PART 2:
Financial Management
Introduction

Part two is aimed at equipping the participants with the basic accounting skills and an understanding of:

• Basic financial management.
• Time value of money.
• Sources of funding for transport their requirements.
• Cost of capital.
• The capital asset pricing model.
• The international finance system

Specific Learning Outcome

The module is included to equip the learners on the basics of financial management. The learners need to know various forms of the business and how to satisfy the various needs of the shareholders and other stake holders of the enterprise. Learners need to know various sources of finance available to transportation sector, assessing the cost of these sources of finance.
After completion of this part the participants will have an understanding of the basic understanding of financial management and be able to distinguish with the basic financial accounting. Despite being a small economy with less a small financial market, the learners will be introduced to international finance but also other concepts which are not yet on the local financial market. As outlined earlier on the purpose is not to produce financial managers, but at the same time the course is not aimed at producing half baked bread so the learners should brace for more complicated financial management theories.

Sessions to be Covered

This part has 5 units which will be covered in 15 sessions and will take 22hours. The summary of topics to be covered at each session is outlined below:

1. Basic Financial Management
   • Evolution of finance.
   • Agency relationship
   • Different forms of business.
2. Fundamental Concepts in Financial Management
   • Time value of money.
   • Risk and rates of return
3. Sources of Funding for the Transport Sector
   • Short term sources of finance.
   • Share markets and their valuation.
   • Bond and other long term of finance.
   • Role of Privatisation.
4. Risk Analysis
   • Cost of capital.
   • The capital asset pricing model.
   • Capital structure and the weighted average cost of capital.
5. International Finance System
   • The global economic environment.
   • Introduction to foreign currency risk