Q.1.

Define Consultancy and Financial services provided in India with two

examples each. Types of consultants
Consultancy Services are those services delivered by an independent contractor
(individual entity or firm) who is not on your organizations payroll and who offers its
services to the public. Consulting services refers to the practice of helping
districts to improve performance through analysis of existing problems and
development of future plans. Consulting may involve the identification and crossfertilization of best practices, analytical techniques, change management and
coaching skills, technology implementations, strategy development, or operational
improvement. A consultant is usually an expert or an experienced professional in a
specific field and has a wide knowledge of the subject matter.
Examples:
1. Tata Consultancy Services (TCS)
Tata Consultancy Services (TCS) is a software and services provider in India. It is
part of the Tata Group, which oversees operations for over 100 companies in seven
business sectors: communications and information technology, engineering,
materials, services, energy, consumer products and chemicals.
2. Bain & Company
Bain & Company is one of the world's leading management consulting firms with its
offices in Mumbai, Delhi, and Bangalore in India. It works with top executives to help
them make better decisions and deliver the sustainable success they desire. They
are passionate about achieving better results for our clientsresults that go beyond
financial and are uniquely tailored, pragmatic, holistic, and enduring.
3. Crimson Consultancy Services
Crimson Consultancy helps you grow and expand your business with/in India. If you
wish to establish an office in India, hire people in India, want an appointment with a
company/authority, want a research report on India or any other service related to
India, Crimson will be a one-stop-shop solution for all your "India needs".
Financial Services
Financial services are the economic services provided by the finance industry, which
encompasses a broad range of businesses that manage money, including credit
unions,banks, credit-card companies, insurance companies, accountancy companies
, consumer-finance companies, stock
brokerages, investment
funds and
some government-sponsored enterprises.
Examples:
1. Foreign exchange services

Foreign exchange services are provided by many banks and

specialist foreign exchange brokers around the world. Foreign
exchange services include:
Currency exchange - where clients can purchase and sell foreign
currency banknotes.
Wire transfer - where clients can send funds to international banks
abroad.
Remittance - where clients that are migrant workers send money back
to their home country.

2. Investment services

Investment management - the term usually given to describe

companies which run collective investment funds. Also refers to
services provided by others, generally registered with the Securities
and Exchange Commission as Registered Investment Advisors.
Investment banking financial services focus on creating capital through
client investments.
Hedge fund management - Hedge funds often employ the services of
"prime brokerage" divisions at major investment banks to execute their
trades.
Custody services - the safe-keeping and processing of the world's
securities trades and servicing the associated portfolios. Assets under
custody in the world are approximately US$100 trillion.

Q.2. Give two examples of Open Ended and Close Ended Mutual Funds with
their concept in
two lines.
Open-End Funds
There are two types of these products on the market. Open-end funds are what you
know as a mutual fund. They don't have a limit as to how many shares they can
issue. When an investor purchases shares in a mutual fund, more shares are
created, and when somebody sells his or her shares the shares are taken out of
circulation. If a large amount of shares are sold (called a redemption), the fund may
have to sell some of its investments in order to pay the investor.
Unlike Stocks, an open-end fund are not traded on the open market. At the end of
each trading day, the funds reprice based on the amount of shares bought and sold.
Their price is based on the total value of the fund or the net asset value (NAV).
Example:

Sundaram Microcap Fund Series

WorldCommodity Fund

Closed-End
Funds
Closed-end funds look similar but they're very different. A closed-end fund functions
much more like an exchange traded fund than a mutual fund. They are launched
through an IPO in order to raise money and then trade in the open market just like a
stock or an ETF. They only issue a set amount of shares and, although their value is
also based on the NAV, the actual price of the fund is affected by supply and
demand, allowing it to trade at prices above or below its real value.
There are currently about 650 closed-end funds trading on the market, yet they are
not well known by retail investors. Some funds, like BlackRock Corporate High
Yield Fund VI (HYT), pay a dividend of more than 8%, making these funds an
attractive choice for income investors.
But investors have to know one key fact about closed-end funds. Nearly 70% of all
of these products use leverage as a way to produce more gains. Using borrowed
money to invest may produce big returns, but it could also put the fund under
intense pressure. Recently, Moody's downgraded the rating of many of the largest
banks that included debt securities issued by 38 closed-end funds.
These downgrades will likely make it more expensive for these and other closed-end
funds to borrow money in order to invest. Higher borrowing costs impact the return
investors receive from these funds, making them potentially less attractive in the
future.
Example:

Reliance Equity Fund closed-ended scheme

Birla Sun Life Focused Equity Fund-Series
ICICI Prudential Growth Fund -Series 5
Reliance Capital Builder Fund

Conclusion
Open-end products may represent a safer choice than closed-end funds, but the
closed-end products might produce a better return, combining both dividend
payments and capital appreciation. Of course, investors should always compare
individual products within an asset class; some open-end funds may be more risky
than some closed-end funds.
Q.3. Write 5 examples of Commercial Banks with their headquarters
and date of establishment.

