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` Finance is a life blood of
business.
` Finance is the most
encompassing of allbusiness enterprises. Ravi M. Kishore, Taxmann.
` The study of money and
other assets.` The art and science of
managing money. Wikipedia, the free encyclopedia
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` Finance is the study and practice
of making Rupee denominated
decisions. Dakota State University Madison, SD, USA
` The commercial activity of
providing funds and capital.
`
The branch of economics thatstudies the management of
money and other assets.
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` To obtain or provide money.
` To sell or provide on credit.
` The management of money
and credit and banking andinvestmentswordnet.princeton.edu/perl/webwn
` Web Results There are about
26,900,000links on - What is finance?
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` Management is an organizational function.
` Management is the act of directing andcontrolling a group of people for the purpose ofcoordinating and harmonizing the group towardsaccomplishing a goal beyond the scope of individual effort. en.wikipedia.org/wiki/Management
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` Management is the process of
getting activities completed
efficiently and effectively with
and through other people.
` Management means to get the
work done
` Web Results There are about 79,100,000links on What is management?
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` The study about the process of procuring and judicious use of financial resources with a view tomaximizing the value of the firm
thereby the value of the owner. Ravi M. Kishore, Taxmann.
` It is concern with duties of thefinancial managers in the
business firm. -Khan and Jain
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It is all about money, Honey!
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` How to eat money?
` How to drink money?
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` How to ware money?
` How to think money?
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How to see money?
How to talk money?
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How to walk with money?
How to sleep with or without money?
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` How to plan money?
` How to get money?
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` How to use money?
` How to risk money?
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` How to control money?
` How to run with or without money?
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Do business with
others money
Money brings
money
Dream money to
earn money
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The purpose of the Financial Management is to makesure that the money flows to those who value it thehighest.
(that is those who can put it to the "best" use).
Now
Corporations Households / Investors
(Need Money) Rs. (have money to invest)
Futu
reCorporations Households / Investors
(have money) Rs. (Want money back)
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` The role of the financial manager is central in the
flow ofmoney from investors into the firm and then
back to those same investors.
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To maximize the owners wealth.
How?..........
By maximization of profits.
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` How to maximize the owners wealth?
By maximizing the profits of the company
[in short term]
By increasing the shareholders worth[in long term]
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` How to maximize
profits?
Increasing sales
Decreasing cost
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Procurements of funds at
lowest cost possible.
Investment of funds forhighest returns.
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Control on use of funds.
Risk Return Trade off.
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` Mobilization of funds Financial decision
` Deployment of funds Investment decision
` Control over the use of funds Monitoring and
controlling
` Risk Return trade off Balancing - Debts Serving.
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` Treasury Operations Short term fund management and speculative gain by
anticipation interest rate movement.
` Foreign exchange rates Predicting future value of a currency.
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` Financial structuring Optimum mix between and equity.
` Maintaining share prices Appropriate dividend and bonus policies
` Ensuring management control Prevent dilution of management control
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` Role of a Finance Managerx Goal of finance manager
x Objectives of finance manager
x Functions of finance manager.
x Challenges to finance manager.
` Get details from: At least 5 Books and 10 web sites.
Or, Meet a finance manager of a public limited company and
discuss he/her role as a finance manager.
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Give the details of the books referred e.g. title, author, page
no. etc
Full web links [in case web search]
Visiting card of the finance manager with office phone
number [if role is discussed by meeting a Fin. Manager]` Date of Submission :
Jan. 2012,
by 4 pm.
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` Finance is pervasive, all-encompassing,
omnipresent, persistent, insidious and invasive innature.
` It is directly or indirectly present in all function and
areas of business.
` It is a common thread passing through all andnetting every thing in business.
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` Forms of Business Organization Sole proprietorship
x One man army [unlimited liability]
Partnership
x 2 or more with [unlimited liability]
Company
x Ownership and management is in
different hands [unlimited liability]
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The Companies (Amendment) Act, 2006 Amendment ofsection 253- "Provided that no company shall
appoint or re-appoint any individual as director of the company
unless he has been allotted a Director Identification Number
under section 266B.
Why ?
Because. The provisions of the Companies Act, allow an individual to be a
director of up to fifteen companies. There is a need for identity of
person(s) intending to be directors of companies to beestablished, to facilitate effective legal action against the directors
of such companies.
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` Companies in the UK must include certain
regulatory information on their websites and in
their email footers or they will breach the
Companies Act and risk a fine.Why?
Because
` To avoid having to decide whether each email
amounts to a 'business letter' or not.
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` Regulatory Framework Industrial Policy
Industrial Licensing Provisions and Procedures
Regulations of foreign collaboration and investments
FEMA
Company Act
SEBI
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Industrial Policy
x Industrial policy 1956
x Industrial Licensing policy 1973
x Industrial Policy Statement resolutionWhy a Finance manager should
have knowledge about these
policies and provisions?
These provisions defines the investment
avenues open to the enterprise.
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` Resent Developments Abolition of licensing requirements
Raising of investment ceilings for SSI
Permitting the private sector to telecom equp.
manufacturing. Encouraging foreign investments in the equity of our
co.
Encouraging foreign equity to manufacture computers.
Disinvestment in selected PSU
x www.dipp.nic.in [up dates up to 9/5/2008]
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` Industrial Licensing, Provisions and Procedures
[underIDRA]
` Industries reserved for public sector.
` Industries subject to Compulsory licensing.
` Products reserved for SSI[not exceeding 5 crore]
` Ancillary units [sell > 50% of the products to Industries]
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` Industrial Licensing is abolished for all projects except for
industries related to:
` Security and strategic concerns for social reasons
` Hazardous chemicals for environmental reasons` Items of elitist consumption
` Central Advisory Council to represent the interest of owners,employees and consumers
` Development Council to increase the efficiency or productivityin terms of economy and interest of the community.
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` Regulations of foreign collaboration and
investments` FEMA-The object of the Act is to consolidate and amend the
law relating to foreign exchange with the objective of
facilitating external trade and payments and for promoting theorderly development and maintenance of foreign exchange
market in India.
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` Regulations of foreign collaboration and
investments The Securities and Exchange Board of India was
established on April 12, 1992 in accordance with the
provisions of the Securities and Exchange Board ofIndiaAct, 1992.
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The Preamble of the SEBI describes the basic functions:
..to protect the interests of investors in
securities and to promote the development of, and
to regulate the securities market and for matters
connected therewith or incidental thereto
http://www.sebi.gov.in/Index.jsp
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` Financial System [chapter 2] http://finance.wharton.upenn.edu/~allenf/download/Vita/ind
ias%20financial%20system.pdf
` Authors Franklin Allen -Finance Department, The Wharton
School, University ofPennsylvania
Rajesh Chakrabarti -Finance Area, Indian School of
Business, Hyderabad 500 032, India
Sankar De- Centre for Analytical Finance, IndianSchool of Business, Hyderabad 500 032, India
x Submitted on October 27, 2007
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` Tax Aspects Direct taxes Income tax, wealth tax, gift tax etc.
Indirect taxes sales tax, excise, custom, service etc.
Finance Act 2008
http://incometaxindia.gov.in/