Corporate Administration

Unit 1 {Book}

Company Meaning, Definition, Features, Advantage and Limitations

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Joint Stock Company Meaning, Features, Advantage and Disadvantage

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Steps in Formation of Joint Stock Company

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Companies Act 2013

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Kinds of Companies

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One Person Company

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Private Company

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Public Company

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Company Limited by Guarantee

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Company Limited by Shares

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Holding Company

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Subsidiary Company

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Government Company

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Associate Company

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Small Company

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Foreign Company

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Global Company

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Body Corporate

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Listed Company

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Unit 2 {Book}

Promoter Meaning and Function

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Promoter Positions

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Promotion Stage

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Incorporation Stage

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Meaning and Contents of Memorandum of Association

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Meaning and Contents of Articles of Association

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Distinction between Memorandum of Association and Articles of Association

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Certificate of Incorporation

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Incorporation of Business

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Subscription Stage

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Statement in Lieu of Prospectus and Book Building

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Commencement Stage

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Register of Company

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Certificate of Commencement of Business

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Unit 3 {Book}

Key Managerial Personnel

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Auditors Meaning, Appointment and Qualities

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Auditors Power, Duties and Types

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Managing Director Meaning, Appointment Power, Duties and Responsibility

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Audit Committee

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CSR Committee

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Company Secretary Meaning, Roles, Responsibilities and Types

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Company Secretary Qualification, Appointment, Position, Rights, Liabilities and Dismissal

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Unit 4 {Book}

Corporate Meetings Meanings, Importance, Components, Advantage and Disadvantage

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Types of Meetings, Annual General Meeting, Extraordinary General Meeting

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Board Meeting and Resolution

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Board Meeting Agenda

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Quorum of Meeting

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Unit 5 {Book}

Global Company

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Global Company Types and Features

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Legal Formalities of Global Companies

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Administration of Global Companies

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Marketing and Services Management

Unit 1 {Book}

Marketing Definitions, Meaning and Goals

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Marketing importance

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Concept of Marketing

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Approaches to Marketing

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Functions of Marketing

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Recent Trends in Marketing

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E-Business

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Tele-Marketing

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Mobile Business

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Green Marketing

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Retailing

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Customer Relationship Management

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Unit 2 {Book}

Marketing Environment

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Marketing Environment in India

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Types of Marketing Environment: Micro Environment

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Types of Marketing Environment: Macro Environment

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Market Segmentation

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Consumer Behaviour

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Factors Influencing Consumer Behaviour

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Features and importance of Consumer Behaviour

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Types of Consumer Behaviour

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Bases of Market Segmentation

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Unit 3 {Book}

Marketing Mix

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Elements of Marketing Mix

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Product

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Product Mix

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Product Line

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Product Life Cycle

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Product Planning

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New Product Development

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Branding

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Packing and Packaging

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Pricing

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Factor Influencing Pricing, Pricing Policy, Methods of Pricing

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Physical Distribution

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Factors Affecting Distribution Channels

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Types of Marketing Channels

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Sales Promotion

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Promotion

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Personal Selling and Advertising

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Personal Selling Process

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Unit 4 {Book}

Services Meaning and Characteristics

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Classification of Services

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Marketing Mix in Service Industry

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Growth of Service Sector in India

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Service Process

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Designing the Service Process

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Service Blueprint

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Back Office and Front Office Process

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Unit 5 {Book}

Tourism and Travel Services

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Healthcare Services

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Educational Services

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Indian Financial System

Unit 1 {Book}

Financial System

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Classification of Financial System

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Financial Market

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Structure of financial Market

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Functions and Significance of Primary Market

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Functions and Significance of Secondary Market

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Capital Market

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Money Market

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Unit 2 {Book}

Types of Banking

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Non-Banking Financial Institutions

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Objectives & Functions of IDBI

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Objectives & Functions of SFCs

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Objectives & Functions of SIDCs

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Objectives & Functions of LIC

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Objectives & Functions of EXIM Bank

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Mutual Funds

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Features and Importance of Mutual Funds

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Mutual fund in India

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Unit 3 {Book}

Commercial Banks

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Regulatory environment of Commercial Banking

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Operational aspects of commercial Banking

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Investment Policy of Commercial Banks

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Narasimaham Committee Report on Banking Sector Reforms

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Unit 4 {Book}

Reserve Bank of India (RBI) Meaning, Function and Role

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Reserve Bank of India Organization, Objectives

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Securities Exchange Board of India (SEBI) Introduction, Objectives, Function, Achievements, Issues and Suggestion

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Sebi

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Unit 5 {Book}

Financial Services

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Significance of financial Services

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Utility of financial Services

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Types of Financial Services

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Factoring

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Leasing

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Venture Capital

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Consumer Finance

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Housing

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Financial Accounting

Unit 1 {Book}

Financial Accounting

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Accounting Meaning, Objectives

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Accounting Scope

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Accounting Functions and Attributes

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Users of Accounting Information

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Accounting Principles

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Accounting Concept vs Accounting Conventions

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Accounting Standards List of Indian Accounting Standards

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Unit 2 {Book}

Single Entry System Meaning, Features, Characteristics, Types and Limitation

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Merits and Demerits of Single-Entry System

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Conversion into Double Entry System

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Preparation of Statement of Affairs

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Cashbook

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Memorandum

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Trading Account

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Total Debtors Account

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Total Creditors Account

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Bills Receivable and Bills Payable Accounts

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Trading, Profit and Loss Account

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Balance Sheet

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Unit 3 {Book}

Hire Purchase and Installment Purchase

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Hire Purchase Agreement

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Hire Purchase Price

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Cash Price

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Hire Purchase Charges

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Calculation of Interest

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Calculation of Cash Price

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Journal Entries and Ledger Accounts in the Book of Hire Purchase and Hire Vendor

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Unit 4 {Book}

Royalty Accounts

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Treatment of Strike and Stoppage of Work

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Accounting Treatment in the Books of Lessee

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Accounting Treatment in the Books of Lessor

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Journal Entries and Ledger Accounts Including Minimum Rent Account

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Unit 5 {Book}

Conversion of Partnership Firm into a Limited Company

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Purchase Consideration

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Journal Entries and Ledger Accounts in the Book of Vendor

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Dissolution Expenses

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Unrecorded Assets and Liabilities

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Assets and Liabilities not Taken Over by the Purchasing Company

