.

The instructor reserves the right to make adjustments to this syllabus. Any change will be notified
at least one week in advance. But it is your responsibility to stay informed if you do not attend all
the classes.

Instructor-in-Charge
ECON F315/ FIN F315

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