Functional managers from non-finance functions managing various key business roles.

The Financial Management subject provides a conceptual framework of financial management at the introductory level. It is taught from the viewpoint of a corporate financial manager trying to maximize stockholder wealth. The subject examines the factors which determine the firm's need for external financing be it debt or equity and its optimal mix. Corporate finance deals with the financial decisions that a corporation makes and the tools and analysis used to make these decisions. The discipline of Financial Management can be broadly divided into long-term and short-term decisions and techniques. Capital investment decisions are long-term choices about which projects receive investment, how to finance that investment, and when or whether to pay dividends. On the other hand, the short term decisions can be grouped under the heading ‘Working Capital Management’ and focus on the study of the short-term balance of current assets and liabilities, managing cash, inventories, and short-term borrowing and lending.

• Understanding of the analytical framework underlying financial statements
• Understanding and application of Ratio Analysis
• Knowledge of financing metric: Performance and Wealth
• Understanding of key financial decisions in terms of analysing financial statements
• Get acquainted with the various determinants of a company’s value
• Learn and appreciate the basic tools of financial decision making such as time value of money and risk and return leading to capital budgeting decisions.
• Gain knowledge of investment decision through techniques of capital budgeting such as Payback period, NPV, IRR, etc
• Develop the relationship between Financing and Investment decisions
• Develop a primary level understanding of the various sources of long term finance, namely debt and equity.
• Develop an in-depth understanding of the choice of financing mix and the relevance of capital structure in a firm.
• Appreciate the importance of dividend decision as a means of shareholder value maximization- Tactical Financing Decisions

The course is interactive and is comprised of lectures, case studies, technical process learning and supplemental discussions related to various industries and the challenges of implementation.

Module 1: Financial Accounting and Reporting

• The meaning behind the numbers
• Financial Information-  it's use  to various stakeholders
• Review the building blocks of accounting principles, concepts and systems that support an accounting framework
• Users of financial information, requirements in the external world - Basics of preparing balance sheet, profit and loss account and cash flow statements

Module 2: Managing and Measuring the Performance of Your Organisation

• Converting the financial data into information and reveal business situation and prospects
• Using financial ratios to benchmark and then drive performance
• Net Profit Margin - Short term liquidity ratios and long term solvency ratios
• Asset Turnover (Stock Turn, Receivable and Payable days)
• Return on Capital Employed (ROCE)
• Return on Invested Capital (ROIC)
• Return on Equity (ROE)
• Understand where financial information can mislead

Module 3: Demystifying the Distinctions between ‘Financial’ and ‘Economic’ profit: the beliefs

• Uncover the drivers of corporate value using a variety of models including an extended DuPont Model
• Analyse valuation and the link Value-based Management (VBM)
• Using valuation techniques to understand long term business unit and corporate value
• Review traditional valuation techniques such as net asset value, adjusted asset value, replacement asset value, price to earnings ratios (P/E), price to book (P/B), dividend valuation and EBITDA multiples

Module 4: Economic Value Added (EVA™)

• Understanding the language of corporate financial value
• Techniques for measuring corporate value
• Discounted cash flow and present value
• Calculation of annuities, perpetuities, expected returns and volatilities
• EVA™ – when is value-added?
• EVA™ and its relation to the DCF model
• Calculation of NOPAT and capital
• Typical adjustments for EVA™ calculation
• MVA as a discounted EVA™ concept
• Excel functions for financial calculations

Module 5: Capital Budgeting and Project Appraisal Techniques

• Methods of project appraisal: advantages and disadvantages
• Distinguishing investment decisions from financing decisions
• Sensitivity analysis, scenario analysis, data tables, etc
• Monte Carlo methods and relevance to capital budgeting
• Project Appraisal
• The capital investment process
• Present value, profitability indices, Discounted Cash Flows (DCFs) and timing of cash flows
• Net Present Value (NPV) and value-creating investment decisions
• Internal Rate of Return (IRR) and Modified IRR (MIRR) - Adjusted Present Value (APV) method – assessing the impact of risk on cash flow analysis
• Modified NPV – the real (or managerial or strategic) options approach to project appraisal - Mutually exclusive projects vs. independent projects