Determination of level of current assets.Sources for financing working capital. Bank finance for working capital. (Noproblems on estimation of working capital). Working capital financing:Short term financing of working capital, long term financing of workingcapital. Working capital leverages.
Forecasting cash flows – Cash budgets, long-term cashforecasting, monitoring collections and receivables, optimal cash balances –Baumol model, Miller-orr model,. Strategies for managing surplus fund.
Credit management through credit policyvariables, marginal analysis, Credit evaluation : Numerical credit scoring andDiscriminate analysis. Control of accounts receivables, Problems on creditgranting decision.
Determinations of inventory control levels :ordering, reordering, danger level. EOQ model. Pricing of raw material.Monitoring and control of inventories, ABC Analysis.
capital structure & market value of a firm.Theories of capital structure – NI approach, NOI approach, Modigliani Millerapproach, traditional approach. Arbitrage process in capital structure.Planning the capital structure: EBIT and EPS analysis. ROI & ROE analysis.Capital structure policy .
Theories of dividend policy : relevance and irrelevancedividend decision. Walter’s & Gordon’s model, Modigliani & Millerapproach. Dividend policies – stable dividend, stable payout and growth.Bonus shares and stock split corporate dividend behavior. Legal andprocedural aspects of dividends Corporate Dividend Tax.
Meaning and definition, . types of merger –motives behind mergers – theories of mergers – operating, financial andmanagerial synergy of mergers – value creation in horizontal, vertical andconglomerate mergers – internal and external change forces contributing toM & A activities
Agency problem and consideration. Effect of inflation on ; Asset value, firm value, returns, Financial planning – Basis of financial planning, sales forecast method, pro-forma P & L accountmethod, pro-forma balance sheet method, determination of ExternalFinancing Requirement (EFR). Financial Management of sick units:Definition of sickness, causes, symptoms, predictions, revival strategies,institutions for revival of sick units. Economic Value Added (EVA) –concept, components of EVA. Market Value Added (MVA)