ANDHRA PRADESH STATE COUNCIL OF HIGHER EDUCATION

MINOR

Subject: FINANCE (For Commerce and Other Majors)

w.e.f. AY 2023-24 Onwards

COURSE STRUCTURE

FINANCE MINORS
(For Commerce and Other Majors)
Course No of Hrs / No of
Semester Course Name
Number week Credits
II 1 Financial Services 4 4
III 2 Financial Markets 4 4
IV 3 Financial Management 4 4
4 Investment Management 4 4
V 5 Financial Reporting 4 4
6 Security Analysis and Portfolio Management 4 4
 SEMESTER – II

Course 1: FINANCIAL SERVICES

Theory Credits: 4 4 hrs/ week

Learning Objectives:
The course provides a complete package of finance and financial service es related subjects so that the
students are well equipped with the functional aspects of the various types of financial products and services
available in our country.

Learning Outcomes:
At the end of the course, the student will be able to understand the world of financial services and to
facilitate the understanding of the various Financial Services. The course covers Merchant banking
services, credit rating, leasing and Hire purchases. The students able to understand other financial services
like factoring and forfaiting procedural aspects.

Unit 1: Financial Services:

Role of Financial Services - Banking and Non Banking Companies – Activities of Non Banking Finance
Companies- Fund Based Activities - Fee Based Activities .

Unit 2: Merchant Banking Services:

Scope and importance of merchant banking services - Venture Capital - Securitization - Demat services -
Commercial Paper.

Unit 3: Leasing and Hire-Purchase:

Types of Lease, Documentation and Legal aspects – Fixation of Rentals and Evaluation - Hire Purchasing-
Securitization of debts - House Finance.

Unit4: Credit Rating:

Purpose – Types – Credit Rating Symbols – Agencies: CRISIL and CARE – Equity Assessment vs.
Grading – Mutual funds.

Unit5: Other Financial Services:

Factoring and Forfeiting - Procedural and financial aspects - Installment System - Credit Cards - Central
Depository Systems: NSDL, CSDL.

Activities:
 Collection and study the various financial services
 Invited lectures on the field topics by local experts
 Introducing online classes from financial experts on merchant banking and leasing etc.
 Field visit to banks and financial institutions
 Observation, study and analysis of selected institutions
 Assignments, Group discussion, quiz etc.

Reference Books:

1. B. Santhanam, Financial Services, Margham Publication, Chennai. 2.M.Y. Khan, Financial Services,
Tata McGraw – Hill, New Delhi. 3. Machendra Raja, Financial Services, S.Chand Publishers, New Delhi.
4. V. A. Avdhani, Marketing of Financial Services.
5. Machiraji, “Indian Financial System”, Vikas Publishers.
6. Sandeep Goel, Financial Services, PHI Learning.
7. L.M. Bhole, Financial Institutions and Markets, Tata McGraw Hill.
8. SEBI Guidelines, Bharat Publications, New Delhi.
9. E. Gordon & H. Natarajan, Capital Market in India, Himalaya publishing House
 SEMESTER – III

Course 2: FINANCIAL MARKETS

Theory Credits: 4 4 hrs/ week

Learning Objectives:
The course provides a complete knowledge of finance and financial markets related subjects so that the
students are well equipped with the finance markets and capital markets in our country.

Learning Outcomes:
Learning Outcomes: After successful completion of this course, the students will be able to;
Acquire knowledge of financial terms and know the concepts relating to and markets and different avenues
of investment. Understand the career skills related to Stock Exchanges and comprehend the personal
financial planning and money market skills

Unit-I: Financial Markets: Financial Instruments - Intermediaries - Services - Structure of Financial

Market in India.

Unit-II: Capital Market: Role, Evolution in India - Future Trends - Primary Market - Issue of Capital:
Process, Pricing, Methods of Issue, Book-building - Managing Shareholders Relations.

