Concepts of Financial Management PPT

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Chapter 6 to 10

Chapter 6: Financial Statement Analysis

  • Understand the purpose of basic financial statements and their contents.
  • Explain why financial statement analysis is important to the firm and to outside suppliers of capital.
  • Define, calculate, and categorize (according to liquidity, financial leverage, coverage, activity, and profitability) the major financial ratios and understand what they can tell us about the firm.
  • Define, calculate, and discuss a firm’s operating cycle and cash cycle.
  • Use ratios to analyze a firm’s health and then recommend reasonable alternative courses of action to improve the health of the firm.
  • Analyze a firm’s return on investment (i.e., “earning power”) and return on equity using a Du Pont approach.
  • Understand the limitations of financial ratio analysis.
  • Use trend analysis, common-size analysis, and index analysis to gain additional insights into a firm’s performance.
Chapter 7: Funds Analysis, Cash-Flow Analysis, and Financial Planning
  • Explain the difference between the flow of funds (sources and uses of funds) statement and the statement of cash flows – and understand the benefits of using each.
  • Define “funds, ” and identify sources and uses of funds.
  • Create a sources and uses of funds statement, make adjustments, and analyze the final results.
  • Describe the purpose and content of the statement of cash flows as well as implications that can be drawn from it.
  • Prepare a cash budget from forecasts of sales, receipts, and disbursements – and know why such a budget should be flexible.
  • Develop forecasted balance sheets and income statements.
  • Understand the importance of using probabilistic information in forecasting financial statements and evaluating a firm’s condition.
Chapter 8: Overview of Working Capital Management
  • Explain how the definition of “working capital” differs between financial analysts and accountants.
  • Understand the two fundamental decision issues in working capital management – and the trade-offs involved in making these decisions.
  • Discuss how to determine the optimal level of current assets.
  • Describe the relationship between profitability, liquidity, and risk in the management of working capital.
  • Explain how to classify working capital according to its “components” and according to “time” (i.e., either permanent or temporary).
  • Describe the hedging (maturity matching) approach to financing and the advantages/disadvantages of short- versus long-term financing.
  • Explain how the financial manager combines the current asset decision with the liability structure decision.
Chapter 9: Cash and Marketable Securities Management

SRM's diversifying into FE, Int'l Econ, and IM

2007-12-02 05:45:52 by kidsuper

SRM's broadening its academic position in risk to include Financial Engineering, International Economics and Investment Management. All three of these areas will have designated MS and MBA (specialization) degree concentration(s) when their respective programs are established. SRM's recruiter base in insurance and risk is pretty steep, considering that the school retains all the networked goodwill of the former College of Insurance. The new electives of the MRM appear to focus more on strategic decision-making in risk, while the more technical courses are concentrating a bit more on advanced concepts in insurance

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