Afm 6th Sem Bcom 2024

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Course Code 6.

1
Title: ADVANCED FINANCIAL MANAGEMENT
Category Course – DSC 16
Teaching Hours: 3 + 2
Total Marks: 60 + 40
Credits : 4
Total Hours – 60
Pedagogy
Classroom Lecture, Case Studies, Tutorial Classes, GD, Seminar and
Field work Etc

Objectives/Outcomes:
• Understand and determine Cost of Capital
• Comprehend different advanced CB Techniques
• Understand the importance of Dividend Decisions
• Evaluate Mergers & Acquisitions
• Understand the Ethical & Governance issues in FM
Module 1 14 Hrs
Cost of Capital & Capital Structure Theories
• CoC – Meaning, Definitions, Significance, Types
• Computation of CoC:
Specific Cost – Cost of Debt – Cost of PSC – Cost of ESC –
Weighted Avg CoC – Problems

• CS Theories – The Net Income Approach


The Net Operating Income Approach
Traditional Approach & MM Hypothesis
• Problems
Module 2 14 Hrs
Risk Analysis in Capital Budgeting
• Risk Analysis – Types, Risk & Uncertainty,
Techniques of measuring risk – Risk adjusted
Discount Rate Approach, Certainty Equivalent
Approach, Sensitivity Analysis, Probability
Approach, Std Deviation & Co-efficient of Variation
• Decision Tree Analysis
• Problems
Module 3 14 Hrs
Dividend Decisions & Theories
• DD – Meaning, Types of Dividends & D Policies
• Significance of Stable DP – Determinants of DP
• Dividend Theories – Theories of Relevance,
Walter’s Model & Gordon's Model
• Theory of Irrelevance - MM Hypothesis
• Problems
Module 4 10 Hrs
Mergers & Acquisitions
• Meaning, Reasons, Types of Combinations & Mergers –
Motives & Benefits
• Financial Evaluation of a Merger – Merger Negotiations,
Leverage Buyout, Mgt Buyout,
• Meaning & Significance of P/E Ratio
• Problems on Exchange Ratios based on Assets
Approach, Earnings Approach & Market Value Approach
&
• Impact of Merger on EPS, Market Price & Market
Capitalisation
Module 5 8Hrs
Ethical & Governance Issues
• Introduction to E & G I
• Fundamental Principles
• EI in FM – Agency Relationship, Transaction Cost
Theory
• Governance Structure & Policies, Social &
Environmental Issues
• Purpose & content of an Integrated Report.
QP Pattern
• Section – A: 2 Marks – Six out of Eight ?s

• Section – B: 4 Marks – Three out of Five ?s

• Section – C: 12 Marks – Three out of Five ?s


Blue Print
Module Title 2 Marks 4 Marks 12 Marks Total Marks

1 CoC & CST 2 1 (P) 1 (P) 20

2 RA in CB 2 1 (P) 1 (P) 20

3 DD & T 2 1 (T) 1 (P) 20

4 M&A 1 1 (T/P) 1 (T/P) 18

5 E & G Issues 1 1 (T) 1 (T) 18

Total No. of ?s 08 05 05 (18) -----

Total Marks 16 20 60 96
Skill Development
• Visit an organisation & collect data about the financial objectives
• Compute the Specific Cost & WAC of capital of an organisation you
visited
• Case analysis of some live merger reported in business magazines
• Meet the financial manager of any company, discuss ethical issues
in FM
• Collect the data relating to Dividend Policies practices by any two
companies
Case Study - Sources
– Harvard publishes CS on merger of Indian Bank & Allahabad
Bank
– Business Today – Air India & Indian Airlines
– Progressive Academic Publishing – SKYPE & Microsoft
– SBI with 5 Associated Banks
– FIAT Chrysler Automobiles & Groupe Renault
– Flipkart & Myntra
– Walmart’s Acquisition of Flipkart

globalgeek link 100 + CS


management consulted.com – 600 + CS
Reference Books
• I M Pandey – Vikas Publications
• Khan & Jain – TMH
• S N Maheshwari – Sultan Chand & Sons
• Ravi M Kishore – Taxman
• Prasanna Chandra – Tata McGraw Hill
• Shashi K Gupta - Kalyani Publication
WITH BEST WISHES & REGARDS FROM
Prof. SHANKARACHARYA
Principal – VEIT DEGREE COLLEGE
Director of Academics – Vijaya Education Institute Trust
Southend Cirlce, 3rd Block, Jayanagar, Bangalore - 11
And

Dr. B M Ramamurthy
AIMS Institutes, Peenya,
Bangalore – 58

THANK YOU ALL

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