Unit-III: Secondary Market: Growth, Development, Regulation - Stock Exchange Mechanism: Trading,
Settlement - Carry Forward, Badla system - Insider Trading, Price Rigging.

Unit-IV: Players on Stock Exchange: Investors, Speculators, Market Makers, Bulls, Bears, Stags - Stock
Exchange Regulations - Stock Indices - Regulations and Regulatory Agencies (SEBI).

Unit-V: Bond Market in India: Bond Market and its Interface with Equity Market and Debt Market -
Mutual Funds.

Activities:
 Collection and study of pamphlets, application forms etc.
 Invited lectures on the field topics by local experts
 Introducing online classes from NSE
 Field visit to mutual fund offices /share brokers
 Observation, study and analysis of selected companies share prices
 Assignments, Group discussion, quiz etc.

Reference Books:
1. Gupta, L.C: Stock Exchange Trading in India; Society for Capital Market Research and
Development, Delhi.
2. Bhole, I.M., Financial Institutions and Market, Tata McGraw Hill.
3. Vasant Desai, Indian Financial System, Himalaya Publishing House.
4. Pathak, Bharati V., Indian Financial System: Markets, Institutions and Services, Pearson
Education (Singapore), New Delhi.
5. Gordon E. & K. Natarajan, “Financial Markets and Services”, Himalaya Publishing House,
New Delhi.
 SEMESTER – IV

Course 3: FINANCIAL MANAGEMENT

Theory Credits: 4 4 hrs/ week

Learning Objectives:
1. To appreciate the role of the finance in an organization and to identify sources from where funds can be
raised keeping in mind the cost and risk involved.
2 To familiarize the students the techniques to be employed for investing the funds and help the students
to understand the application of tools and techniques of Financial Management.

Learning Outcomes:
Understand the fundamental concepts, objectives, and functions of financial management and Sources of
finance for establishing business proposal and apply the theories of capital structure and concepts of
designing capital structure of a firm. Apply the mechanism of dividend policies and decisions, Analyse the
concepts and process of working capital and understand the methods of capital budgeting and the principles
of investment decisions

Unit I: Nature of Financial Management:

Meaning and scope of finance function - Goals of financial management - Profit maximization - Wealth
maximization - Importance of financial management. Financial Planning and forecasting - Factors affecting
financial planning.

Unit II: Capital structure:

Meaning of capital structure – Factors influencing capital structure – optimum capital structure –
computation and analysis of Earning Before Interest and Tax (EBIT), Earning Before Tax (EBT), Earning
Per Share (EPS).

Unit III: Cost of Capital:

Concept: - Importance and types of cost of capital - Measurement of cost of capital - Weighted average
cost of capital - Operating and financial leverages.

Unit IV: Capital Budgeting:

Capital Budgeting Process –Project Appraisal techniques –Selection Process under Capital Rationing

Unit V: Working capital management:

Concept of working capital - liquidity vs. Profitability- Need and importance of working capital.
Determinants of working capital- Components of working capital - Computation of working capital.

Activities:
 Compute cost of capital and develop innovative financial strategies.
 Analyze the capital structure decisions through relevant models.
 Discuss the dividend policy of a firm.
 Quiz programs and Seminars
 Guest lectures on various topics by Financial Managers
 Observing working capital management of a firm and report.
 Group Discussions on problems relating to topics covered by syllabus
 Conducting the project on selection process in an organization
 Examinations (Scheduled and surprise tests)
Reference Books:

1. M.Y.Khan and P.K.Jain, (2007), Financial Management, Tata McGraw Hill, New Delhi.
2. Saxena and C.D.Vashist, Essentials of Financial Management (2010), Sultan Chand and Sons,
3. Brealey and Mysers, (1985), Principles of Corporate Finance, Tata McGraw Hill, New Delhi.
4. Prasanna Chandra, (2008), Financial Management Theory and Practice - Tata McGraw Hill,
5. T.S. Reddy & Y. Hari Prasad &Reddy(2013), Financial Management, Margham Publications, Chennai.

