NATIONAL TEXTILE UNIVERSITY

FACULTY OF MANAGEMENT SCIENCES

“Financial Management”

Course Specifications

Fall 2018

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 COURSE SPECIFICATIONS

Basic Information

Course Title: Financial Management

Course Code: FIN 3083

Course credits/week: Theory :(3 ,0,) Lab: Nil Total: 3
Pre-requisite(s):
Co-requisite(s): Nil
Program(s) on which the course is given: BS (TMM)
Is the course major or minor element of the program: Major: Minor:
Department offering the program: Department of Business Administration
Department offering the course: Department of Business Administration
Academic year/level:
Revision #: 00
Last revised on (date): 20-09-2018

Overall Aims of the Course

Firms invest in real assets such as plant and equipment (the Investment decision) and raise money
via personal funds, stocks, bonds or bank loans (the Financing decision). Financial Management
is about how these Investments and financing decisions should be made. This course explores the
first part of Financial Management and introduces the framework, tools and techniques for
making Investment decisions. . Objectives of this course are
 To give students a comprehensive understanding of financial system that
how financial institutions mobilize funds through financial securities
 To equip students with techniques required to evaluate a project financially
 To equip students with skills required to efficiently control working capital

Course Schedule
Week Module Intended Learning Outcomes
1.Financial Management – An introduction
Review of Business Finance
Financial decision making
Financial management
Advance Problems of Time Value of Money
1

2 2. Capital Budgeting and Estimation of Cash Flows

Generating Investment Proposals
Estimation of After Tax Incremental Operating Cash Flows
Review of Capital Budgeting Process

3 Review of Techniques of Capital Budgeting

Potential difficulties
Multiple IRR
Problems and Exercises

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 Quiz

4 3. Bonds and Their Valuation

The basic of value
Characteristics of bonds
Different terms used in bond valuation
Types of Bonds
Bonds Valuation
Exercises and Problems
5 4. Stocks and Their Valuation
Common stock
Growth models of common stock valuation
Characteristics of common stock
Preferred stock
Valuation of Preferred stock
Exercises and Problems
Quiz
6 5. Risk and Return
Defining Risk and Return
Probability Distribution to measure Risk
Risk and Return in Portfolio context
7 Diversification
The CAPM
Exercises and Problems
8 6. Cost Of Capital
The purpose of cost of capital
Cost of capital concepts
Calculating the WACC
Mid Semester Examination
9 The marginal cost of capital
Exercises and Problems
Quiz
10 7. Operating and Financial Leverage
Financial leverage
Operating leverage
11 Total Leverage
Cash Flow ability to service debt
Problems and Exercises
12 8. Capital Structure Decisions
The target Capital Structure
Business and Financial Risk
13 Determining Optimal Capital Structure
Problems and Exercises
14 9. Dividend Policy
Passive vs Active Dividend policies
Factors influencing dividend policy
Dividend stability
15 Stock Dividend and stock splits
Stock repurchase
Problems and Exercises
Merger and Other Forms of Corporate Restructuring
Mergers and acquisition
Rationale for Mergers
Types of Merger
Hostile and Friendly Takeover
Leverage buyouts (LBOs) and proxy fights
Problems and Exercises

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16 10. Short Term Financing
Spontaneous Financing
Negotiated Financing
Factoring Accounts Receivables
Short Term Financing composition
Advantages and Disadvantages of Short Term Financing
Problems and Exercises

Teaching and Learning Methods

-Answer question session

-Interaction
-Examples

Required Learning Resources

Text Book(s):
(Title, Author, Edition, Publisher)
Reference Book(s):
(Title, Author, Edition, Publisher)
Van Horne, James C and John M. Wachowicz Jr, Fundamentals of Financial
Management,
12th edition, Prentice Hall Inc, New Jersey
Lawrence J. Gitman, Principles of Managerial Finance, 11 th Edition, Pearson India,
2009

Websites:

Facilities Required for Teaching and Learning

-Board and board marker
-Eraser
-Multimedia projector and display screens
-Air conditioned room
-Neat and clean seating arrangement

Assignments Schedule Quiz Schedule

No. Week Assigned Week Due No. Week
1 3 5 1 3
2 4 7 2 5
3 8 11 3 9
4 12 14 4 13
5
6

Weighting of Assessments
Quizzes/Viva/Presentation 15 %
Assignments 15 %
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Mid-semester examination 30 %
End-semester examination 40 %

Grading Criteria
Letter Grade Percentage Marks
A 85 %
B+ 80~84.99 %
B 75~79.99 %
C+ 70~74.99 %
C 65~69.99 %
D+ 60~64.99 %
D 50~59.99 %
F

Course Specifications Developed By: Reviewed By (Chairman):

Zafar Iqbal Dr. Sajjad Baig
Date: 20-09-2018 Date:

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