Bachelor of Business Administration (BBA)

Semester Course Code Credits Hours Course Name

V BBAFINSC505 3 45 International Finance

Course Objectives:
 To study concepts, theory and practices in the area of International Finance
 To illustrate different issues in cross border transactions related to International trade and
investments
 To analyze cost of raising funds and cost of risk management.
 To evaluate various risk management strategies.
 To study different sources of raising finance for international Business activities

Course Outcomes:
The student will be able to:
 Describe the functioning of International markets
 Evaluate the nature of Forex markets, International risk management and hedging
instruments.
 Compare and contrast different instruments used in the forex markets.

Syllabus:

Unit No. Topic Hours

1. Overview of Financial Management in International context, Country
& Political risk:-
 Exchange rate risk
 Interest rates
 Inflation rates 5
Foreign Exchange Markets:-
 Spot and Forwards Exchange Rates
Eurocurrency and Domestic Interest Rates
International Monetary system
2. The Foreign exchange market 10
 Types of transactions
 Exchange rate quotations and Arbitrage
Forecasting Exchange Rates determination and forecasting
 Structural model of exchange rate determination
Time Series Forecasting Models
Foreign Exchange Risk Management
Exposure Management- Operating, Transaction and Translation
Hedging & speculation
Managing exposure to exchange rate fluctuation
Management of Interest rate Exposure FRA (forward rate
 agreements), Interest rate caps and floors

International Capital Market

 International capital and money markets
 International Bond Market
 International Equity Market
International Sources of funds
 Bond Financing (Fixed and Floating Rate Notes)
3.  Loan Financing (Syndicated Loans)
 Securitised Financing (Euronote)
12
 Equity Financing (GDR and ADR)
 Loan Agreements
International Financing Decision
 Issues in Overseas Funding Choices
 Economic Circumstances and overall Funding Choices
 Funding and Risk Management Aspects

International Capital Budgeting, Cost of Capital of a Foreign 8

Investment
Financial swaps and currency derivatives
 Currency Forwards
4.  Currency Options
 Currency Futures
 Currency Swaps
 Interest Rate Risk Management

Global Asset Management:-

 Current Asset Management
 International Portfolio Investment
 Foreign direct investment strategy
 Multinational capital expenditure analysis
5.  Political risk Management 10
Global Reporting and Controlling
 Multinational accounting
 International Taxation
 International transfer pricing
Case Studies

Books Recommended

 Multinational Financial Management: Allen Shapiro

 Multinational Business Finance: Eitman Stonehill, Pearson
 International Corporate Finance :Madura Jeff, Thompson Learning, New Delhi
 Options, Futures and other Derivatives :John C Hull, Prentice-Hall of India, New Delhi
 International Finance: Apte P.G, Tata McGraw- Hill, New Delhi.