KIIT LAW SCHOOL

Corporate Finance
Poject on
Working Of Financial Manager
Of Tata Communication
Subbmited to- Mr.R.K Nanda Submitted By:-Rohit Kumar
Assistant Professor Roll No:-1582076
KIIT Law School BBALLB(B)

Acknowledgment
Every project big or small is successful largely due to the effort of a number of
wonderful people who have always given their valuable advice or lent a helping hand.
I sincerely appreciate the inspiration; support and guidance of all those people who
have been instrumental in making this project a success.

I, Rohit Kumar(1582076), the student of KIIT LAW SCHOOL (BBALLB), am

extremely grateful to You for the confidence bestowed in me and entrusting my
project.

At this juncture I feel deeply honored in expressing my sincere thanks to Mr. R.K
Nanda Sir for making the resources available at right time and providing valuable
insights leading to the successful completion of my project.

I would also like to thank all the faculty members of college for their critical advice
and guidance without which this project would not have been possible.

Last but not the least I place a deep sense of gratitude to my friends who have
been constant source of inspiration during the preparation of this project work.
 YOUR NAME – Rohit Kumar

Introduction

Business concern needs finance to meet their requirements in the economic world.
Any kind of business activity depends on the finance. Hence, it is called as lifeblood
of business organization. Whether the business concerns are big or small, they need
finance to fulfil their business activities. In the modern world, all the activities are
concerned with the economic activities and very particular to earning profit through
any venture or activities. The entire business activities are directly related with
making profit. (According to the economics concept of factors of production, rent
given to landlord, wage given to labour, interest given to capital and profit given to
shareholders or proprietors), a business concern needs finance to meet all the
requirements. Hence finance may be called as capital, investment, fund etc., but each
term is having different meanings and unique characters. Increasing the profit is the
main aim of any kind of economic activity.

MEANING OF FINANCE

Finance may be defined as the art and science of managing money. It includes
financial service and financial instruments. Finance also is referred as the provision of
money at the time when it is needed. Finance function is the procurement of funds and
their effective utilization in business concerns. The concept of finance includes capital,
funds, money, and amount. But each word is having unique meaning. Studying and
understanding the concept of finance become an important part of the business
concern.
 History of Tata Communication

Tata Communications is a global company with its roots in the emerging markets.
Headquartered in Mumbai and Singapore, it has more than 8500 employees across
38 countries. The $3.2 billion company is listed on the Bombay Stock Exchange and
the National Stock Exchange of India and is the flagship telecoms arm of the $103.3
billion Tata Group.

Over the past few years technology has caused significant changes in the way
enterprises conduct business.

The exponential growth of connected devices, emergence of social media, analytics,

and cloud computing (SMAC), and acceptance of bring your own device (BYOD), are
all resulting in a major transition in the way enterprises engage with technology.
Both developed and emerging economies are looking to innovation in technology. As
a key enabler of information and communication technologies to global enterprises,
Tata Communications has led from the front in ensuring a robust digital ecosystem
that is equipped for the future – with the infrastructure that can cope with customers’
demands of intelligence, scalability and flex

Tata Communications’ enhanced business strategy has the consumer’s requirements,

trends and movements at the heart of everything it does. It seeks to create an open
infrastructure, partner ecosystem and platform that is fit for business and delivers that
‘just works’ experience, whilst retaining the transparency, flexibility and control that
CEO/CIO’s require in order to safeguard and enhance their organisations’ customer
experience and brand reputation. All of this is overlaid onto years of investment and
infrastructure through its $1.19 billion investment in the world’s only wholly owned
subsea fibre network that circles the globe.Tata Communications’ services portfolio
includes predictable high speed connections and global MPLS virtual private
networks, Telepresence services, DDoS mitigation and detection service, content
delivery networks and cloud offerings. Tata Communications offers customised
network solutions for customers in key markets – including verticals like
manufacturing, oil and gas, banking, financial services and insurance, and media and
entertainment – offering our customers speed, quality and unparalleled network reach