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Contingent Liabilities

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Incorporation Entries

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Preparation of Balance Sheet of the Purchasing Company under Vertical Format

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Bangalore University B.Com Notes

Latest SEP Syllabus Notes

1st Semester

Financial Accounting (Updated) VIEW
Corporate Law (Updated) VIEW
Modern Marketing (Updated) VIEW
Business Quantitative Analysis (Updated) VIEW
Environmental Studies (Updated) VIEW

 

2nd Semester

Advanced Financial Accounting (Updated) VIEW
Modern Banking (Updated) VIEW
Human Capital Management (Updated) VIEW
Business Data Analysis (Updated) VIEW
Computer Accounting Tally Prime (Practical, No Update)

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NEP Syllabus Notes

1st Semester

Financial Accountancy (Updated) VIEW
Business Management & Startups (Updated) VIEW
Principles of Marketing (Updated) VIEW
Digital Fluency (Updated) VIEW
Spreadsheet for Business (Updated) VIEW
Financial Literacy (Updated) VIEW
Business Documents (Updated) VIEW

2nd Semester

Advanced Financial Accounting (Updated) VIEW
Business Ethics (Updated) VIEW
Banking Innovations (Updated) VIEW
E-Business (Updated) VIEW
Fundamentals of Investments in Capital Market (Updated) VIEW
Digital Fluency (Updated) VIEW

3rd Semester

Corporate Accounting (Updated) VIEW
Business Mathematics & Statistics (Updated) VIEW
Indian Financial Services (Updated) VIEW
Company Law & Administration (Updated) VIEW
Constitution of India (Updated) VIEW
Entrepreneurship Skills (Updated) VIEW
Investments in Stock Market (Updated) VIEW

4th Semester

Advanced Corporate Accounting (Updated) VIEW
Cost Accounting (Updated) VIEW
Business Regulations (Updated) VIEW
Artificial Intelligence (No Update) VIEW
Corporate Governance (Updated) VIEW
Investments in Commodity Markets (Updated) VIEW

5th Semester

Financial Management (Updated) VIEW
Income Tax Law and Practice-I (Updated) VIEW
Principles and Practice of Auditing (Updated) VIEW
A1 Indian Accounting Standards-I (Updated) VIEW
F1 Financial Institutions and Markets (Updated) VIEW
M1 Retail Management (Updated) VIEW
H1 Human Resources Development (Updated) VIEW
I1 Basics of Business Analytics (Updated) VIEW
GST Law & Practice (Updated) VIEW
Digital Marketing (Updated) VIEW
Cyber Security (Updated) VIEW
Employability Skills VIEW

6th Semester

Advanced Financial Management (Updated) VIEW
Income Tax Law and PracticeII (Updated) VIEW
Management Accounting (Updated) VIEW
A2 Indian Accounting Standards2 (Updated) VIEW
F2 Investment Management (Updated) VIEW
M2 Customer Relationship Management (Updated) VIEW
H2 Cultural Diversity at Work Place (Updated) VIEW
I2 HR Analytics (Updated) VIEW
Assessment of Persons other than Individuals and Filing of ITRs (Updated) VIEW
ECommerce (Updated) VIEW

CBCS 2020-21 Syllabus

1st Semester

Financial Accounting (Updated) VIEW
Fundamentals of Management and Life Skills (Updated) VIEW
Business Organization & Market Dynamics (Updated) VIEW
Business Mathematics (No Updated) VIEW

2nd Semester

Advanced Financial Accounting (Updated) VIEW
Marketing & Event Management (Updated) VIEW
Human Capital Management (Updated) VIEW
Quantitative Analysis for Business Decision (Updated) VIEW

3rd Semester

Corporate Accounting (Updated) VIEW
Financial Management (Updated) VIEW
Elements of Costing (Updated) VIEW
Indian Financial System (Updated) VIEW

4th Semester

Advanced Corporate Accounting (Updated) VIEW
Costing Methods (Updated) VIEW
E-Business & Computerized Accounting (Updated) VIEW
Business Regulations (Updated) VIEW

5th Semester

Subjects
Income Tax I (Updated) VIEW
Cost Management (Updated) VIEW
Indian Accounting Standards (Updated) VIEW
Auditing and Reporting (Updated) VIEW
Accounting & Taxation Group  
AC5.5 Advanced Accounting (Updated) VIEW
AC5.6 Accounting for Government and Local Bodies (Updated) VIEW
Finance Group  
FN5.5 Corporate Financial Management (Updated) VIEW
FN5.6 Strategic Financial management (Updated) VIEW
Marketing Group  
MK5.5 Consumer Behaviour & Market Research (Updated) VIEW
MK5.6 Advertising & Media Management (Updated) VIEW
HR Group
HR5.5 Performance Management (Updated) VIEW
HR5.6 Strategic Human Resource Management (Updated) VIEW

6th Semester

Subjects
Income Tax II (Updated) VIEW
Management Accounting (Updated) VIEW
Goods & Services Tax VIEW
Entrepreneurship and Ethics (Updated) VIEW
Accounting & Taxation Group
AC6.5 Business Taxation (Updated) VIEW
AC6.6 Financial Reporting and Corporate Disclosures (Updated) VIEW
Finance Group
FN6.5 Derivatives and Risk Management (Updated) VIEW
FN6.6 International Financial Management (Updated) VIEW
Marketing Group
MK6.5 Retail Management (Updated) VIEW
MK6.6 International Marketing Management (Updated) VIEW
HR Group
HR6.5 Labour Welfare and Social security (Updated) VIEW
HR6.6 International Human Resource Management VIEW

>>>Old Syllabus<<<

1st Semester

Financial Accounting (Updated)
VIEW
Indian Financial System (Updated) VIEW
Marketing and Services Management (Updated) VIEW
Corporate Administration (Updated) VIEW
Methods and Techniques for Business Decisions (Updated) VIEW

2nd Semester

Advanced Financial Accounting (Updated) VIEW
Retail Management (Updated) VIEW
Banking Law and Operations (Updated) VIEW
Quantitative Analysis for Business Decisions–1 (Updated) VIEW

3rd Semester

Corporate Accounting (Updated) VIEW
Financial Management (Updated) VIEW
Business Ethics (Updated) VIEW
Quantitative Analysis for Business Decisions–2 (Updated) VIEW
Public Relations and Corporate Communication (Updated) VIEW

