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US CMA | CMA USA Part II Corporate Finance subject details

US CMA | CMA USA Part II Corporate Finance

US CMA | CMA USA Part II Corporate Finance-Before going into that lets know a little bit about CA in USA- Founded in 1887, the AICPA represents the CPA profession nationally regarding rule-making and standard-setting, and serves as an advocate before legislative bodies, public interest groups and other professional organizations. The AICPA develops standards for audits of private companies and other services by CPAs; provides educational guidance materials to its members; develops and grades the Uniform CPA Examination; and monitors and enforces compliance with the profession’s technical and ethical standards.

 The AICPA’s founding established accountancy as a profession distinguished by rigorous educational requirements, high professional standards, a strict code of professional ethics, a licensing status and a commitment to serving the public interest.

Corporate Finance covers about 20% weight of the whole syllabus

US CMA | CMA USA Part II Corporate Finance

The below topics are to be followed for effective preparation in level C:

Types of risk; including credit, foreign exchange, interest rate, market, and political risk; capital instruments for long-term financing; initial and secondary public offerings; dividend policy; cost of capital; working capital management; raising capital; managing and financing working capital; mergers and acquisitions; and international finance.

Suggested Reading List is listed as follows:

  1. Brealey, Richard, A., Myers, Stewart C., and Allen, Franklin, Principles of Corporate Finance, 10th edition, McGraw Hill, New York, NY, 2011.
  2. Van Horn, James, C., and Wachowicz, John M. Jr., Fundamentals of Financial Management, 13th edition, FT / Prentice Hall, Harlow, England, 2009.

US CMA | CMA USA Part II Corporate Finance

The following are the Content Specification Outlines

1. Risk and return

The riskreturn spectrum (also called the riskreturn tradeoff or risk–reward) is the relationship between the amount of return gained on an investment.

a. Calculating return

b. Types of risk

c. Relationship between risk and return

2. Long-term financial management

Financial management refers to the efficient and effective management of money (funds) in such a manner as to accomplish the objectives of the organization.

a. Term structure of interest rates

b. Types of financial instruments

c. Cost of capital

d. Valuation of financial instruments

3. Raising capital

Raising Capital refers to obtaining capital from investors or venture capital sources.

a. Financial markets and regulation

b. Market efficiency

c. Financial institutions

d. Initial and secondary public offerings

e. Dividend policy and share repurchases

f. Lease financing

4. Working capital management

Decisions relating to working capital and short-term financing are referred to as working capital management. These involve managing the relationship between a firm’s short-term assets and its short-term liabilities. The goal of working capital management is to ensure that the firm is able to continue its operations and that it has sufficient cash flow to satisfy both maturing short-term debt and upcoming operational expenses.

a. Working capital terminology

b. Cash management

c. Marketable securities management

d. Accounts receivable management

e. Inventory management

f. Types of short-term credit

g. Short-term credit management

5. Corporate restructuring

Restructuring is the corporate management term for the act of reorganizing the legal, ownership, operational, or other structures of a company for the purpose of making it more profitable, or better organized for its present needs. Other reasons for restructuring include a change of ownership or ownership structure, demerger, or a response to a crisis or major change in the business such as bankruptcy, repositioning, or buyout. Restructuring may also be described as corporate restructuring, debt restructuring and financial restructuring.

a. Mergers and acquisitions

b. Bankruptcy

c. Other forms of restructuring

6. International finance

International finance (also referred to as international monetary economics or international macroeconomics) is the branch of financial economics broadly concerned with monetary and macroeconomic interrelations between two or more countries

a. Fixed, flexible, and floating exchange rates

b. Managing transaction exposure

c. Financing international trade

d. Tax implications of transfer pricing

US CMA | CMA USA Part II Corporate Finance

CMA EXAM

RATIO DEFINITIONS

Following are some of the useful abbreviations

  • EBIT = Earnings before interest and taxes
  • EBITDA = Earnings before interest, taxes, depreciation and amortization
  • EBT = Earnings before taxes
  • EPS = Earnings per share
  • ROA = Return on assets
  • ROE = Return on equity

US CMA | CMA USA Part II Corporate Finance

US CMA | CMA USA Subject wise Weightage :   Once you have received authorization from ICMA, it is your responsibility to schedule your appointment at a Prometric Testing Center. Log onto www.prometric.com/ICMA to locate a testing center, schedule, confirm, reschedule, or cancel your appointment 24 hours, 7 days a week. Instructions are provided by ICMA at the time your authorization letter is emailed that provides further options for scheduling. ICMA is not responsible if you delay scheduling and there are no longer appointments available within your authorization period. You will be given a confirmation number at the time you schedule an appointment; you should make a note of this number. If you do not schedule an appointment or you don’t appear for a schedule appointment in the selected testing window, you will forfeit your exam fee.

The CMA examination is given in a computer-based format, and is offered at Prometric Testing Centers located throughout the world. An up-to-date listing of all Prometric Testing Centers can be found at Prometric’s website. www.prometric.com/ICMA. Parts 1 and 2 are offered during the following three testing windows. January/February May/June September/October Registrations for Parts 1 and 2 will close on or after the 15th of February, June, and October. Register for the exam: 1. On-line at the online store. 2. Calling 800-638-4427, or (201) 573-9000 with your credit card information.

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