Objectives of Finance manager of TATA communication

Support Accounting
Financial management has an objective to support the company’s
accounting department. Financial managers do not usually complete everyday
accounting functions. They typically review the information from the accounting
department and review this information for accuracy and validity. Corrective
measures or suggestions can be made to improve the company’s
accounting information. Accounting information plays an important role in small
business. Business owners often use accounting information to secure external
financing from banks, lenders and investors.
Provide Decision Information
Business owners often require financial or accounting information when making
business decisions. One objective of financial management is to provide business
owners and other individuals with information for making business decisions.
Information must be useful, relevant and accurate. Financial managers are usually an
intermediary between the business owner and other operational managers. This saves
the business owner time and effort from wading through extensive information with
no relation to the decision at hand.
Risk Management
Risk management is often a primary objective for financial management functions in
larger business organizations. Risk management ensures companies do not face undue
pressure or risk from various financial situations. Financial rooms can result from
business opportunities providing inadequate financial returns, debt financing with
unfavorable loan terms, lack of available business credit and unstable financial
investments. Financial managers often spend copious amounts of time reviewing their
company’s financial activities to ensure the least amount of risk is
absorbed by the company.
Improve Operational Controls
Financial management has a responsibility to improve operational controls and
workflow. Financial managers often review information from several divisions or
departments within their company. The focus of this review process ensures company
employees are operating within standard company guidelines. Financial managers can
make suggestions to business owners for improving the company’s
controls and business operations. These suggestions outline specific objectives for
reducing waste, limiting unnecessary expenditures and improving employee
productivity. Each objective can help business owners improve their
company’s overall financial operation

Function of Financial manager

1.Estimating the Amount of Capital Required:
This is the foremost function of the financial manager. Business firms require capital
for:
i) purchase of fixed assets,

(ii) meeting working capital requirements, and

(iii) modernisation and expansion of business.

2. Determining Capital Structure:

Once the requirement of capital funds has been determined, a decision regarding the
kind and proportion of various sources of funds has to be taken. For this, financial
manager has to determine the proper mix of equity and debt and short-term and
long-term debt ratio. This is done to achieve minimum cost of capital and maximise
shareholders wealth.

3. Choice of Sources of Funds:

Before the actual procurement of funds, the finance manager has to decide the sources
from which the funds are to be raised. The management can raise finance from
various sources like equity shareholders, preference shareholders, debenture- holders,
banks and other financial institutions, public deposits, etc.

4. Procurement of Funds:
The financial manager takes steps to procure the funds required for the business. It
might require negotiation with creditors and financial institutions, issue of prospectus,
etc. The procurement of funds is dependent not only upon cost of raising funds but
also on other factors like general market conditions, choice of investors, government
policy, etc.

5. Utilisation of Funds:
The funds procured by the financial manager are to be prudently invested in various
assets so as to maximise the return on investment: While taking investment decisions,
management should be guided by three important principles, viz., safety, profitability,
and liquidity.

6. Disposal of Profits or Surplus:

The financial manager has to decide how much to retain for ploughing back and how
much to distribute as dividend to shareholders out of the profits of the company. The
factors which influence these decisions include the trend of earnings of the company,
the trend of the market price of its shares, the requirements of funds for self- financing
the future programmes and so on.

7. Management of Cash:
Management of cash and other current assets is an important task of financial
manager. It involves forecasting the cash inflows and outflows to ensure that there is
neither shortage nor surplus of cash with the firm. Sufficient funds must be available
for purchase of materials, payment of wages and meeting day-to-day expenses.

8. Financial Control:
Evaluation of financial performance is also an important function of financial
manager. The overall measure of evaluation is Return on Investment (ROI). The other
techniques of financial control and evaluation include budgetary control, cost control,
internal audit, break-even analysis and ratio analysis. The financial manager must lay
emphasis on financial planning as well.
 Role of Financial manager

Role 1: An EFFECTIVE MEMBER of the MANAGEMENT TEAM

 Effective leader and supervisor on the management team, meeting own objectives
while simultaneously helping other managers achieve their goals.
 Target and assign all significant responsibilities.
 Ensure the company’s profitability, liquidity, and solvency; making sure it earns
the maximum return on liquid assets and incurs minimum expenses on borrowed
capital Ensure that margins on jobs are maximized through cost recovery.
 Forecast financial future and anticipate monetary needs of company, maintaining
its creditworthiness.
 Report the company’s financial condition, operations, contingencies, and
opportunities accurately and completely.
 Internal and external financial reporting. • Monitor and forecast the company’s
financial status. • Establish and maintain internal accounting controls

Role 2: A MOTIVATIONAL ADMINISTRATOR of the FINANCE DEPT.