4th Semester

Advanced Corporate Accounting (Updated)

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Cost Accounting (Updated)

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E-Business and Accounting (Updated)

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Stock and Commodity Markets (Updated)

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Principles of Event Management (Updated)

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5th Semester

Entrepreneurship Development

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International Financial Reporting Standards

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Income Tax – 1

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Costing Methods

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Accounting & Taxation group:

AC5.5 Advanced Accounting

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AC5.6 Goods and Services Tax

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Finance Group:

FN5.5 International Financial Management

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FN5.6 Goods and Services Tax

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Information & Technology Group:

IT5.5 Accounting Information Systems

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IT5.6 Enterprise Resource Planning

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Banking & insurance Group:

BI5.5 International Banking & Forex Management

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BI5.6 Life & General Insurance

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6th Semester

Business Regulations (Updated)

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Principles and Practice of Auditing (Updated)

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Income Tax – 2 (Updated)

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Management Accounting (Updated)

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Accounting & Taxation group:

 

AC6.5 Business Taxation (Updated)

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AC6.6 Cost Management (Updated)

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Finance Group:

FN6.5 Performance Management (Updated)

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FN6.6 International Auditing & Assurance  (Updated)

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Information & Technology Group:

IT6.5 Information Technology and Audit (Updated)

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IT6.6 Banking Technology and Management (Updated)

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Banking & insurance Group:

BI6.5 Risk Management (Updated)

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BI6.6 Marketing of Insurance Products (Updated)

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e-mail

Electronic mail (email, e-mail, eMail or e-Mail) is a method of exchanging messages (“mail”) between people using electronic devices. Email entered limited use in the 1960s, but users could only send to users of the same computer, and some early email systems required the author and the recipient to both be online simultaneously, similar to instant messaging. Ray Tomlinson is credited as the inventor of email; in 1971, he developed the first system able to send mail between users on different hosts across the ARPANET, using the @ sign to link the user name with a destination server. By the mid-1970s, this was the form recognized as email.

Email gives an excellent opportunity to coolly compose your thoughts, couch it in appropriate language and put it in writing, go through it over and again, fine tuning or revising it before you hit the send button. You don’t have that kind of advantage in a telephone conversation. Many time you forget what you planned to say.

Email operates across computer networks, primarily the Internet. Today’s email systems are based on a store-and-forward model. Email servers accept, forward, deliver, and store messages. Neither the users nor their computers are required to be online simultaneously; they need to connect, typically to a mail server or a webmail interface to send or receive messages or download it.

Originally an ASCII text-only communications medium, Internet email was extended by Multipurpose Internet Mail Extensions (MIME) to carry text in other character sets and multimedia content attachments. International email, with internationalized email addresses using UTF-8, is standardized but not widely adopted.

The history of modern Internet email services reaches back to the early ARPANET, with standards for encoding email messages published as early as 1973 (RFC 561). An email message sent in the early 1970s is similar to a basic email sent today.

Historically, the term electronic mail is any electronic document transmission. For example, several writers in the early 1970s used the term to refer to fax document transmission. As a result, finding its first use is difficult with the specific meaning it has today.

The term electronic mail has been in use with its current meaning since at least 1975, and variations of the shorter E-mail have been in use since at least 1979:

  • Email is now the common form, and recommended by style guides. It is the form required by IETF Requests for Comments (RFC) and working groups. This spelling also appears in most dictionaries.
  • E-mail is the form favored in edited published American English and British English writing as reflected in the Corpus of Contemporary American English data, but is falling out of favor in some style guides.
  • Email is a traditional form used in RFCs for the “Author’s Address” and is required “for historical reasons“.
  • E-mail is sometimes used, capitalizing the initial E as in similar abbreviations like E-piano, E-guitar, A-bomb, and H-bomb.

In the original protocol, RFC 524, none of these forms was used. The service is simply referred to as mail, and a single piece of electronic mail is called a message.

An Internet e-mail consists of an envelope and the content consists of a header and a body.

Message format

The basic Internet message format used for email is defined by RFC 5322, with encoding of non-ASCII data and multimedia content attachments defined in RFC 2045 through RFC 2049, collectively called Multipurpose Internet Mail Extensions or MIME. The extensions in International email apply only to email. RFC 5322 replaced the earlier RFC 2822 in 2008, then RFC 2822 in 2001 replaced RFC 822 – the standard for Internet email for decades. Published in 1982, RFC 822 was based on the earlier RFC 733 for the ARPANET.

Internet email messages consist of two sections, ‘header’ and ‘body’. These are known as ‘content’. The header is structured into fields such as From, To, CC, Subject, Date, and other information about the email. In the process of transporting email messages between systems, SMTP communicates delivery parameters and information using message header fields. The body contains the message, as unstructured text, sometimes containing a signature block at the end. The header is separated from the body by a blank line.

Message header

RFC 5322 specifies the syntax of the email header. Each email message has a header (the “header section” of the message, according to the specification), comprising a number of fields (“header fields”). Each field has a name (“field name” or “header field name”), followed by the separator character “:”, and a value (“field body” or “header field body”).

Each field name begins in the first character of a new line in the header section, and begins with a non-whitespace printable character. It ends with the separator character “:”. The separator follows the field value (the “field body”). The value can continue onto subsequent lines if those lines have space or tab as their first character. Field names and, without SMTPUTF8, field bodies are restricted to 7-bit ASCII characters. Some non-ASCII values may be represented using MIME encoded words.

Header fields

Email header fields can be multi-line, with each line recommended to be no more than 78 characters, although the limit is 998 characters. Header fields defined by RFC 5322 contain only US-ASCII characters; for encoding characters in other sets, a syntax specified in RFC 2047 may be used. In some examples, the IETF EAI working group defines some standards track extensions, replacing previous experimental extensions so UTF-8 encoded Unicode characters may be used within the header. In particular, this allows email addresses to use non-ASCII characters. Such addresses are supported by Google and Microsoft products, and promoted by some government agents.

The message header must include at least the following fields:

  • From: The email address, and, optionally, the name of the author(s). Some email clients are changeable through account settings.
  • Date: The local time and date the message was written. Like the From: field, many email clients fill this in automatically before sending. The recipient’s client may display the time in the format and time zone local to them.

