Financial Management

National Institute of Business Management

Chennai - 020

FIRST SEMESTER EMBA/ MBA

Subject : Financial Management

Attend any 4 questions. Each question carries 25 marks

(Each answer should be of minimum 2 pages / of 300 words)

1. Explain the Indian Financial Systems.

2. Explain debentures as instruments for raising long-term debt capital.

3. What is Working Capital Cycle?Discuss.

4. What are the characteristics and uses of ratio analysis? Explain with examples.

5. Explain how will you estimate cash flows.

6. Explain Performance Budgeting.

25 x 4=100 marks

ANSWERS

1. The Indian Financial Systems

Financial System of any country consists of financial markets, financial intermediation and financial instruments or financial products. This paper discusses the meaning of finance and Indian Financial System and focus on the financial markets, financial intermediaries and financial instruments. The brief review on various money market instruments are also covered in this study.

The term "finance" in our simple understanding it is perceived as equivalent to 'Money'. We read about Money and banking in Economics, about Monetary Theory and Practice and about "Public Finance". But finance exactly is not money, it is the source of providing FUNDS for a particular activity. Thus public finance does not mean the money with the Government, but it refers to sources of raising revenue for the activities and functions of a Government. Here some of the definitions of the word 'finance', both as a source and as an activity i.e. as a noun and a verb.

The American Heritage® Dictionary of the English Language, Fourth Edition defines the term as under-

1:"The science of the management of MONEY and other assets.";

2: "The management of money, banking, INVESTMENTS, and credit. ";

3: "finances Monetary resources; FUNDS, especially those of a government or corporate body"...