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DISCOUNTING CASH FLOW ANALYSIS, ANNUITIES AND PERPETUITIES Learning Objectives: After going through this lecture, you would be able to have an understanding of the following concepts. Discounted Cash Flows (DCF Analysis) Annuities Perpetuity This lecture is continuation of the previous lecture’s topics. In the previous lecture, we had discussed the calculation of the Net Present [...]

After going through this lecture, you would be able to have an understanding of the following concepts. Financial Forecasting and Financial Planning. Methods of forecasting Before going into the detailed calculation of cash flow, it is important to know the principles behind financial forecasting and financial planning. Although, financial planning and forecasting cannot reduce the [...]

Financial Statements are like the Instrument panels of a business. There are different needs of different users of these statements. Users can be outside users and internal users. Identity of user is important, so as to provide him/her with relevant information. Financial statement analysis is the process of examining relationships among financial statement elements and [...]

Share Capital The maximum amount with which a company gets registration/incorporation is called authorized share capital of that company. This capital can be increased with the prior approval of security and exchange commission. This capital is further divided in to smaller denominations called shares. Each share usually has a face value equal to Rs. 10. [...]

These are integral part of the Financial Statements, which provide summary of accounting policies, adopted by Management in preparation of Accounts and preparing Financial Statements there from. These also present details about particular accounts (e.g. inventory, investments etc). Notes to Financial Statements also include other information e.g. leasing arrangements, pending legal proceedings, income taxes etc. [...]

Other steps in the Accounting Cycle after the preparation of Financial Statements are:- h) Closing entries in Accounting Cycle. As previously stated, revenues increase owner’s equity, and expenses and withdrawals by the owner decrease owner’s equity. If the only financial statement that we needed was a balance sheet, these changes in owner’s equity could be [...]

If a voltage across a conductor is app proportional to the ‘voltage’ i.e. V α I V=IR differen Volt (V) is the practical unit of potential difference & Ohm (Ω) for Resistance, therefore, Ampere=Volts/Ohms This Formula us, to calce Am ‘R’ by the Ohm It is important to realize that with high voltage the Current [...]

VOLT This unit is named after Alessandro Volta. Fundamentally, the volt is the measure of the work needed to move an electric charge. When 0.7376 foot-pound of work is required to move 6.25×1018 electrons between two points, each with its own charge , the potential difference is one. 6.25×1018 electrons make up one coulomb . [...]

We see the effects of electricity in a battery, static charge, lighting, radio, television, and many other applications. What do they all have common, that is electrical in nature ? The answer is basic particles of opposite polarity. As we studied in the last lecture, all the materials, including solids, liquids, and gases, contain two [...]

Lack of coordination results in confusion and uncertainty. On the other hand, performance is inversely proportional to the amount of communication and hence too much communication and coordination is also not healthy for the project. Very large projects are best addressed with CC or CD when sub-grouping can be easily accommodated. Kraul and Steeter categorize [...]

Software Engineers always confront with the challenge to make a good balance of all these tings depending on the requirements of the particular software system at hand. He should analyze how much weight should all these things get such that it will have acceptable quality, acceptable performance and will have acceptable user-interface. In some software [...]

Software Engineering is actually the balancing act. You have to balance many things like cost, user friendliness, Efficiency, Reliability etc. You have to analyze which one is the more important feature for your software is it reliability, efficiency, user friendliness or something else. There is always a trade-off among all these requirements of software. It [...]

When the MagSafe power adapter isn’t connected, your MacBook Pro draws power from its built-in battery. The length of time that you can run your MacBook Pro varies, depending on the applications you use and the external devices connected to your MacBook Pro. Turning off features such as AirPort Extreme or Bluetooth® wireless technology and [...]

Graphics Applications Due to rapid growth in the field of computing, now computer is used as an economical and efficient tool for the production of pictures. Computer graphics applications are found in almost all areas. Here we will discuss some of the important areas including: User Interfaces Almost all the software packages provide a graphical [...]

Showing and Uninstalling Programs In the following chapters, you will find out how you can use TuneUp Uninstall Manager to display the programs installed on your computer, why you might want to uninstall them and how to do so: Showing and Uninstalling Programs -Introduction Over time, you accumulate a large number of programs on your [...]

Organizing Files and Folders The chapters that follow explain how you can use the TuneUpDisk SpaceExplorer tool to obtain a rapid overview of the space taken up on your hard disks, in order to clean them up quickly and efficiently: Showing and Organizing Files and Folders -Introduction The capacity of modern hard disks and memory [...]