SEMESTER – IV
Course 4: INVESTMENT MANAGEMENT

Theory Credits: 4 4 hrs/ week

Course objectives:
Understand different investment alternatives in the market • Understand how securities are traded in the
market • Be able to analyze and price different securities • Be able to manage a portfolio • Understand
basics in derivative

Learning Outcomes:
 The course introduces the concepts of investment.
 The course aims to give investment planning decisions and modern investment alternatives.
 Different topics such as risks and valuation of investment are to be discussed.
 In this course, we will also examine the time value of money, equity and bond valuation.
 The other important topics discussed in this course are primary and secondary market and
fundamental analysis of the investment.

Syllabus:
Unit I: Investment:
Investment – Primary and Secondary Objectives – Investment vs. Speculation- Investment Process –
Investment Information- Personal financial planning – Risk Profiling.

Unit II: Investment Risk:

Systematic & Unsystematic risks – Calculation of risk – Probability & Non-probability risks – Investment
Return – Capital and Revenue Return – Calculation of Returns.

Unit III: Investments:

Bank deposits, post office savings scheme, NBFC deposits, Gold and silver, Real Estate, Equity shares,
Bonds and Government securities, Mutual funds, life insurance, Tax Savings, Derivatives & Modern
Investment alternatives.

Unit IV: Time value of Money:

Time value of Money – Present Value Interest Factor - Present Value Interest Factor Annuity - Future
Value Interest Factor - Future Value Interest Factor Annuity – Equity Valuation – Bond Valuation – Yield
to Maturity – Problems in Valuation of Investment.

Unit V: Primary vs. Secondary Market:

Primary vs. Secondary Market Fundamental Analysis – Economic Analysis – Industry Analysis –
Company Analysis – Financial Analysis

Practical Components
 Students should learn the basics of investment and differences between investment and speculation.
 All the students should learn the systematic risk and unsystematic risk also how to calculate the
risks.
 Students should form into teams and prepare presentations on the topics in the syllabus and provide
them as assignments or seminars
 All the students should make teams should discussion different types of deposits.
 Students should analyse the concept of time value of money.
Reference Books
1. Rustagi R P, Investment Analysis & Portfolio Management, Sultan Chand & Sons, New Delhi.
2. Pandian Punithavathy Security Analysis & Portfolio Management, Vikas Publishers, New Delhi,
2010.
3. Chandra Prasanna, Investment & Portfolio Management, Tata McGraw-Hill, New Delhi, 2011
4. Natarajan, Investment Management, Margham Publishers, Chennai, 2012.

SEMESTER – V

Course 5: FINANCIAL REPORTING

Theory Credits: 4 4 hrs/ week

Course objectives:
To provide information about the financial position, performance and changes in financial position of an
enterprise that is useful to a wide range of users in making economic decisions.

Learning outcomes:
 To learn about introduction of financial reporting, concept, advantage and disadvantages also
objectives
 To understand the scope and modes of restricting competitive advantage
 To evaluate the consolidated financial statements of holding and subsidiary companies
 To gain knowledge on valuation of shares
 To gain knowledge on corporate financial accounting, new trends in accounting and accounting
standards.

Syllabus:

Unit I: Financial Reporting:

Concept, objectives, uses, purpose of financial reporting & specific purpose of report- difficulties in
corporate reporting – issues and problems with special reference to published financial statements.

Unit II: Corporate Restructuring:

Scope and modes of restructuring competitive advantage – various types corporate restructuring strategy.

Unit III: Consolidated Financial Statements of holding& subsidiary Companies:

Purposes of consolidated financial statements, Consolidation procedures–minority interests, Goodwill,
Treatment of pre-acquisition and post-acquisition profit- balance sheet.

Unit IV: Valuation of Shares:

Need for valuation of shares, factors effecting value of shares - methods of valuation of shares: valuation
of goodwill: need and methods – normal profit method, super profit method, and capitalization method.

