Essentials of financial management / I. M. Pandey

Includes index.

Part 1. Introduction -- 1. Financial management : scope and objectives -- 2. Sources of long-term finance -- Part 2. Concepts of value -- 3. Time value of money -- 4. Valuation of of shares and debentures -- Part 3. Risk, return and capital asset pricing -- 5. Risk and return -- 6. Portfolio theory and CAPM -- 7. Beta estimation and the cost of equity -- Part 4. Cost of capital and capital budgeting -- 8. Cost of capital -- 9. Capital budgeting techniques -- 10. Cash flow estimation for investment evaluation -- 11. Risk analysis in capital budgeting -- Part 5: Financing decisions -- 12. Operating and financial leverages -- 13.Capital structure theory and practice -- 14. Dividend theory and practice -- Part 6. Working capital management -- 15. Nature of working capital -- 16. Cash management -- 17. Receivables management -- 18. Inventory management -- 19. Working capital finance -- Part 7: Financial planning -- 20. Financial statement analysis -- 21.Long-term financial planning.

This book is about financial analysis and funds management. The focus of the book is on understanding the financial decision-making and funds management. The book discusses concepts, assumptions, theories and mechanics underlying the important financial decisions - investment, financing, dividend and liquidity management. The basic purpose of the book is to assist the reader to develop a thorough understanding of the concepts and techniques underlying financial management in a systematic way. To accomplish this purpose, we have presented recent thinking in the most lucid, simple, unambiguous and precise manner. The book contains discussion of capital budgeting, capital structure and dividend policy and working capital management with a view that the reader understands these financial decisions thoroughly well and is able to evaluate their implications from the shareholders’ and the company’s points of view. Essentials of Financial Management stresses the analytical approach for solving financial problems. The process of financial decision-making has been explained step-by-step. The concepts are made clear in simple language before introducing complicated techniques. For a better and easy understanding of the concepts and techniques, the book contains illustrative problems, diagrams and real-life-like financial problems with suggested solutions. To quickly check concepts after every section, we have added short-answer questions. We have also given quizzes, review questions and problems at the end of each chapter. Questions and problems illustrate key points in the text. Some questions and problems require the reader to evaluate a situation or critically examine and analyse it. It is hoped that this will facilitate a better understanding of the subject matter. For a quick revision, each chapter contains summary and specifies key words. The book is meant for BBA, BBS, B Com (Hons) and B Com students and as well, to serve as a first level course for the students preparing for management, chartered accountancy, cost and management accountancy, certified financial analysts and company secretary examinations and AIMA’s Postgraduate Diploma in Management studies and other degree and diploma courses. The book will also be useful for financial executives who want to up-date their knowledge about the recent thinking in financial management and wish to improve their ability in making financial decisions. To cater to the needs of both students and financial executives, the subject matter in the book has been treated in a conceptual-cum-analytical manner. It is the aim of the book to help the reader develop skills to understand, analyse and interpret financial problems and data to make good financial decisions.