Configuring Live Optimization In the following chapters, you will find out whyit is important todoso and how you can increase your computer’s performance by turning on the TuneUpLiveOptimization: Configuring Live Optimization -Introduction TuneUpLiveOptimization consists of two intelligent optimization methods that monitor the load your computer is under in real time and can thereby intervene if [...]

Flow Control- Explanation a.                   Any receiving device has a limited speed at which it can process incoming data and a limited amount of memory in which to store incoming data b.                   The receiving device must be able to inform the sending device before those limits are reached and to request that the TX device send [...]

Presentation and Disclosure Requirements of Financial Statements – Revision (Contd) Disclosure Requirements – IAS 02 The accounting policy adopted The total carrying amount and the carrying amount in classification appropriate to the enterprise. The carrying amount of the inventories carried at NRV. The amount of any reversal of any write down that is recognized as [...]

Presentation and Disclosure Requirements of Financial Statements – Revision Balance Sheet Disclosure Requirements of Share Capital Share capital classified under the following sub-heads, namely: Issued, subscribed and paid up capital, distinguishing in respect of each class between:- (a) Shares allotted for consideration paid in cash; (b) Shares allotted for consideration other than cash, showing separately [...]

IAS-33 Earnings per Share & Financial Statements Diluted EPS • At the end of an accounting period, a company may have in issue some securities which do not (at present) have any claim to a share of equity earnings, but may give rise to such a claim in the future. These securities include. a) A [...]

Statement of Changes in Equity, Accounting Policies, Changes in Accounting Estimates and Errors Statement of Changes in Equity – IAS 1 1. Statement of changes in equity shows the movement in the elements of equity during the reporting period. 2. An entity shall present a statement of changes in equity showing on the face of [...]

Revenues IAS 18 Definition – IAS 18 • The IAS defines Revenue as ‘Revenue is the gross inflow of economic benefits during the period arising in the course of ordinary activities of an entity when those inflows result in increases in equity, other than increases relating to contributions from equity participants. Identification of Transaction Normally, [...]

Provisions, Contingent Assets & Contingent Liabilities (Contd) Accruals are liabilities to pay for goods or services that have been received but have not been paid, invoiced or formally agreed with the supplier including amounts due to employees. Although it is sometimes necessary to estimate the amount or timing of accrual, the uncertainty is generally much [...]

Leasing – IAS 17 (Contd.) & Provisions, Contingent assets and Contingent Liabilities IAS 37 Security Deposit200,000 IRR p.a.15%Principal Outstanding571,000 (771,000 – 200,000)LeaseFinancialPrincipalPrincipalRentalChargesOutstanding571,000 1 173,915 – 173,915 397,085 2 173,915 59,563 114,352 282,733 3 173,915 42,410 131,505 151,228 4 173,915 22,687 151,228 – 695,660 124,660 571,000 Rental inRental inAdvanceArrearsIRR15%15%Loan Amount(771,000) (771,000) Security Deposit200,000 200,000 First Rental173,915 [...]

Leasing – IAS 17 (Contd.) Finance Lease – IAS 17 Lessee should recognize finance lease as asset and liabilities in their balance sheets at amounts equal at the  inception of the lease to the fair value of the leased property or, if lower, at the present value of the minimum lease payments. In calculating the [...]

Leasing – IAS 17 (Contd.) Sale and Lease Back Under this type of transaction, the holder of an asset sells it to another party and then immediately leases it back again. Both the lease payments and the sale price are interdependent upon each other because they are negotiated as a package. As the sale is [...]

Leasing – IAS 17 Lease (IAS-17) Where goods are acquired other than on immediate cash terms, arrangements have to be made in respect of the future payments on those goods. In the simplest case of credit sales, the purchaser is allowed a period of time (say one month) to settle the outstanding amount and the [...]

Repurchase of Shares – Section 95 A Following are the requirements and condition of repurchase of shares: Special resolution, indicating the maximum number of shares to be repurchased and the maximum price to be offered. The purchase shall be in cash and out of the distributable profits. In case of purchase at premium the amount [...]

Presentation of Liabilities in Balance Sheet In our earlier lectures we have covered the assets side of the balance sheet. We will now start the liabilities side of balance sheet. You will remember that we had shown you a sample balance sheet. Let’s have a re-look at it just to refresh our memory and then [...]