RFC 3864 describes registration procedures for message header fields at the IANA; it provides for permanent and provisional field names, including also fields defined for MIME, netnews, and HTTP, and referencing relevant RFCs. Common header fields for email include:

  • To: The email address(es), and optionally name(s) of the message’s recipient(s). Indicates primary recipients (multiple allowed), for secondary recipients see Cc: and Bcc: below.
  • Subject: A brief summary of the topic of the message. Certain abbreviations are commonly used in the subject, including “RE:” and “FW:”.
  • Cc: Carbon copy; Many email clients mark email in one’s inbox differently depending on whether they are in the To: or Cc: list.
  • Bcc: Blind carbon copy; addresses are usually only specified during SMTP delivery, and not usually listed in the message header.
  • Content-Type: Information about how the message is to be displayed, usually a MIME type.
  • Precedence: commonly with values “bulk”, “junk”, or “list”; used to indicate automated “vacation” or “out of office” responses should not be returned for this mail, e.g. to prevent vacation notices from sent to all other subscribers of a mailing list. Sendmail uses this field to affect prioritization of queued email, with “Precedence: special-delivery” messages delivered sooner. With modern high-bandwidth networks, delivery priority is less of an issue than it was. Microsoft Exchange respects a fine-grained automatic response suppression mechanism, the X-Auto-Response-Suppress field.
  • Message-ID: Also an automatic-generated field to prevent multiple deliveries and for reference in In-Reply-To: (see below).
  • In-Reply-To: Message-ID of the message this is a reply to. Used to link related messages together. This field only applies to reply messages.
  • References: Message-ID of the message this is a reply to, and the message-id of the message the previous reply was a reply to, etc.
  • Reply-To: Address should be used to reply to the message.
  • Sender: Address of the sender acting on behalf of the author listed in the From: field (secretary, list manager, etc.).
  • Archived-At: A direct link to the archived form of an individual email message.
  • The To: field may be unrelated to the addresses to which the message is delivered. The delivery list is supplied separately to the transport protocol, SMTP, which may be extracted from the header content. The “To:” field is similar to the addressing at the top of a conventional letter delivered according to the address on the outer envelope. In the same way, the “From:” field may not be the sender. Some mail servers apply email authentication systems to messages relayed. Data pertaining to the server’s activity is also part of the header, as defined below.

SMTP defines the trace information of a message saved in the header using the following two fields:

  • Received: after an SMTP server accepts a message, it inserts this trace record at the top of the header (last to first).
  • Return-Path: after the delivery SMTP server makes the final delivery of a message, it inserts this field at the top of the header.

Other fields added on top of the header by the receiving server may be called trace fields.

  • Authentication-Results: after a server verifies authentication, it can save the results in this field for consumption by downstream agents.
  • Received-SPF: stores results of SPF checks in more detail than Authentication-Results.
  • DKIM-Signature: stores results of DomainKeys Identified Mail (DKIM) decryption to verify the message was not changed after it was sent.
  • Auto-Submitted: is used to mark automatic-generated messages.
  • VBR-Info: claims VBR whitelisting

Importance

Easy to use: E-mail frees us from the tedious task of managing data for daily use. It helps us manage our contacts, send mails quickly, maintain our mail history, store the required information, etc.

Speed: An e-mail is delivered instantly and anywhere across the globe. No other service matches the e-mail in terms of speed.

Easy to prioritize: Because e-mails come with a subject line, it is easy to prioritize them and ignore the unwanted ones.

Reliable and secure: Constant efforts are being taken to improve the security in electronic mails. It makes e-mail one of the secured ways of communication.

Informal and conversational: The language used in e-mails is generally simple and thus, makes the process of communication informal. Sending and receiving e-mails takes less time, so it can be used as a tool for interaction.

Easier for reference: When a person needs to reply to a mail, he/she can use the provision of attaching previous mails as references. It helps refresh the recipient’s know-how on what he is reading.

Automated e-mails: It is possible to send automated e-mails using special programs like auto responders. The auto responders reply only to those messages with generalized, prewritten text messages.

Environment friendly: Postal mails use paper as a medium to send letters. Electronic mail therefore, prevents a large number of trees from getting axed. It also saves the fuel needed for transportation.

Use of graphics: Colourful greeting cards and interesting pictures can be sent through e-mails. This adds value to the e-mail service. Advertising tool: Nowadays, many individuals and companies are using the e-mail service to advertise their products, services, etc.

Info at your fingertips: Storing data online means less large, space taking file cabinets, folders and shelves. You can access information far quicker if you learn how to use email this way.

Leverage: Send the same message to any number of people. Adaptations are simple, too. If you have a product or service to sell, email is an effective medium to get your message out.

Send reminders to yourself. Do you use more than one account? Email yourself messages from work to home or vice versa.

Objectives

  1. Inform

One of the main objectives of an email marketing campaign is to inform your readers. Showing up in your customers’ inboxes regularly presents a great opportunity to keep them informed about everything and anything about your company.

  1. Engage

Not only should they be informational, beneficial, and attractive, but you should also be sure that they engage recipients so they will want to learn more about your business and your brand as a whole. Make your emails engaging with images, graphics, and even videos to make sure that recipients read the emails in their entirety and digest all of the information you’ve provided.

  1. Attract

Another objective of email marketing is to attract users to your company. You may think that since current customers have already committed to your company, that there’s no need to attract them anymore. The truth is, current customers have the choice to stop buying products or services from your brand whenever they choose, and email marketing is a great way to ensure that you consistently win them over.

Human Resource Development (HRD): Meaning, Concept and Objectives

With increasing global competition, organizations are under tremendous pressure to improve their performance through reduction of cost and in quality up gradation. Indian business organizations too have now realised that they are now in a more open, highly competitive, and market-oriented environment.

The three challenges for Indian business organizations are:

  • How to maximize return on investments?
  • How to be more innovative and customer driven?
  • How to renew and revitalise an organization?

In this context, the most important steps are- effective management; holistic development; and optimum utilization of human resources.

In the past decade something quite different was happening in many Indian organizations, calling for a second look at traditional personnel functions and their integration with organizational objectives. Several steps were taken, such as, conceptualization of employees as resources; strategic role of personnel functions; greater partnership to line managers in managing human resources; dovetailing of training with other personnel functions; synthesis of different personnel functions, etc.

It is difficult to categorise these activities under a single label. Rather, they can be brought under the umbrella of Human Resource Development (HRD).

