School Of Business Administration
Syllabus
Course Title
Course Number
Semester
Instructor
Office Phone
Email
Office
Office Hours
appointment.
Web Site
: Financial Policy and Planning
: iMBA-629
: Spring 2016
: Dr. D.K. Malhotra
: (215) 951-2813
: MalhotraD@philau.edu
: 104 Tuttleman
: 9:30 a.m. - 10:30 a.m. Monday and Wednesday or by
Credits
Course Type
: 3.0
: 3-0-3
: http://faculty.philau.edu/MalhotraD
Prerequisites: All students must have completed iMBF 505 or equivalents.
It is the students' responsibility to make certain that they have successfully completed
these courses. If at any time during the semester it is learned that a student has not
successfully completed these prerequisites, he/she will be dropped from the course
receiving, neither credit nor tuition refund.
Course Description:
This course focuses on the investment and financing decisions of the firms. Topics
include capital budgeting, cash management and cash flow analysis, capital
structure, dividends, and international operations. Financial policy making is
considered within the context of contemporary valuation and risk management
theories. Various financial planning models are analyzed in the course.
Course Objective:
The objective of this course is to further enhance the student’s ability to approach
and make financial decisions. This course is intended to be a blend of both the
theoretical and practical aspects of financial decision making.
Course Outcomes:
Upon course completion, students will be able to:
1. Demonstrate proficiency in analyzing financial statements to identify the
strengths and weaknesses of a firm
2. Develop the ability to analyze capital budgeting decisions of a firm using
traditional capital budgeting techniques of discounted cash flow analysis
3. Demonstrate the ability to estimate the cash flows from a project
4. Develop the ability to analyze the relationship between risk and return and
its impact on financial decision making
Overview of expectations for the course, including major assignments or
projects:
Assignments
Weight
Evaluates which Course
Outcomes?
HW assignments
20%
Outcomes 1, 2, 3, and 4
Midterm exam
30%
Outcomes 1, 2, 3, and 4
Final Exam
30%
Outcomes 1, 2, 3, and 4
Financial Analysis Project
10%
Outcomes 1, 2, 3, and 4
Class Participation
10%
Outcomes 1, 2, 3, and 4
Grade Distribution:
Letter Grade
A
AB+
B
BC+
C
CF
Grade
Points
4.00
3.67
3.33
3.00
2.67
2.33
2.00
1.67
0.00
Percent Allocated
93% or higher
90% to < 93%
87% to < 90%
83% to < 87%
80% to <83%
77% to <80%
73% to <77%
70% to <73%
<70%
Required Text(s) and/or Supplies:
Corporate Finance by Ross, Westerfield, and Jaffe, McGraw Hill/Irwin Publishing Co.,
tenth edition (ISBN: 0078034639), 2013 edition.
Additional Recommended Readings:
The Wall Street Journal; Barron’s Paper; Corporate Finance
Attendance:
Attendance is mandatory. You are responsible for what is covered in the class and
any absence on your part leaves you responsible for finding out what was presented
in class. You will benefit a lot from the course by doing problems and reviewing
concepts which are covered in the class. For every class that you miss without a
valid excuse, there will be a penalty of two points from your final grade.
Academic Integrity
Academic integrity is a policy about ethical behavior at Philadelphia University
regarding one’s intentions, decisions, and actions while conducting academic work.
It includes values such as avoidance of the following: cheating; plagiarism; copying;
the fabrication of information; and facilitating, or denying others access to
information. It expects honesty and rigor in research, course work, writing and
publishing. Academic Integrity is taken seriously in this course. Any student
violating the University’s academic integrity policy will be subject to appropriate
sanctions. The University’s complete academic integrity policy is available in the
Academic Catalog and University’s Student Handbook. Academic resources,
including information on citation and documentation for all written work, projects,
and presentations, are also available on the Learning and Advising Center’s website:
http://www.philau.edu/learning/writingguidelines.html.
