Fundamentals of financial management / Vyuptakesh Sharan.

Format:

Book

Author/Creator:

Sharan, Vyuptakesh, author.

Series:

Always learning

Language:

English

Subjects (All):

Corporations--Finance--Management.

Corporations.

Finance--Management.

Finance.

Physical Description:

1 online resource (1 volume) : illustrations

Edition:

Third edition.

Place of Publication:

Delhi, India ; Chennai, India ; Chandigarh, India : Pearson, [2012]

System Details:

text file

Summary:

With the growing complexities involved in corporate financial decisions, financial management has undergone a sea change in recent years. Fundamentals of Financial Management focuses on keeping readers abreast of these changes and acquainting them with the theoretical concepts and analytical tools in the field of financial management. Readers new to the subject, and especially those not well versed with business terminology, will find this book invaluable.

Contents:

Cover

Preface to the Third Edition

Preface

Contents

About the Author

Part I: Fundamental Concepts of Financial Management

Chapter 1: Nature and Goal of Financial Decisions

1.1 Nature of Financial Decisions

1.1.1 Long-term Investment Decision

1.1.2 Working Capital Decision

1.1.3 Financing Decision

1.1.4 Dividend Decision

1.2 Factors Influencing Financial Decisions

1.2.1 Microeconomic Factors

1.2.2 Macroeconomic Factors

1.3 Objective of Corporate Financial Decisions

1.3.1 Profit Maximisation

1.3.2 Objective of Wealth Maximisation

1.3.3 Appraisal of the Objective of Maximisation of Corporate Wealth

1.3.4 The Agency Problem

Summary

Points to Remember

Descriptive Questions

Objective-type Questions

Study Topic: Managing Agency Problem

References

Select Further Readings

Chapter 2: Time Value of Money

2.1 The Concept

2.2 Computation of Future Value

2.2.1 Future Value of a Single Amount

2.2.2 Future Value of a Series of Payments

2.2.3 Future Value in Case of Annuities

2.2.4 Frequency of Compounding

2.3 Computation of Present Value of Cash Flows

2.3.1 Present Value of a Single Amount

2.3.2 Present Value of a Series of Future Values

2.3.3 Present Value in Case of Annuity

2.3.4 Special Cases of Annuity

2.3.5 Present Value of a Cash Flow with Growth Element

Numerical Problems

Solved Numerical Problems

Chapter 3: Concept of Risk and Return

3.1 Basic Concepts of Returns

3.1.2 Average Return: Simple and Weighted Average

3.1.3 Arithmetic and Geometric Mean

3.1.4 The Concept of Probability

3.1.5 Expected Return from a Single Investment

3.1.6 Expected Returns from International Investment.

3.1.7 Portfolio Return

3.2 Concept and Measurement of Risk

3.2.1 Sources of Risk

3.2.2 Risk in Case of a Single Investment

3.3 Portfolio Risk

3.4 The Capital-Asset-Pricing Model (CAPM)

3.4.1 Systematic Risk versus Unsystematic Risk

3.4.2 Measurement of Systematic Risk and Determinants of Beta

3.4.3 Beta and the Required Rate of Investment

3.4.4 Security Market Line

3.4.5 Appraisal of CAPM

Chapter 4: Valuation of the Firm

4.1 Various Concepts of Value

4.1.1 Intrinsic Value

4.1.2 Market Value

4.1.3 Book Value

4.1.4 Liquidation Value

4.1.5 Going-concern Value

4.1.6 Replacement Value

4.2 Valuation of Bonds or Debentures

4.2.1 Valuation of Bonds with Fixed Maturity

4.2.2 Perpetual Bonds

4.3 Factors Influencing Bond Valuation

4.3.1 Discount Rate versus Coupon Rate

4.3.2 Maturity and Value of Bonds

4.3.3 Yield to Maturity

4.3.4 Duration and the Bond Price

4.3.5 Riskiness and the Value of Bond

4.4 Valuation of Preference Shares

4.5 Valuation of Ordinary Shares

4.5.1 Single-period Analysis

4.5.2 Multi-period Analysis

4.5.3 P/E Ratio Approach to Equity Valuation

Reference

Select Further Reading

Appendix A

Appendix B

Part II: Long-term Investment Decision

Chapter 5: Principles of Capital Budgeting

5.1 Nature of Capital Budgeting

5.1.1 Meaning and Significance

5.1.2 Types of Proposals

5.1.3 Steps in Capital Budgeting Process

5.2 The Concept of Cash Flows

5.2.1 Nature and Timing of Cash Flows.

5.2.2 Factors Considered for Cash Flow Computation

5.2.3 Process of Computation

5.3 Project Evaluation Criteria

5.3.1 NPV Rule