The human resource development in India is of recent origin, and the terms gained currency only in the early seventies. The term “HRD” was first applied in 1968 in George Washington University. It was used in Miami at the conference of American Society for Training and Development in 1969.

The term was gaining more acceptances during the mid-1970, but many used it as a more alternative term than “Training and Development”. In the opinion of some management professionals, Japan is the first country to begin with HRD practices. “Better People”, not merely better technology, is the surest way to a “Better Society”, is the most popular belief in Japan.

It is often said that an organization is only as good as its people. Organizations of all types and sizes, including schools, retail stores, government agencies, restaurants, and manufacturers, have at least one thing in common they must employ competent and motivated workers.

This need has become even stronger as organizations grapple with the challenges presented by a fast-paced, highly dynamic, and increasingly global economy. To compete and thrive, many organizations are including employee education, training, and development as an important and effective part of their organizational strategy.

HRD activities should begin when an employee joins an organization and continue throughout his or her career, regardless of whether that employee is an executive or a worker on an assembly line. HRD programmes must respond to job changes and integrate the long-term plans and strategies of the organization to ensure the efficient and effective use of resources.

Concept of Human Resource Development

A number of definitions of Training and HRD have been given by the pioneers of Management Training and Human Resource Development.

Milton Hall defines ‘Employee Training’ as the process of aiding employees to gain effectiveness in their present and future work through development of appropriate habits of thought and action, skill, knowledge and attitudes. Training aims at increasing the effectiveness with which the functions of an organization are carried, out by increasing the effectiveness of its personnel.

The definition given by Milton Hall stresses development of knowledge, skill and attitude. As far as knowledge and skills are concerned, it is possible with planned effort on part of HRD executive.

In respect of attitudes, improvements are possible only with long range efforts and planned efforts by HRD executive and success in this area cannot be much predicted or ensured as it would largely depend on the willingness and readiness of the person, or persons whose attitude is to be improved.

With regard to development of attitudes the following factors are to be given due importance and consideration, before HRD effort is planned:

  1. The desired change in attitude should be positive in nature.
  2. Before an effort to improve the attitude of a person is tried or envisaged, the person concerned should agree and have conviction that he requires a change in his attitude and this is going to prove to his benefit, with respect of his career development and success in his working life.
  3. The working conditions and the culture of the organization should offer to induce the employees to adopt positive attitude and aptitude which works to motivate a person to do things to meet the desired standard of behaviour and output to achieve the desired targets of production and services assigned to his area of working.

Human Resource Development at Macro and Micro Level

HRD is applicable to both at macro level (national level) as well as micro level (organizational level). At the macro level, HRD is concerned with the development of people of country as a whole. For example, HRD ministry of Government of India is concerned with developing people in whole of country.

At micro level, each organization is concerned with developing its human resources. While HRD at macro level has uniformity, it differs at micro level because each organization may have distinct approach for developing human resources.

There is close relationship between HRD at macro level and micro level. Macro level HRD provides human resources to organizations. Therefore, efforts at micro level HRD is influenced by macro level HRD. For example, overall quality of human resources of a country determines the type of efforts that individual organizations make in developing its human resources. If this quality is high, lower organizational efforts are required. In the alternative case, higher organizational efforts are required.

HRD in Indian Context

Some specific features of HRD in India are as follows:

  1. At the macro level, there are plenty of educational institutions in India producing large number of educated people every year. However, quality of majority of such people is very low. Therefore, they are not employable.

According to National Employability Report, 2014, only 18.33 per cent engineering graduates are employable. Similar is the case with management graduates. So far as other educational disciplines are concerned, the situation is even worse except some professional disciplines.

  1. At the micro level, HRD efforts of individual organizations differ widely. There are many organizations which pay very high attention to HRD. They spend lot of money in developing their human resources. Such organizations believe in developing competitive advantage through their human resources. As against this pattern, there are plenty of organizations which give very low importance to HRD. Such organizations treat HRD expenses as waste.

Objectives of Human Resource Development (HRD)

  • To maximize the utilization of human resources for the achievement of individual and organizational goals.
  • To provide an opportunity and comprehensive framework for the development of human resources in an organization for full expression of their talent and manifest potentials.
  • To develop the constructive mind and an overall personality of the employee;
  • To develop the sense of team spirit, team work and inter-team collaborations.
  • To develop the organizational health, culture and effectiveness.
  • To generate systematic information about human resources.

Sub Systems of HRD are:

  1. Training and Development
  2. Career planning and Succession planning
  3. Performance Appraisal and Potential Appraisal.

Process of Human Resources Development

HRD Process and HRD Climate Variables

  • Role Clarity.
  • Planning of Development by Every Employee.
  • Awareness of Competencies Required for Job Performance.
  • Proactive Orientation.
  • More Trust.
  • Collaboration and Team Work.
  • Risk-taking.
  • Value Generation.
  • Clarification of Norms and Standards.
  • Increased Communication.
  • More Objective Rewards.
  • Generation of Objective, Data on Employees etc.

HRD Outcomes Variables

  • More Competent People.
  • Higher Work Commitment and Job Involvement.
  • More Problem Solving.
  • Better Utilization of Human.
  • Higher Job Satisfaction and Work Motivation.
  • Better Generation of Internal Resources.
  • Better Organizational Health.
  • More Team Work, Synergy and Respect for Each Other.

Organizational Effectiveness Dimensions

  • Higher Productivity.
  • Growth and Diversification.
  • Cost Reduction.
  • More Profits.
  • Better Image

Organizational effectiveness is a step closer to HRD outcomes variables than the process variables. For example, better communication, role clarity, performance planning, trust, collaboration, openness can be considered as more remotely related to organization effectiveness than variables like having competent, dynamic, satisfied and committed employees.

It is the adequacy of the HRD processes in the organization which is questioned if the HRD outcomes are not present in an organization at a satisfactory level.

The linkages between organizational effectiveness and HRD outcomes are not easily demonstrable due to the influence of several other variables in determining productivity. The Chief Executives, unit heads, line managers and HRD managers interested in HRD have to make efforts to promote HRD processes and culture in their organizations as a matter of ‘faith’ or ‘philosophy’ and not look for demonstrable outcomes in terms of organizational effectiveness.

There exists another kind of relationships which needs attention. This is the relationship between HRD mechanisms and HRD processes. Only introduction of HRD mechanisms and HRD departments do not automatically result in the development of HRD processes, It is possible to have a HRD culture without having a HRD department or without using any HRD systems. That requires good leadership at the top, vision and building of HRD values froth the very beginning of an organization.