Unit V: Corporate Financial Accounting:

Objectives scope role of corporate accountant, analysis & interpretation of financial statements, accounting
standards. New trend in accounting: human resources accounting, environmental accounting, social
responsibility accounting (Theory only).

Practical components
 Students should learn the concept of objectives of financial reporting with reference to published
financial statements
 Analyse the scope and modes of various types of corporate restructuring strategy with real
environment.
 Students should form into teams and prepare presentations on the topics in the syllabus and provide
them as assignments or seminars
 All the students should make collect information regarding different top companies who have
subsidiary companies.
 Students should analyse the overview of valuation of shares.
Reference Books
1. R.S.N. Pillai, Bagarathi& Suma, Fundamentals of Advanced Accounting, Vol1, S Chand, New
Delhi.
2. Nehru J. Financial Reporting by diversified companies vision Books, New Delhi.
3. Hawkins David Financial Statements corporations Dow Jones-Irwin Homewood1973.
4. S.P Jain & K.L Narang, Corporate accounting, Kalyani publishers.
5. S.P Jain & K.L Narang, Advanced corporate accounting, Kalyani publishers

SEMESTER – V

Course 6: SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT

Theory Credits: 4 4 hrs/ week

Course objective:
To enlighten the students with the Concepts and Practical applications of Measure risk and return of
different security instruments and portfolio.

Learning outcomes:
After completion of the course, the student is able to
 Understand the various forms of investment, security Markets and other concepts.
 Understand risks associated with investment.
 Measure risk and return of different security instruments and portfolio.
 Analyse the fundamental strength of stocks and predict the price trends of securitiesusing technical
analysis and valuation of stocks and fixed income securities.
 Evaluate the performance of portfolio.

Syllabus:

Unit I: Concept of Investment:

Objectives – Investment Vs Speculation – Security InvestmentVs Non-security Forms of Investment –
Investment Process – Sources of Investment Information –Security Markets – Primary and Secondary –
Market Indices.

Unit II: Return and Risk:

Meaning and Measurement of Security Returns – Types of SecurityRisks – Systematic Vs Non-systematic
Risk – Measurement of Total Risk.

Unit III: Fundamental Analysis of Stocks:

Economy, Industry and Company Analysis,Intrinsic Value –Approach to Valuation of Bonds, Preference
Shares and Equity Shares.

Unit IV: Technical Analysis:

Concept and Tools of Technical Analysis – Technical AnalysisVs Fundamental Analysis – Efficient
Market Hypothesis – Concept and Forms of MarketEfficiency.

Unit V: Elements of Portfolio Management:

Portfolio Models – Markowitz Model, EfficientFrontier, Sharpe Single Index Model and Capital Asset
Pricing Model – Performance Evaluation ofPortfolios – Sharpe Model, Treynor model – Jensen’s Model
for PF Evaluation – Portfolio Revision.

Practical components
 Students should learn the concept of investment also differences between investment and
speculation, sources of investment information.
 Analyse the measurement of security returns and types of security risks.
 Students should form into teams and prepare presentations on the topics in the syllabus and provide
them as assignments or seminars
 All the students shouldcollect information regarding concept and forms of market efficiency
 Students should analyse the elements of portfolio management.
Reference Books:
1. Fisher and Jordan, Security Analysis & Portfolio Management 6e, (2011) Pearson, PHI.
2. S. Kevin, Security Analysis & Portfolio Management, 2e (2015) Prentice Hall India.
3. Avadhani VA, Securities Analysis & Portfolio Management, 9e (2017) Himalaya Publishing
House.
4. Prasanna Chandra, Investment Analysis and Portfolio Management 3e, (2011) Tata McGraw-Hill
Education
5. P. Pandian, Security Analysis and Portfolio Management, 1e (2014), Vikas Publishing House Pvt.
Limited.