5.3.2 Profitability Index

5.3.3 Profitability Ratio Versus NPV

5.3.4 IRR Rule

5.3.5 NPV versus IRR

5.3.6 Modified IRR (MIRR)

5.3.7 Pay-back Period

5.3.8 Accounting Rate of Return

Chapter 6: Capital Budgeting in Practice

6.1 Capital Rationing

6.1.1 Conditions of Capital Rationing

6.1.2 Capital Rationing and the Choice for a Proposal

6.2 Capital Budgeting Under Inflationary Conditions

6.3 Decision Concerning Mutually Exclusive Proposalswith Unequal Lives

6.3.1 Annualised NPV Method

6.3.2 Replacement Chain Method

6.4 The Conditions of Risk

6.4.1 Inclusion of Risk Factor in Cash Flow

6.4.2 Risk Analysis Based on Portfolio Approach

6.4.3 Sensitivity Analysis

6.4.4 Scenario Analysis

6.4.5 Monte Carlo Simulation

6.5 Managerial Options and the Cash Flow

6.5.1 The Decision-tree Approach

6.6 International Capital Budgeting

6.6.1 Parent's Perspective and the Cash flow

6.6.2 Parent-Subsidiary Perspective

Chapter 7: Cost of Capital

7.1 Significance of Cost of Capital

7.2 Computation of the Cost of Capital

7.2.1 Cost of Debt

7.2.2 Cost of Preference Share Capital

7.2.3 Cost of Equity Shares

7.2.4 Cost of Retained Earnings

7.3 Weighted Average Cost of Capital

7.3.1 The Measurement

7.3.2 The Influencing Factors

7.4 Marginal Cost of Capital

Points to Remember.

Descriptive Questions

Part III: Working Capital Management

Chapter 8: Working Capital Policy

8.1 Concept of Working Capital

8.1.1 Gross and Net Working Capital

8.1.2 Permanent and Variable Working Capital

8.2 Size of Current Assets

8.2.1 Assessment of the Size: The Concept of Operating Cycle

8.2.2 Ratio between Current Assets and Fixed Assets: Liquidity versus Profitability

8.2.3 Other Factors Influencing the Size of Current Assets

8.3 Financing of Current Assets

Chapter 9: Management of Cashand Near-Cash Assets

9.1 Cash Planning

9.1.1 Motives behind Holding Cash

9.1.2 Ascertaining Cash Requirements

9.2 Managing Cash Inflows and Outflows

9.2.1 The Concept of Float

9.2.2 Instruments of Cash Collection

9.2.3 Ways to Accelerate Cash Collections

9.2.4 Controlling Disbursements

9.3 Investment of Surplus Cash in Near-Cash Assets

9.3.1 Determination of Ratio between Cash and Near-Cash Assets

9.3.2 Optimal Cash Balance under Conditions of Certainty: Baumol Model

9.3.3 Optimal Cash Balance under Uncertainty: The Miller-Orr Model

9.3.4 Selection of Near-Cash Assets

9.4 Cash Management in International Firms

9.4.1 Intra-firm Transfer of Funds in Presence of Exchange Control

9.4.2 Investment of Surplus Cash

Chapter 10: Management of Accounts Receivable

10.1 Benefits and Costs of Accounts Receivable.

10.1.1 Benefits

10.1.2 Costs

10.2 Credit Policy

10.2.1 Optimising the Term of Credit

10.2.2 Changes in Credit Standard

10.2.3 Discount Policy

10.3 Selection of Customers

10.3.1 Collecting Necessary Information

10.3.2 Analysis of the Information

10.3.3 Fixation of the Credit Limit

10.4 Monitoring and Control of Credit

10.4.1 Monitoring at the Customer's Level

10.4.2 Monitoring at the Aggregate Level

10.4.3 Factoring

10.4.4 Forfaiting

Chapter 11: Inventory Management

11.1 Benefits and Cost of Maintaining Inventory

11.1.1 Benefits

11.1.2 Costs

11.2 Goal of Inventory Management

11.2.1 Classification of Inventories

11.2.2 Economic Order Quantity (EOQ)

11.2.3 Determination of Re-order Point

11.2.4 Safety Level of Stock

11.3 Just-in-time Inventory System

Chapter 12: Sources of Short-term Finance

12.1 Trade Credit

12.1.1 Nature of Trade Credit

12.1.2 Benefits and Costs of Trade Credit

12.1.3 Stretching of Accounts Payable

12.2 Bank Finance

12.2.1 Nature of Bank Finance

12.2.2 Effective Interest Rate

12.2.3 Bank Financing Norms in India

12.3 Other Sources of Short-term Funds

12.3.1 Commercial Papers

12.3.2 Public Deposits

12.3.3 Intercorporate Deposits

Part IV: Long-term Financing and Dividend Decisions

Chapter 13: Capitalisation.

13.1 Significance and Bases of Capitalisation.

Notes:

Includes indexes.

Includes bibliographical references.

Description based on online resource; title from title page (viewed June 25, 2013).

ISBN:

9789332508170

9332508178

9788131776032

8131776034

OCLC:

852523089