 Hire, train, and motivate Finance Department employees.
 Organize and accurately assign responsibilities, gauging the skills of staff
members.
 Ensure that the Finance Department is an asset to all other departments.
 Use training as a motivational tool to increase the skills of others.
 Appreciate and encourage the work of staff members, increasing productivity.

Role 3: A RESPONSIBLE REPRESENTATIVE of YOUR EMPLOYER &

LIAISON to CREDITORS
 Represent company in financial matters, effectively communicating information.
 Ensure that all company assets are safe from theft and misappropriation. • Act on
employers’ behalf in general, going beyond technical tasks and financial
reporting to include all areas of management.
 Maintain strong company relationships with banks and sureties.
 Comply with the terms of agreement between the bank and contractor. • Identify
competitive rates and fees by researching the competition.
 Ensure that the company’s project control system is operating properly and that
sureties are familiar with it.
 Establish a strong financial and operational reporting system with sureties.

Role 4: An ADMINISTRATOR RESPONSIBLE for INSURANCE, INCOME

TAX, LEGAL, HR, SAFETY & IT
 Obtain insurance coverage, such as liability, property, worker’s compensation,
and course-of-construction insurance
 .Manage company’s income tax planning and compliance.
 Keep track of outstanding litigation.
 Minimize company’s exposure to liability claims and property damage. • Ensure
contracts receive the proper review and approval by management. • Establish
reporting system to ensure contract compliance.
 Efficient HR administration on a company-wide basis, ensuring employment
policies are consistent with applicable laws.
 Comply with collective bargaining agreements.

Role 4: An ADMINISTRATOR RESPONSIBLE for INSURANCE, INCOME

TAX, LEGAL, HR, SAFETY & IT (con’t)
 Implement aggressive safety management to secure employee and environmental
safety.
 Responsible for company’s IT function, providing IT services to various
departments.
 Work on tasks pertaining to leases, subleases, and property and sales tax returns.
 Contribute to company profitability via property management.

Role 5: A MODEL of INTEGRITY with HIGH ETHICAL STANDARDS

 Exercise fair dealing and honest, independent judgment.
 Avoid conflicts of interest and the appearance of conflicts.
 Resolve ethical dilemmas with company owners
 Disclose issues that affect company to bankers and sureties
 Set an ethical standard for coworkers that exceeds legal requirements.
 Responsibilities Of financial manager

An essential function of every finance-related job on the campus is to safeguard the

assets of the university through the development and implementation of a solid
structure of internal control. Such a structure consists of policies and procedures
designed to provide reasonable assurance that specific departmental and university
objectives will be achieved.

1. Records Management
Records management at CU-Boulder follows guidelines and schedules articulated by
Colorado State Archives, directives issued by various state and federal agencies, and
other authoritative entities. Information about the management of financial records at
CU-Boulder is contained in the Retention of University Records APS and its
accompanying Records Retention Schedule.
These two documents largely follow the Colorado State Archives Records
Management Manual, which provides uniform disposition standards for records
common to all state agencies. The recommendations contained therein have been
incorporated in CU-Boulder’s retention schedule cited above.

2. Source Documents:
Organization and Filing Getting source documents organized and placed into files
(paper or digital) serves as the foundation for staying in control of departmental
finances. With a good filing system in place, answering questions such as, “How
much money is available to spend on travel in a certain FOPPS?” or, “When will that
equipment be delivered?” become a breeze.
The first step in getting organized is to set up a system that will provide convenient
access to essential information. Source documents, invoices, receipts, and financial
statements should each have a place to call home.

