Overview

Introduction to Corporate Finance — how this chapter fits your Maharashtra HSC Secretarial Practice paper

Introduction to Corporate Finance is Chapter 1 of the Maharashtra State Board (MSBSHSE) Std XII Secretarial Practice syllabus, and it opens the corporate-finance strand that runs through the entire Std XII HSC Commerce Secretarial Practice course — shares, debentures, deposits, dividend, the depository system, and the financial market all build on the ideas this chapter first sets out. Before a company can issue a single share or pay a single rupee of dividend, it must first raise, allocate, and manage money — and that whole activity is what 'corporate finance' means.

This chapter covers, in order: (1) the meaning and definition of corporate finance; (2) how the subject has evolved and what its scope covers today; (3) why corporate finance matters and the three core functions — the financing decision, the investment decision, and the dividend decision — through which a company actually manages its money; and (4) the company's capital requirements, split into fixed capital and working capital, the factors that decide how much of each a company needs, and how the two are distinguished from one another.