The concept of human resources in HRD is not value-free. Broadly speaking, there are three meanings attached to the concept of HRD. In the first place, persons working in organisations are regarded as a valuable resource, implying that there is a need to invest time and effort in their development. Second, they are human resources, which means that they have their own special characteristics and, therefore, cannot be treated like material resources. The approach focuses on the need to humanise organisational life and introduce human values in the organisation. Third, human resource development does not merely focus on employees as individuals, but also on other social units and processes in the organisation. These include the role or the job a person has in the organisation, the dyadic unit (consisting of the person and his supervisor), the various teams in which people work, inter-team processes, and the total organisation. Therefore, six distinguishable human units are included in human resources, namely, persons, jobs or roles, dyads, teams, inter-teams and the organisation.

Primary Equity Market

The primary market is the financial market where new securities are issued and become available for trading by individuals and institutions. The trading activities of the capital markets are separated into the primary market and secondary market.

In a primary market, securities are created for the first time for investors to purchase. New securities are issued in this market through a stock exchange, enabling the government as well as companies to raise capital.

For a transaction taking place in this market, there are three entities involved. It would include a company, investors, and an underwriter. A company issues security in a primary market as an initial public offering (IPO), and the sale price of such new issue is determined by a concerned underwriter, which may or may not be a financial institution. An underwriter also facilitates and monitors the new issue offering. Investors purchase the newly issued securities in the primary market. Such a market is regulated by the Securities and Exchange Board of India (SEBI).

The entity which issues securities may be looking to expand its operations, fund other business targets or increase its physical presence among others. Primary market example of securities issued includes notes, bills, government bonds or corporate bonds as well as stocks of companies.

The primary market is where companies issue a new security, not previously traded on any exchange. A company offers securities to the general public to raise funds to finance its long-term goals. The primary market may also be called the New Issue Market (NIM). In the primary market, securities are directly issued by companies to investors. Securities are issued either by an Initial Public Offer (IPO) or a Further Public Offer (FPO).

An IPO is the process through which a company offers equity to investors and becomes a publicly-traded company. Through an IPO, the company is able to raise funds and investors are able to invest in a company for the first time. Similarly, an FPO is a process by which already listed companies offer fresh equity in the company. Companies use FPOs to raise additional funds from the general public.

Raising Funds from the Primary Market

Below are some of the ways in which companies raise funds from the primary market:

  1. Public Issue

This is the most common way to issue securities to the general public. Through an IPO, the company is able to raise funds. The securities are listed on a stock exchange for trading purposes.

  1. Rights Issue

When a company wants to raise more capital from existing shareholders, it may offer the shareholders more shares at a price discounted from the prevailing market price. The number of shares offered is on a pro-rata basis. This process is known as a Rights Issue.

  1. Preferential Allotment

When a listed company issues shares to a few individuals at a price that may or may not be related to the market price, it is termed a preferential allotment. The company decides the basis of allotment and it is not dependent on any mechanism such as pro-rata or anything else.

Why companies issue shares to the public?

Companies come to the primary market to raise money for expansion. As each and every company requires capital for expansion and growth.

The capital can be in the form of:

  • Equity: It is termed as the stock capital of the company, also known as share capital.
  • Debt: it is termed as the loans taken by the business

The money raised in the primary market goes directly to issuing company. It is a place where capital formation takes place.

The issue can be in the form of a public issue, private placement, preferential issue, rights, and bonus issue.

A public issue does not limit anyone (individual, organization, or corporate) in investing, while in private placement, the issuance is done to select a number of people.

  • Allotment done to more than 200 people, becomes public allotment
  • Allotment done to less than 200 people, becomes private allotment

Since the securities are directly issued by the companies to its investors, the company receives the money and issues certificate of security to the investor.

The securities issued to the investors in the primary market in:

  • Face value
  • Premium value
  • Par value

When the issue of securities closes, then the securities are traded on the secondary market such as stock exchange, bonds market, derivative exchange.

Primary Market

Secondary Market

It is a way of issuing fresh shares in the market. It is also called New Issue Market. A major component of the primary market is the IPO. It is a place where already issued or existing shares are traded. It is called After Issue Market.
The amount received from the issue of shares goes to the company for their business expansion purposes. The amount invested by the buyer of shares goes to the seller, and hence the company doesn’t receive anything.
Securities are issued by the companies to the investors. Securities are exchanged between buyers and sellers, and stock exchanges facilitates the trade.
The securities are all issued at one price for all investors participating in the offering. Securities are exchanged at the market price.
The primary market doesn’t provide liquidity for the stock. The secondary market provides liquidity to the stock.
Underwriters act as intermediaries. Brokers act as intermediaries.
On the primary market, security can be sold just once. On the secondary market, securities can be sold innumerable times.

Functions of Primary Market

To understand the primary market definition in depth, let’s also discuss the functions of primary market. The general function of primary market is to channelize funds in to industrial enterprises. There are three functions of primary market which are given below:

  1. Origination

The term origination refers to the work of investigation and analysis and processing of new proposals. Specialist agencies perform these functions which act as sponsors of the issue. The preliminary investigation entails careful study of technical, economical, financial, and legal aspects of the issuing companies.

This is to ensure that it warrants the backing of the issue houses in the sense of lending their name to the company. Thus, give the issue the stamp of respectability. It shows company is strong, has good market prospects and is worthy of stock exchange quotation.

In the process of origination the sponsoring institutions render, as a second function, some service of an advisory nature which goes to improve the quality of capital issues. These services include advice on such aspects of capital issues as:

  • Determination of the class of securities that are going to issue and price of the issues in the light of market conditions”
  • The timing and magnitude of issues
  • Methods of flotation, and
  • Technique of selling, and so on market.
  1. Underwriting

In order to get the success of the issue, underwriters came into role. They guarantee the selling of the issue in case it is not subscribe by public. Hence eliminates the risk of uncertainty. Underwriting service is significant for both company as well as public. Company gets money and public get free of over stress.

  1. Distribution

The sale of securities to the ultimate investors is known as distribution. It is a specialist job which is performed by brokers and dealers in securities. They maintain direct and regular contact with the direct investors.

