ASSAM UNIVERSITY SYLLABUS (NON - HONS): FUNDAMENTALS OF FINANCIAL MANAGEMENT (5th SEM - CBCS PATTERN)

B.Com: Semester V

Paper B.C. 5.1 (a): FUNDAMENTALS OF FINANCIAL MANAGEMENT

Internal Assessment -30

Term End Exam - 70

Marks: 100

Lectures: 65

Objective: To familiarize the students with the principles and practices of financial management.

Contents:

Unit 1: Introduction

8 Lectures                20

Nature, scope and objective of Financial Management, Time value of money, Risk and return (including Capital Asset Pricing Model), Valuation of securities- Bonds and Equities.

Unit 2: Investment Decision

20 Lectures                   20

The Capital Budgeting Process, Cash flow Estimation, Payback Period Method, Accounting Rate of Return, Net Present Value (NPV), Net Terminal Value, Internal Rate of Return (IRR), Profitability Index, Capital budgeting under Risk – Certainty Equivalent Approach and Risk-Adjusted Discount Rate.

Unit 3: Financing Decision

20 Lectures                  20

Cost of Capital and Financing Decision: Sources of long-term financing Estimation of components of cost of capital. Methods for Calculating cost of equity capital, Cost of Retained Earnings, Cost of Debt and Cost of Preference Capital, Weighted Average cost of capital (WACC) and Marginal cost of capital. Capital structure-Theories of Capital

Structure (Net Income, Net Operating Income, MM Hypothesis, Traditional Approach). Operating and financial leverage. Determinants of capital structure.

Unit 4: Divident Decisions

12 Lectures                    20

Theories for Relevance and irrelevance of dividend decision for corporate valuation; Cash and stock dividends; Dividend policies in practice

Unit 5: Working Capital Decisions

15 Lectures             20

Concept of working capital, the risk-return trade off, sources of short-term finance, working capital estimation, cash management, receivables management, inventory management and payables management.

Suggested Readings:

1. James C. Van Horne and Sanjay Dhamija, Financial Management and Policy, Pearson Education.

2. Levy H. and M. Sarnat. Principles of Financial Management. Pearson Education.

3. Joy, O. M. Introduction of Financial Management. Mc Graw Hill Education.

4. Brigham and Houston, Fundamentals of financial Management, Cengage Learning.

5. Khan and Jain. Basic Financial Management, McGraw Hill Education.

6. Chandra, P. Fundamentals of financial Management, McGraw Hill Education.

7. Singh, J. K. Financial Management- text and Problems. 2nd Ed. Dhanpat Rai and Company, Delhi

8. Rustagi, R.P. Fundamentals of financial Management, Taxmann Publication Pvt. Ltd.

9. Singh, Surender and Kaur, Rajeev. Fundamentals of financial Management, Mayur Paperback, New Delhi.

10. Pandey, I.M. Basic Financial Management, Vikas Publications.

11. Bhabatosh Banerjee, Fundamentals of financial Management, PHI Learning.