Name of Commercial

Date of Establishment

Headquarters

Bank
1. Allahabad

Founded by a Group of

Bank

Europeans on 24th April

2. Bank

of

1865
Founded in the year 1908

Baroda
3. Bank

of

Founded

on

16th

Allahabad

Baroda
Pune

Maharashtra
4. Bank of India

September 1935
Founded
in
September

Mumbai

5. Canara Bank

1906
Founded on 1st July 1906

Bangalore

Q.4. Prepare a list of 10 NBFC working in India along with the type of
NBFC in which they belong.

NBFC Working in India

SHRIRAM CITY UNION FINANCE

Type of NBFC
Asset Finance Companies

LIMITED
United Overseas Finance Ltd
SHRIRAM TRANSPORT FINANCE COMPANY

Asset Finance Companies

Asset Finance Companies

LIMITED

ADITYA BIRLA FINANCIAL SERVICES

Core Investment Companies

LIMITED
L&T INFRASTRUCTURE

Core Investment Companies

DEVELOPMENT PROJECTS LIMITED

RELIGARE ENTERPRISES LIMITED
RELIGARE ENTERPRISES LIMITED
Janalakshmi Financial Services Limited
UJJIVAN FINANCIAL SERVICES PRIVATE

Core Investment Companies

Core Investment Companies
Micro Finance Institutions
Micro Finance Institutions

LIMITED
BANDHAN FINANCIAL SERVICES PRIVATE

Micro Finance Institutions

LIMITED

Q.5. Prepare a chart to show various types of Lease companies with 2

examples each.
Virtually, all financial lease agreements fall into one of four types of lease financing.

These are depicted in the following figure:

1) Finance Lease: Under finance lease all risks and rewards of ownership of asset
are transferred to lessee. The ownership or title may or may not be transferred. A
finance lease is somewhat like a hire purchase agreement. Under finance lease the
lessee after paying agreed number of installments, is entitled to exercise an option
to become the owner of asset.
Example:
Suppose the AB company takes a new automobile on lease for three year. Also
assume that at the end of three years the AB company will be called to take the
ownership of vehicle at no extra cost. Here not only the vehicle is taken on lease but
also the AB company is using the lease agreement as a means of financing the
automobile. This type is called capital lease or finance lease.
(2) Operating Lease: According to International Accounting Standard (IAS-17) the
operating lease is one which is not a finance lease. Under operating lease, the
lessor gives the right to lessee to use the asset or property for a specified period of
time, but risks and rewards of ownership are retained by the lesser.
Example:
Let up suppose that MY enterprises owns a complete 6th floor in Eden Tower, a multi
story building. Further assume that MY enterprises gives some rooms of this floor on
lease to XY corporation.
Now if the value of this building increase due to good business activity then the
lessor i.e., MY enterprises can take the benefit of this increase by either selling out
the rooms or by increasing the rental amount. On the other hand if the building
decreases in value than also the MY enterprises will be the sufferer of loss. This type
of leasing is called operating lease.
Besides these two main types, some other types of leasing are explained below:
(3) Sale and Lease Back: Under sale and lease back agreement, an asset is first
sold to the financial institution. The sale is made at the genuine market value. After
that the asset is taken back on a lease. This type of leasing is advantageous for

those companies which do not want to show high debt balances in their financial
statement.
(4) Leveraged Lease: This type of leasing involves three parties including a
lender, a lessor and a lessee. The lender and lessor join hands to accumulate funds
to buy the asset. The asset purchased is then given on the lease to lessee. The
lessee makes periodic payments to the lessor who in turn makes payment to the
lender.

Q.6. Differentiate between Leasing and Hire purchase on the basis of

evaluation.

BASIS

FOR

HIRE PURCHASING

LEASING

The deal in which one party can

Leasing

use the asset of the other party

where one party buys the

for the payment of equal monthly

asset and allows the other

installments is known as Hire

party to use it by paying

Purchasing.

consideration over a specified

COMPARISON
Meaning

is

an

agreement

period is known as Leasing.

Governing

Accounting

No Specific Accounting Standard

AS- 19

Down Payment

Required

Not Required

Installments

Principal plus interest

Cost of using the asset

Asset type

Car, trucks, lorries etc.

Land and Building, Property.

Ownership

Ownership

Standard

of

the

asset

is

transferred to the hire purchaser

on the payment of the last

Transfer

of

ownership

depends on the type of lease.

installment.
Repairs & Maintenance

Responsibility of hire purchaser.

Depends upon the type of

lease

Consideration

Initial payment plus installment.

Lease Rentals

Duration

Short Term

Comparatively Long term

Evaluation

The method of accounting used

There are two ways of leasing

by the parties is as under:

the asset, which are as under:

In the books of hire vendor:

o

Lease:

Interest Suspense

The

Method

covers only a small

Sales Method

part of the useful life

In the books of hire purchaser:

o

Operating

of

lease

the

which

asset

is

Interest Suspense

Operating Lease. In

Method

this kind of lease,

Cash Price Method

there is no transfer
of risk and rewards.

Finance Lease: A
lease

agreement

to

finance the use of

asset

for

the

maximum part of its

economic
known

life

as

is

Finance

Lease. All the risk

and rewards
incidental

to

the

ownership
transferred
lessee

is
to

with

the
the

transfer of the asset.