MS303:Accounting and Financial

Management
IIT Gandhinagar,
Sem II (Spring Semester), Academic Year 2019-20

rajiv.bhatt@gmail.com
 Course objectives
• Appreciate linkages of accounting and finance functions across business
operations
• Analyse financial statements of corporations. Critically evaluate financial
and non-financial information
• Understand links between accounting statements, valuation methods and
investment analysis.
• Understanding and applying discounted cash flow analysis to value
projects, including effect of gearing, estimation of the cost of capital, and
assessment of the credibility of a valuation.
• Understanding of currency risk and interest-rate risk, and the use of
financial products to manage these risks.
• Perform financial analysis, macro-economic analysis, and modelling for
making investment decision
• Gain understanding of M&A, PE, VC
• Team work
 Indicative course outline
Topic
Accounting as an information system. Power of information!
Interdisciplinary perspective of Accounting, Users of info
1 Static or Dynamic?
Accounting Mechanics: Journals, Ledger, Trial Balance, Profit & Loss and Balance Sheet
2
Analysis of financial statements – Quantitative (e.g. Ratio Analysis) and Qualitative (MD&A, Tripple bottom-
3 line/Integrated reporting), Use in forecasting, valuation etc.
4 Introduction to costing – cost behavior - transfer pricing
5 Marginal costing including break even analysis
6 Standard costing and variance analysis and budgetary control
Introduction to financial engineering
7
8 Capital Structure: Sources of long- term funds- equity (own, VC, PE, IPO) and bonds and their valuation
Capital Budgeting: Methods of project evaluation – payback period, accounting rate of return, net present value,
9 benefit cost ratio, internal rate of return

Portfolio Theory: Risk – Return Analysis : portfolio theory and capital assets pricing model. Computing WACC
10
Introduction to interest rates, exchange rates and derivative instruments
11
Corporate regorganizations/restructing: Mergers, acquisitions, divestments
12
13 Final Group Project

Indicative Assessment: Tutorials/Assignments/Quizzes: 20%, mid-sem project/exam: 20%, Final

Project: 60%
 References
Course Texts:
• Bhattacharyya S.K., Dearden John, Accounting for Management (Text & Cases), Vikas Publication
• Pandey, I. M, Financial Management, Vikas Publication

Reference books:
Accounting and Financial Statement analysis:
• Philip O'Regan, Financial Information Analysis, 2nd edition. Publisher: Routledge, ISBN: 9780415695855
• Peter Atrill & Eddie McLaney, Accounting and Finance for Non-Specialists, 10th edition. Publisher: Pearson, ISBN:
9781292135601
Financial Management/Corporate Finance:
• Brealey, R.A., Myers, S.C & Allen, F., Principles of Corporate Finance, 12th edition, 2017, McGraw-Hill
• Hillier, D. et al., (2014) Corporate Finance, 2nd European Edition, New York: McGraw-Hill Education
• Damodaran, A. (2015) Applied Corporate Finance, 5th Edition, New York, John Wiley & Sons Ltd.

Supplement reading:
• Economic times, Financial Times, Business Standards, Financial Express
• Framework / principles of Accounting Standards : ICAI https://resource.cdn.icai.org/23732frameworkIndAS.pdf
• Annual Report of Symphony Ltd. FY 18-19
• Academic papers – to be shared
 Note
• Learning will primarily be through reading,
thinking , class discussions, attending lectures
and working as groups on tutorials/projects.
• Accounting concepts can take time to absorb
and student should expect to have to invest
time prior to lectures in order to fully
understand and participate in class
discussions.