COURSE OUTLINE
Code:
Title:
Prerequis
ites
Course
Lecturers
Aims:
1
Course Value:
MN334 1B
Strategic Management Accounting and
Finance
Status:
MN104 and MN204
Recommended:
Availability:
Core
Autumn/
Spring
None
Dr Evangelos Giouvris (Autumn) and Dr Bill Ryan (Spring)
To develop a critical understanding of accounting and financial links to
strategy especially the enabling characteristics of and limitations of
accounting and finance in strategic decision- making.
This course will provide an overview of corporate finance in both a domestic and
an international setting. We will examine the relative benefits of debt and equity
financing as well as the dividend decision and identify the main trends in
mergers and acquisition activity. We will look carefully at the workings of
international capital markets emphasising the pricing of bonds and equities.
This course will provide students with a critical understanding and
background to issues that help shape strategic business decision-making. We
would also expect students to be aware that Management Accounting,
Finance and Business Strategy operate within a industry and institutional
context. The course will explore the current business context within which
management accounting operates and the factors that can promote or frustrate
strategic outcomes.
Learning
Outcomes:
Assessment:
By the end of the autumn term the student should be able to:
Apply the main principles of financial theory to commercial problems.
Understand the notion and relationship between risk and return.
Understand the valuation of equities, bonds and options and the relative merits
of different approaches.
Discuss the relevance of information efficiency.
Evaluate the consequences of a proposed takeover or merger.
Analyse the current state of financial markets.
30% of the total marks available for the course will be for two in-course
assessments -one in each term. The first term assignment (deadline:26
November 2009) will be discussed thoroughly during the first lectures and the
second assignment will be discussed at the first lecture in term 2. You are
required to hand in TWO copies and we strongly urge you to keep a copy for
yourself. The remaining 70% of the mark will come from the results of a 3hour examination at the end of the course. The examination tests your ability
to answer computational questions and demonstrate your ability to analyse
results by applying techniques covered on the course. It also allows you to
demonstrate your ability to explain and critically evaluate the techniques and
demonstrate your wider reading in the general subject area.
Teaching
&
Learning
Methods
Key
Bibliography
There will normally be a one-hour lecture plus a one-hour workshop each
week. Lectures start in week 1 of autumn term. The workshops start the
following week (i.e. week 2 of autumn term). Attendance is compulsory!
Autumn term:
Main Textbook:
Brealey, Myers and Marcus (2007). Fundamentals of Corporate
Finance, Mc-Graw Hill, 5th Edition.
Supplementary:
Berk, J, DeMarzo, P & Harford. J (2009) Fundamentals of Corporate
Finance, Pearson International
Brealey and Myers (2005) Principles of corporate finance, McGraw-Hill, 8th
Edition.
Arnold, G, (2005) Corporate Financial Management, London, FT Publishing,
3rd Edition.
In-course
Feedback:
Contact
info.
Formal formative assessment will comprise an assignment in each term
(which requires students to have developed and to demonstrate some
independent research skills). Informal formative assessment will take
place in workshops when students discuss the work they have
undertaken to prepare for the workshop. The essay assignment will be
returned with a standard cover sheet that includes the lecturer’s
comments. Feedback on answers to workshop questions and readings
will be given in the seminars. Students are also welcome to discuss
course-related issues with the lecturer involved during weekly office
hours or by appointment.
Dr Evangelos Giouvris
Founder’s East 134
Tel. 01784 276115
Email: evangelos.giouvris@rhul.ac.uk
Date
Week 1
Lecture
Autumn Term
Readings
Chapters 1 and 2
Goals and governance of the firm.
Financial markets and institutions.
Week 2
Chapter 5
Time value of money
Week 3
Chapter 6
Valuation of bonds
Week 4
Chapter 7
Valuation of stocks
Week 5
Chapter 8
NPV and other investment criteria
Week 6
Week 7
Chapter 11
Intro to risk, return, opportunity cost
and portfolio diversification
Chapter 12
Risk, return and capital budgeting/
CAPM/ efficiency
Week 8
Chapter 23 +extra notes
Valuation of options I
Week 9
Chapter 24 + extra notes
Valuation of options II: Risk
management
Week 10
Chapter 21
M&A/ revision
Seminar questions/exercises will be given during the lecture