3.Develop Departmental Procedures for Each Financial Process

The financial processes with which a department is typically involved include cash
handing, journal entry preparation, and budget journal preparation. Procedures should
be developed to administer each of these processes so that the assets of the university
are safeguarded, and reasonable assurance is provided that the university's objectives
will be achieved. At a minimum, each procedure should incorporate the elements of
proper authorization, segregation of duties, and maintenance of documents and
records.

4.Provide Regular Reporting to Management

The employee who is responsible for maintaining the department's financial records,
doing the monthly reconciliation of the departmental FOPPS, and performing the
quarterly monitoring of the financial statements, must communicate information about
the department's financial condition with management.The Reporting System
provides online financial reports to every employee—management included—who
has a fiscal role. You might assume that the right people are getting needed
information and acting upon it. Ideally, this is true. However, if you notice anything
unusual or that deserves a closer look, do not hesitate to bring this up to management.
Be proactive—don’t assume that the problem was detected.

Financial Planning
Financial Planning is an ongoing process to help you make sensible decisions about
money that can help you achieve your goals in life; it's not just about buying products
like a pension or an ISA.

Finance is an important function of business. The application of planning to this

function is called financial planning. Financial planning is mainly concerned with the
economical procurement and profitable use of funds. According to Gutlman and
Dougall, “Financial planning is concerned with raising, controlling and administering
of funds used in business.” In the words of Bouneville and Dewey, “Financial
planning consists in the raising, providing and managing of all the money, capital of
funds of any kind to be used in connection with the business.” Financial planning is
an important element of the overall planning of business enterprise. Financial
planning includes the following:

 Estimating the amount of capital required for financing the business enterprise;
 Determining capital structure;
 Laying down policies for the administration of capital;
 Formulating the programmes to provide the most effective use of capita
 Steps of financial planning
·
1. Establishing and defining the client-planner relationship - The financial
planner explains or documents the services to be provided and defines his or her
responsibilities along with the responsibilities of the client. The planner explains
 how he or she will be paid and by whom. The planner and client should agree on
how long the relationship will last and on how decisions will be made.
2. Gathering client data and determining goals and expectations - The financial
planner asks about the client's financial situation, personal and financial goals and
attitude about risk. The planner gathers all necessary documents at this stage
before giving advice.
3. Analyzing and evaluating the client's financial status - The financial planner
analyzes client information to assess his or her current situation and determine
what must be done to achieve the client's goals. Depending on the services
requested, this assessment could include analyzing the client's assets, liabilities
and cash flow, current insurance coverage, investments or tax strategies.
4. Developing and presenting the financial planning recommendations and/or
alternatives - The financial planner offers financial planning recommendations
that address the client's goals, based on the information the client provided. The
planner reviews the recommendations with the client to allow the client to make
informed decisions. The planner listens to client concerns and revises
recommendations as appropriate.
5. Implementing the financial planning recommendations - The financial planner
and client agree on how recommendations will be carried out. The planner may
carry out the recommendations for the client or serve as a "coach, " coordinating
the process with the client and other professionals such as attorneys or
stockbrokers.
6. Monitoring the financial planning recommendations - The client and financial
planner agree upon who will monitor the client's progress toward goals. If the
planner is involved, he or she should report to the client periodically to review the
situation and adjust recommendations as needed.
 Types of financial planning

There are three types of financial plans, viz.,

 Short-term financial plan is prepared for maximum one year. This plan looks after
the working capital needs of the company.
 Medium-term financial plan is prepared for a period of one to five years. This
plan looks after replacement and maintenance of assets, research and
development, etc.
 Long-term financial plan is prepared for a period of more than five years. It looks
after the long-term financial objectives of the company, its capital structure,
expansion activities, etc.
 Factors Affecting financial planning
Nature of the industry
The very first factor affecting the financial plan is the nature of the industry. Here, we
must checkwhether the industry is a capital intensive or labour intensive industry.
This will have a major impact on the total assets that a firm owns.
Size of the company
The size of the company greatly influences the availability of funds from different
sources. A small company normally finds it difficult to raise funds from long term
sources at competitive terms. On the other hand, large companies like Reliance enjoy
the privilege of obtaining funds both short term and long term at attractive rates.

