Summary
Summary FIN2603 EXAMPACK 2024
- Course
- Institution
FIN2603 EXAMPACK 2024
[Show more]
Seller
Follow
sfisomaseko
Reviews received
Content preview
Knowledge to empower your oppotunitiesFIN2603 Examination Preparation Pack
YEAR 2023
Prepared by Seko TUTORIALS
CALL 0787486410 FOR ANY ASSISTANCE/LESSONS
Pack Includes
• Summarised notes
• Questions from past papers and solutions
• Simulations
• Assignments questions
Introduction to managerial Finance
Financial Management for Non Financial Managers
• It refers to the art and science of managing money in an organisation.
Goal of Financial Management
• The main or prime goal of financial management is to maximise the shareholders wealth ,
measured by Share price NOT Earnings per share(profit maximisation).
Page 1
, Knowledge to empower your oppotunities
Agency Relationship
• Refers to the association of the Shareholders (principal ) and the agencies(management), the
link of the two is based on the goal of financial management.
• The agency is employed to make sure that during his tenure as the management , share
prices increased.
Agency Problem
• This is the conflict between the agencies(management ) and the principal (shareholders), the
conflicts arises when the agencies pursues personal goals at the expense of the shareholders
(goal of financial management)
• When managers sacrifices their main responsibilities of maximising shareholders, and
pursue other goals that enriches them, then the agency problem will arises as shareholders
tries to align the agencies to their main function
Agency costs
• This refers to the expenditure incurred when the principal tries to mitigate the losses as a
result of the agency problem. This includes costs incurred on the following
Monitoring and compliance(audit) costs to make sure that the agency
does not abuse the opportunities and funds
Bonus shares and incentives paid to agencies as a motivational tool
Target incentives
Social Corporate Responsibility
• This refers to the voluntary investing in non profit projects that benefits the society. Such
activities enhances the corporate image of the entity and this increase the shareholders
wealth in the long run
Corporate Governance
• This refers to the way things are supposed to be done, it refers to the policies , norms,
standards and policies that are perceived by an entity and has to be strictly followed as the
defines the entity.
Functions of a Financial Manager
• Acquisition of finance
• Goal of Financial management
• Investing decisions
• Capital Budgeting
Page 2
, Knowledge to empower your oppotunities
• Accounting duties
• Treasury of the entity
• Overseer the accounting department
Financial Markets
• Refers to a locus where buyers and sellers of funds, capital, financial instruments are traded
We have categories of Financial Markets called
o Secondary vs Primary Market
A primary market is a financial market where securities are initial traded, and a
Secondary market is a market where pre –owned securities are traded
o Money and Capital Market
A money market is a financial market where a short term financial securities are
traded whereas a Capital Market is a market where longterm financial securities
are traded eg , JSE, BESA , Bank ,
Business Units
Sole Trader
Partnerhsip Learners Activities, find out about the features, benefits and disadvantages
Private
Limited
Public
Limited
Examination Questions and Solutions
May/June 2012
Page 3
, Knowledge to empower your oppotunities
Solution
Question 1 2
Question 2 3
Question 3 4
Question 4 3
Question 5 4
October/November 2010
Page 4
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller sfisomaseko. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $8.00. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
76669 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now