Significance of Primary Market

The key function of the primary market is to facilitate capital growth by enabling individuals to convert savings into investments. It facilitates companies to issue new stocks to raise money directly from households for business expansion or to meet financial obligations. It provides a channel for the government to raise funds from the public to finance public sector projects. Unlike the secondary market, such as the stock market which trades listed shares between buyers and sellers, the primary market exists for the issuance of new securities by corporations and the government directly to investors.

  1. Household Savings

Companies raise funds in the primary market by issuing initial public offerings (IPOs). These stock offerings authorize a share of ownership in the company to the extent of the stock value. Companies can issue IPOs at par (market value) or above par (a premium), depending on past performance and future prospectus. In a booming economy, a greater number of corporations float IPOs since more investors have surplus funds for investment purposes. Thus, the number of IPOs issued is indicative of the health of the economy. Invariably, smaller companies seeking funds for business expansion are the ones typically that float IPOs. But large, well-established firms also become publicly traded companies to gain visibility and to expand. Companies can raise an additional round of funding in the primary market by floating a secondary public offering.

  1. Global Investments

The primary market enables business expansion and growth for domestic and foreign companies. International firms issue new stocks–American Depository Receipts (ADRs -to investors in the U.S., which are listed in American stock exchanges. By investing in ADRs, which are dollar-denominated, you can diversify the risk associated with putting all your savings in just one geographical market.

  1. Sale of Government Securities

The government directly issues securities to the public via the primary market to fund public works projects such as the construction of roads, building schools etc. These securities are offered in the form of short-term bills, notes that mature in two to seven years, longer-term bonds and treasury inflation-protected securities (TIPS) linked to the Consumer Price Index. Visit the U.S. Treasury website for information about interest rates and maturity dates.

  1. Primary Market Participants

An investment bank sets the offer price of the corporate security as opposed to market forces, which determines the price in the secondary market. While brokerage firms and online licensed dealers sell IPOs to the public, you may not be allotted IPO shares because of the large demand for a small number of shares typically issued by the company. Moreover, institutional investors (large mutual funds and banks) usually get the lion’s share of much anticipated IPOs.

  1. Marker Risk

Government-issued U.S. Treasury bonds are free of credit risk. However, the Securities and Exchange Commission cautions investors that IPOs are inherently risky and therefore unsuited for low network individuals who typically are risk-averse.

Secondary Equity Market

Secondary market is also called as after market. Stock exchange is the secondary market. The stock exchange is the medium through which the exchange of shares, Equities takes place between the seller and the buyer. Secondary market is the place where most of the trading takes place. The trading of shares and capital in secondary market takes place between the buyer and the seller, company is not involved in transactions. The price of share is decided by demand and supply of the shares and price keeps on fluctuating. In secondary market no new stocks are issued, only trading of stocks is there.

Features of Secondary Market

  • Gives liquidity to all investors. Any seller in need of cash can easily sell the security due to the presence of a large number of buyers.
  • Very little time lag between any new news or information on the company and the stock price reflecting that news. The secondary market quickly adjusts the price to any new development in the security.
  • Lower transaction costs due to the high volume of transactions.
  • Demand and supply economics in the market assist in price discovery.
  • An alternative to saving.
  • Secondary markets face heavy regulations from the government as they are a vital source of capital formation and liquidity for the companies and the investors. High regulations ensure the safety of the investor’s money.

Major Instruments and Players in Secondary Market

The secondary market deals with fixed income, variable income, and hybrid instruments.

Fixed income instruments are usually debt securities like bonds, debentures. It also includes Preference shares.

Variable income instruments are equity and derivatives.

Hybrid instruments are preference shares and convertible debentures.

Major players in the market are Brokerage and Advisory services (commission broker, security dealers and more); Financial Intermediaries (Banks, Insurance companies, Mutual Fund, Non-Banking Financial companies); and retail investors.

Types of Secondary Markets

There are two types of secondary markets:

Exchanges

It is a marketplace, wherein there is no direct contact between the buyer and the seller, like NYSE or NASDAQ. There is no counterparty risk as an exchange is a guarantor. Also, heavy regulations make it a safe place for investors to trade securities. However, investors face a comparatively higher transaction cost due to exchange fees and commission.

Over-The-Counter (OTC) Markets

It is a decentralized place, where the market is made up of members trading among themselves. Foreign exchange market (FOREX) is one such type of market. There is more competition among the participants to get higher volume, so prices of security may vary from seller to seller. Also, OTC markets suffer from counterparty risk as parties deal with each other directly.

Pricing in Secondary Markets

In the primary market, the price of a security is set beforehand. However, in the secondary market, the price of a security is determined by its supply and demand. For instance, if most of the investors believe that the stock would gain going ahead, the demand for that stock goes up, and hence, its price. Similarly, if investors feel the stock will lose value, they will want to sell it, resulting in a price drop.

Importance of Secondary Markets

  • It is a good indicator of a country’s economic condition. A rise or drop in the stock market suggests a boom or recession in an economy.
  • It helps in valuing a company as economic forces of supply and demand determine the prices.
  • Ensures liquidity for the investors as one can easily buy or sell the securities.
  • It gives investors a chance to use their idle money to earn some returns.
  • It helps the company to monitor and control public perceptions.

Functions of Secondary Market

  • A stock exchange provides a platform to investors to enter into a trading transaction of bonds, shares, debentures and such other financial instruments.
  • Transactions can be entered into at any time, and the market allows for active trading so that there can be immediate purchase or selling with little variation in price among different transactions. Also, there is continuity in trading, which increases the liquidity of assets that are traded in this market.
  • Investors find a proper platform, such as an organized exchange to liquidate the holdings. The securities that they hold can be sold in various stock exchanges.
  • A secondary market acts as a medium of determining the pricing of assets in a transaction consistent with the demand and supply. The information about transactions price is within the public domain that enables investors to decide accordingly.
  • It is indicative of a nation’s economy as well, and also serves as a link between savings and investment. As in, savings are mobilized via investments by way of securities.

Significance of Secondary Markets

  • It is a good indicator of a country’s economic condition. A rise or drop in the stock market suggests a boom or recession in an economy.
  • It helps in valuing a company as economic forces of supply and demand determine the prices.
  • Ensures liquidity for the investors as one can easily buy or sell the securities.
  • It gives investors a chance to use their idle money to earn some returns.
  • It helps the company to monitor and control public perceptions.