Status of the company in the industry

A well established company enjoys a good market share, for its products normally
command investors’ confidence. Such a company can tap the capital market for
raising funds in competitive terms for implementing new projects to exploit the new
opportunities emerging from changing business environment.

Sources of finance available

Sources of finance could be grouped into debt and equity. Debt is cheap but risky
whereas equity is costly. A firm should aim at optimum capital structure that
would achieve the least cost capital structure. A large firm with a diversified product
mix may manage higher quantum of debt because the firm may manage higher
financial risk with a lower business risk. Selection of sources of finance is closely
linked to the firm’s capability to manage the risk exposure.

The capital structure of a company

The capital structure of a company is influenced by the desire of the existing
management (promoters) of the company to retain control over the affairs of the
company. The promoters who do not like to lose their grip over the affairs of the
company normally obtain extra funds for growth by issuing preference shares and
debentures to outsiders.

Matching the sources with utilization

The prudent policy of any good financial plan is to match the term of the source with
the term of the investment. To finance fluctuating working capital needs, the firm
resorts to short term finance. All fixed asset – investments are to be financed by long
term sources, which is a cardinal principle of financial planning.

Government policy
SEBI guidelines, finance ministry circulars, various clauses of Standard Listing
Agreement and regulatory mechanism imposed by FEMA and Department of
corporate affairs (Govt. of India) influence the financial plans of corporates today.
 CONCLUSION

IMPLEMENTATION (TAKING CORRECTIVE ACTION)

To this point the financial planning data has been gathered and analyzed, financial
planning statements have been created, goals and objectives have been measured and
financial gaps found.

The next step in the financial planning process is implementing the financial plan’s
recommendations. Though this is not the last step in the process, most of the hard
work is behind you. With that said, the best financial plan is worthless if it is not
implemented.

Financial Planning Action Plan

To help with the implementation of a financial plan, many Advisors will create an
“Action Plan”. Your financial planning action plan should include all of the tasks that
you will need to accomplish in order to improve your financial situation.

Recommended Action – Your action plan is a list of all of the recommendations that
you should accomplish in order to strengthen your financial plan. There are two ways
of looking at your list. Depending on the situation you can list them by importance or
chronologically (desired date of accomplishment).

Purpose of Accomplishing Goal – Next your financial planning action plan should
include a description of what the recommended action accomplishes. This helps
communicate the importance of accomplishing the recommendation and provides a
audit trail of sorts. This will come in handy if you change financial planners or want
to refresh your financial plan.
Target Date – All great goals and objectives are time driven. This means choosing a
reasonable amount of time in which to implement the recommendation. This is the
easiest way to keep everyone on track.

Finding Professionals and Specialists

When implementing a financial plan you will probably need to rely on the expertise of
a few specialists. These professionals can help you draft legal documents, find the
right service for your needs and help leverage a specific program or opportunity.

Certified Public Accountant – A CPA can help with the preparation of financial
statement and budgets. In addition they will also help prepare your taxes and suggest
opportunities to reduce your tax liability.

Insurance and Brokerage Services – Insurance and investing are two pillars of
sound financial planning. As part of your financial planning action plan you many
need to open a brokerage account and request a consultation from a insurance
professional.

Estate Planning Lawyers – Estate planning is predominately based in law and

property rights. Finding a good Lawyer will help you navigate the complexities of the
law and help determine the best services for your situation.

Automate as Much as Possible

I have always been a fan of making life simple. This is why I try to automate as much
of my budget as possible. Automating a budget is extremely easy thanks to online
banking and direct deposit. When you choose to implement one of the most
challenging parts of your financial plan, the budget, you are increasing the probability
of financial success. I discuss a little about how to automate a budget in my post about
managing household finances.

Implementing a financial plan takes a lot of discipline and sometimes a little help
from specialists. Ensure that your action plan includes the recommendation, its
purpose and an accomplishment date.
 Index

1. Introduction

2. History of Tata Communication

3. Objectives of Finance manager of TATA communication

4. Function of Financial manager

5. Responsibilities Of financial manager

6. Financial Planning

7. Steps of financial planning

8. Types of financial planning

9. Factors Affecting financial planning

10. CONCLUSION