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Cfm 310: Issues In Financial Management Question Paper

Cfm 310: Issues In Financial Management

Course:Bachelor Of Commerce

Institution: Kca University question papers

Exam Year:2009

1
UNIVERSITY EXAMINATIONS: 2009/2010
THIRD YEAR STAGE 2 EXAMINATION FOR THE DEGREE OF
BACHELOR OF COMMERCE
CFM 310: ISSUES IN FINANCIAL MANAGEMENT (SUNDAY CLASS )
DATE: DECEMBER 2009 TIME: 2 HOURS
INSTRUCTIONS: Answer Question ONE and Any other TWO Questions
QUESTION ONE [30 MARKS]
a) Explain any three objectives of portfolio management [3 Marks]
b) Distinguish between Active Management Strategy and Passive management Strategy
[8 Marks]
c) Write brief notes on the following
i) Rebalancing [4 Marks]
ii) Risk profiling [4 Marks]
iii) Asset classes [4 Marks]
d) Explain the Interorganisational Information Systems (IOS)in the context of e-commerce
[7 Marks]
QUESTION TWO [20 MARKS]
a) Businesses essentially operate in a complex turbulent business environment characterized by
increased competition, change and uncertainty. Explain any five organisational responses that
can be adopted by affected businesses. [10 Marks]
b) Explain the key steps for undertaking a successful Merger and an Acquisition Program
[10 Marks]
2
QUESTION THREE [20 MARKS]
a) It is advisable that one should never pursue an acquisition deal unless the background
paperwork comes up perfectly clean. Identify and explain any five signals of a failed merger
[10 Marks]
b) Explain the following restructuring terms
i) Spin-offs [ 2 Marks]
ii) Split-offs [ 3 Marks]
iii) Split-ups [ 2 Marks]
iv) Tracking Stock [ 3 Marks]
QUESTION FOUR [20 MARKS]
a) Explain the rationales for making acquisitions [12 Marks]
b) With the help of illustrations distinguish between Financial restructuring and Asset
restructuring [8 Marks]
QUESTION FIVE [20 MARKS]
a) Before an investment portfolio can be constructed, one has to make accurate assessment of the
life cycle phase in which the individual investor is. With the help of a diagram, explain the four
phases of this cycle [10 Marks]
b) Explain the four facets of corporate Restructuring [10 Marks]

Cfm 310: Issues In Financial Management Question Paper

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