Advantages of Secondary Market

  • Investors can ease their liquidity problems in a secondary market conveniently. Like, an investor in need of liquid cash can sell the shares held quite easily as a large number of buyers are present in the secondary market.
  • The secondary market indicates a benchmark for fair valuation of a particular company.
  • Price adjustments of securities in a secondary market takes place within a short span in tune with the availability of new information about the company.
  • Investor’s funds remain relatively safe due to heavy regulations governing a secondary stock market. The regulations are stringent as the market is a source of liquidity and capital formation for both investors and companies.
  • Mobilization of savings becomes easier as investors’ money is held in the form of securities.

Disadvantages of Secondary Market

  • Prices of securities in a secondary market are subject to high volatility, and such price fluctuation may lead to sudden and unpredictable loss to investors.
  • Before buying or selling in a secondary market, investors have to duly complete the procedures involved, which are usually a time-consuming process.
  • Investors’ profit margin may experience a dent due to brokerage commissions levied on each transaction of buying or selling of securities.

Investments in a secondary capital market are subject to high risk due to the influence of multiple external factors, and the existing valuation may alter within a span of a few minutes.

Flexible Budgets

A flexible budget adjusts to changes in actual revenue levels. Actual revenues or other activity measures are entered into the flexible budget once an accounting period has been completed, and it generates a budget that is specific to the inputs. The budget is then compared to actual expenses for control purposes. The steps needed to construct a flexible budget are:

  1. Identify all fixed costs and segregate them in the budget model.
  2. Determine the extent to which all variable costs change as activity measures change.
  3. Create the budget model, where fixed costs are “hard coded” into the model, and variable costs are stated as a percentage of the relevant activity measures or as a cost per unit of activity measure.
  4. Enter actual activity measures into the model after an accounting period has been completed. This updates the variable costs in the flexible budget.
  5. Enter the resulting flexible budget for the completed period into the accounting system for comparison to actual expenses.

This approach varies from the more common static budget, which contains nothing but fixed amounts that do not vary with actual revenue levels. Budget versus actual reports under a flexible budget tend to yield variances that are much more relevant than those generated under a static budget, since both the budgeted and actual expenses are based on the same activity measure. This means that the variances will likely be smaller than under a static budget, and will also be highly actionable.

A flexible budget can be created that ranges in level of sophistication. Here are several variations on the concept:

  • Basic flexible budget. At its simplest, the flexible budget alters those expenses that vary directly with revenues. There is typically a percentage built into the model that is multiplied by actual revenues to arrive at what expenses should be at a stated revenue level. In the case of the cost of goods sold, a cost per unit may be used, rather than a percentage of sales.
  • Intermediate flexible budget. Some expenditures vary with other activity measures than revenue. For example, telephone expenses may vary with changes in headcount. If so, one can integrate these other activity measures into the flexible budget model.
  • Advanced flexible budget. Expenditures may only vary within certain ranges of revenue or other activities; outside of those ranges, a different proportion of expenditures may apply. A sophisticated flexible budget will change the proportions for these expenditures if the measurements they are based on exceed their target ranges.

In short, a flexible budget gives a company a tool for comparing actual to budgeted performance at many levels of activity.

Advantages of Flexible Budgeting

The flexible budget is an appealing concept. Here are several advantages:

  • Usage in variable cost environment. The flexible budget is especially useful in businesses where costs are closely aligned with the level of business activity, such as a retail environment where overhead can be segregated and treated as a fixed cost, while the cost of merchandise is directly linked to revenues.
  • Performance measurement. Since the flexible budget restructures itself based on activity levels, it is a good tool for evaluating the performance of managers the budget should closely align to expectations at any number of activity levels.
  • Budgeting efficiency. Flexible budgeting can be used to more easily update a budget for which revenue or other activity figures have not yet been finalized. Under this approach, managers give their approval for all fixed expenses, as well as variable expenses as a proportion of revenues or other activity measures. Then the budgeting staff completes the remainder of the budget, which flows through the formulas in the flexible budget and automatically alters expenditure levels.

These points make the flexible budget an appealing model for the advanced budget user. However, before deciding to switch to the flexible budget, consider the following countervailing issues.

Disadvantages of Flexible Budgeting

The flexible budget at first appears to be an excellent way to resolve many of the difficulties inherent in a static budget. However, there are also a number of serious issues with it, which we address in the following points:

  • Formulation. Though the flex budget is a good tool, it can be difficult to formulate and administer. One problem with its formulation is that many costs are not fully variable, instead having a fixed cost component that must be calculated and included in the budget formula. Also, a great deal of time can be spent developing cost formulas, which is more time than the typical budgeting staff has available in the midst of the budget process.
  • Closing delay. A flexible budget cannot be preloaded into the accounting software for comparison to the financial statements. Instead, the accountant must wait until a financial reporting period has been completed, then input revenue and other activity measures into the budget model, extract the results from the model, and load them into the accounting software. Only then is it possible to issue financial statements that contain budget versus actual information, which delays the issuance of financial statements.
  • Revenue comparison. In a flexible budget, there is no comparison of budgeted to actual revenues, since the two numbers are the same. The model is designed to match actual expenses to expected expenses, not to compare revenue levels. There is no way to highlight whether actual revenues are above or below expectations.
  • Applicability. Some companies have so few variable costs of any kind that there is little point in constructing a flexible budget. Instead, they have a massive amount of fixed overhead that does not vary in response to any type of activity. For example, consider a web store that downloads software to its customers; a certain amount of expenditure is required to maintain the store, and there is essentially no cost of goods sold, other than credit card fees. In this situation, there is no point in constructing a flexible budget, since it will not vary from a static budget.

A flexible budget can be created that ranges in level of sophistication. Here are several variations on the concept:

  • Basic flexible budget. At its simplest, the flexible budget alters those expenses that vary directly with revenues. There is typically a percentage built into the model that is multiplied by actual revenues to arrive at what expenses should be at a stated revenue level. In the case of the cost of goods sold, a cost per unit may be used, rather than a percentage of sales.
  • Intermediate flexible budget. Some expenditures vary with other activity measures than revenue. For example, telephone expenses may vary with changes in headcount. If so, one can integrate these other activity measures into the flexible budget model.
  • Advanced flexible budget. Expenditures may only vary within certain ranges of revenue or other activities; outside of those ranges, a different proportion of expenditures may apply. A sophisticated flexible budget will change the proportions for these expenditures if the measurements they are based on exceed their target ranges.

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