184153241 ADL 13 Financial Management V
Financial Management
Assignment - A
Question 1a: Should the titles of controller and treasurer be adopted under
Indian context? Would you like to modify their functions in view of the company practice in India? Justify your opinion?
Answer to 1a:
Controller & Treasurer are independent & they have their own Perspectives & Drivers as detailed below:
Controller
Responsibilities include, Double entry accounting, financial reporting, Fraud measure, detective controls, Financial restatement,
Compliance with statutory requirements like
Rules, Accounting standards, GAAP, IFRS etc.,
Controller works & forecasts the events for a long term. Main focus – income statement
Ex: Cash involved event
Controller looks from compliance angle (how to record, what GAAP provides etc.,)
Treasurer
Responsible for Liquidity management (very important function), Risk Management, More focus on financial statements, follows leading practices & responsible for the future performance of company (projects cash flows)
Treasurer works/ forecasts the events regularly
(daily / weekly) – focus – Balance sheet & future capital structure, capital expenditure etc.,
Treasurer concentrates more on cash availability focus – i.e. how to bring in the required cash etc,
Therefore, from the above it is clear that, controller & treasurer have different roles to play. However, majority of the Indian companies works with Financial Controller who himself takes care of the treasury department / Portfolio.
Therefore, as far as from Indian context, it can be concluded that, controller is also responsible for treasury jobs & there is no separate treasurer / treasury department exists
Question 1b: firm purchases a machinery for Rs. 8, 00,000 by making a down payment of Rs.1,50,000 and remainder in equal installments of Rs. 1,50,000 for six years. What is the rate of interest to the firm?
Answer to Q1b:
Particulars
Cost of Machinery
Down Payment made by firm
Financed through borrowings Ref
Year 0
(a)
800,000
(b)
c
Assignment - A
Question 1a: Should the titles of controller and treasurer be adopted under
Indian context? Would you like to modify their functions in view of the company practice in India? Justify your opinion?
Answer to 1a:
Controller & Treasurer are independent & they have their own Perspectives & Drivers as detailed below:
Controller
Responsibilities include, Double entry accounting, financial reporting, Fraud measure, detective controls, Financial restatement,
Compliance with statutory requirements like
Rules, Accounting standards, GAAP, IFRS etc.,
Controller works & forecasts the events for a long term. Main focus – income statement
Ex: Cash involved event
Controller looks from compliance angle (how to record, what GAAP provides etc.,)
Treasurer
Responsible for Liquidity management (very important function), Risk Management, More focus on financial statements, follows leading practices & responsible for the future performance of company (projects cash flows)
Treasurer works/ forecasts the events regularly
(daily / weekly) – focus – Balance sheet & future capital structure, capital expenditure etc.,
Treasurer concentrates more on cash availability focus – i.e. how to bring in the required cash etc,
Therefore, from the above it is clear that, controller & treasurer have different roles to play. However, majority of the Indian companies works with Financial Controller who himself takes care of the treasury department / Portfolio.
Therefore, as far as from Indian context, it can be concluded that, controller is also responsible for treasury jobs & there is no separate treasurer / treasury department exists
Question 1b: firm purchases a machinery for Rs. 8, 00,000 by making a down payment of Rs.1,50,000 and remainder in equal installments of Rs. 1,50,000 for six years. What is the rate of interest to the firm?
Answer to Q1b:
Particulars
Cost of Machinery
Down Payment made by firm
Financed through borrowings Ref
Year 0
(a)
800,000
(b)
c