Importance of MBA FinanceMBA finance professionals assess feasibility of business projects according to funds available. Explore strategies to raise money and plan new areas for investment.
MBA finance professionals have good reasoning ability with problem solving skill which gives them ability to make and implement correct financial decisions. The accounting manager is focused more on financial reporting, while the financial manager is focused on strategy and money management. Cash management strategies developed and implemented by the financial analyst help the company to grow efficiently and allow for maximum profitability in its investments.
Course Contents for MBA Finance
- Financial Management – Meaning and Objectives, A’s of Financial Management, Scope and Functions of Financial Management, Financial Planning and Forecasting.
- Capitalization – Under and Over Capitalization, Capital Structures – Computation of cost of capital, Trading on Equity, Leverages – Type and Significance
- Capital Budgeting – Nature and Significance, Time value of money- Discounting and Compounding – Methods of evaluating Capital Expenditure proposals. Analysis and interpretation of Financial Statements using the techniques of Ratio Analysis and Fund Flow analysis.
- Working Capital Management – Nature of Working Capital Management, Need for working capital – operating cycle, estimation of working capital requirement – Management of Cash and Receivables, Cash Budget.
- Management of Profits-Dividend Policy, Procedural and Legal formalities involved in the payment of dividend-Bonus Shares.
- Advanced Financial Management - Accounting Standards, Capital Structure Theories, Dividend Distribution Theories, Capital Budgeting, Economic Value Added (EVA) and Financial Analysis using tools such as Cash Flow and Fund Flow.
- The Finance function : Nature and Scope. Evolution of finance function – The new role in the contemporary scenario – Goals of finance function – maximizing vs. satisfying (School); Profit vs. Wealth Vs. Welfare ; the agency relationship and costs – The new debate on maximizing – Vs- satisficing. Wealth maximization and Risk-Return trade off.
- The Investment Decision: Investment decision process- Project generation, project evaluation, project selection and project implementation. Developing Cash Flow Data. Using Evaluation Techniques – Traditional and DCF methods. The NPV vs. IRR Debate. Approaches for reconciliation. Capital budgeting decision under conditions of risk and uncertainty; Measurement of Risk – Risk adjusted Discount Rate, Certainty Equivalents and Beta Coefficients , Probability tree approach – Sensitivity analysis.
- The Financing Decision: Sources of finance – a brief survey of financial instruments. Concept and financial effects of leverage. The capital structure decision in practice: EBIT – EPS analysis. Cost of Capital: The concept – Average vs. Marginal Cost of Capital. Measurement of Cost of Capital – Component Costs and Weighted Average Cost. The Dividend Decision: Major forms of dividends – Cash and Bonus shares. The theoretical backdrop – Dividends and valuation; Major theories centered on the works of Gordon, Walter and Lintner – The basic dividend theorems for valuation. Dividend policies of Indian Companies.
- Current Assets Management : Concepts and characteristics of working capital. Factors determining the working capital. Estimating working capital requirements. Working capital policy. Management of current assets – Cash, Receivables and Inventory. Cash budget, Receivables policy, Credit terms – Financing current assets – Customers credit. Short term bank finance – Bank norms for working – Capital financing.
- Corporate Restructures: Corporate Mergers and acquisitions and take-overs – Types of Mergers – Economic rationale for Mergers, motives for mergers, Financial Evaluation of Mergers – different approaches for valuation.. Corporate Value based management systems – Approaches – Principles of good corporate Governance.
- Advance Financial Services - Overview of Indian Financial System, Capital Market, Secondary Markets - Stocks Exchanges in India, Money Market and Credit rating
- Banking and financial Institutions -Developments since 1991 -Types of bank -Instruments, Study of various interest rates, RBI-Role played, Commercial Banking and Non-Banking Financial Companies.
- Security Analysis & Portfolio Management - Investment Scenario, Risk and Return, Security Market Indicators, Equity stock valuation models, Bond valuation, Efficient market hypothesis, Emerging trend of Security Analysis in global market, Portfolio analysis and portfolio selection and Personal Financial Management
- Risk and Insurance Management - Introduction to Risk Management, Instruments of External techniques of Risk Management, Life Insurance General Insurance and Legal framework and documentation
- Strategic Financial Management and Cost Management
- International Financial Management - Foreign Exchange Markets, Multinational Banking Market Efficiency, Foreign Direct Investment and Capital market theory in International context.
Books for MBA Finance
- Financial Management – I.M.Pandey
- Financial Management – Khan & Jain
- Financial Institutions & Markets- L.M. Bhole
- Indian Financial System- M.Y.Khan
- Indian Financial System- H.R. Machiraju
- Levi, Maurice. International Finance
- Richard A Brealey et al., 2007, Principles of Corporate Finance, Tata McGraw Hill
- Gitman.L.J., 2006, Managerial Finance, 11th Edition, Pearson Education.
- Brigham, E.F. and Ehrhardt.M.C.,2006 , Financial Management Theory and Practice, 10th Edition, Thomson South-Western.
- Vishwanath.S.R., 2007, Corporate Finance: Theory and Practice, 2nd Edition, Response books, Sage Publications.
- Bruner.R.F.,2007, Case Studies in Finance, 5th Edition, Tata McGraw Hill, New Delhi-8.
- Prasanna Chandra, 2006, Financial Management Theory and Practice, 6th Edition, Tata McGraw Hill.
- I.M. Pandey : Financial Management, Vikas Publishers.
Jobs for MBA FinanceMBA finance professionals get employment in investment banks, corporations, and securities firms. Some of the top financial job responsibilities held by MBA finance are -
- Financial Analysts and planner
- Corporate Controllers
- Chief Financial Officers (CFO)
- Risk and Insurance Managers
- Investment Banking Associates
- Investment Sales Associates and Traders
- Credit Managers
- portfolio manager
- financial reporting analyst
- international controlle
- mutual fund analyst
- director of investor relations
- procurement specialist