Policy on Lateness, Absences, Makeup Work
In accordance with University policy, students are expected to attend class every
day with all relevant required course materials and work. If you are absent from
class, contact your faculty as soon as possible, preferably before the next class
meeting. Students remain responsible for any missed work, for work completed in
class and for work due and must arrange for that work to be delivered to the faculty
on time.
Serious illness, family emergencies, or other crises mean that students should
contact the Dean of Students Office as soon as possible (215-951-2740) and follow
up with a direct explanation to the faculty. Students are responsible for all work
related to this class; however, faculty may (but are not required to) make some
accommodation in terms of time of delivery and/or make-up exams for major tests.
Please consult with your faculty and your academic advisor to determine whether
you should withdraw from the course or request an incomplete grade in the case of
serious illness or crises.
Information regarding the Collection of Student Work for Assessment
Philadelphia University is committed to providing excellent and innovative
educational opportunities to its students. To help us maintain quality academic
offerings and to conform to professional accreditation requirements where relevant,
the University and its programs regularly examine the effectiveness of the curricula,
teaching, services, and programs the University provides. As Philadelphia University
sees appropriate, it may retain representative examples or copies of student work
from all courses. This might include papers, exams, creative works, or portfolios
developed and submitted in courses or to satisfy the requirements for degree
programs as well as surveys, focus group information, and reflective exercises.
Information on Digital Resources
This includes course system site, materials placed on electronic reserve, class email
distribution lists, and course-specific websites. If no digital course supplements are
being used, the syllabus should indicate as much. The use of Blackboard is
recommended (but not required) to provide effective communication and
supporting resources.
Academic Support Services: Gutman Library (www.philau.edu/library)
Gutman Library is a gateway to a variety of information resources. The homepage of
the library provides 24/7 access to online databases of articles, e-journal
collections, e-books, and specialized information to support your coursework. The
library building is wireless, has 80 available workstations (PCs and Macs), printers,
scanners, and copiers; as well as individual and group study spaces.
Business related databases, which might be helpful include ABI/Inform and
Business Source Premier. Business newspapers that are available include: Wall
Street Journal, Wall Street Journal – Asia, Financial Times, New York Times and
Philadelphia Business Journal. Links to the online versions of these newspapers are
found through the “Journals by Title” link on the library’s homepage. Refer to the
Research Guides http://libguides.philaU.edu/start for more information, and see
especially specific guides for Business, Entrepreneurship, Marketing, Management,
Company Information, and Industry Information. Contact the Reference Desk
directly Reference@philau.edu for more specialized help in identifying sources, or
stop by the Reference Desk when the library is open.
The Learning and Advising Center (www.philau.edu/learning)
The Learning and Advising Center provides one-on-one tutoring assistance for
writing, study strategies, test taking, and specific Philadelphia University courses*.
To make a tutoring appointment, students should stop by the Learning and Advising
Center in Haggar Hall or call (215) 951-2799. Academic resources, including
information on citation and documentation, note taking, and study strategies are
available on the Center’s website.
Technology Resources (http://www.philau.edu/OIT/)
The campus is wireless. If you need a computer, Gutman Library and Search Hall
have open access computers. For assistance with technology issues, students should
contact the Technology Help Desk at (215) 951-4648 or send an email to
helpdesk@philau.edu.
5. and case writings.
Case Reports: The cases should be presented in a manner acceptable in a large
corporation. The decision as well as the qualitative and quantitative reasons for the
decision should be communicated in a typed memo. The relevant information
should follow the memo in table form with supporting notes showing calculations.
Cases will be evaluated according to content, analysis, presentations, and continuity.
If any two cases are identical, plagiarism will be assumed and no credit will be given to
either case.
CASE ASSIGNMENT REQUIREMENT:
Case reports must be submitted as per the following format:
1. Title Page:
Name of the Case
Prepared by
Course Number
Date
2. Executive Summary
One half to one page summary of the issues involved and the strategy and
recommendations must be included.
3. An analysis of the case on the basis of the questions given at the end of the case.
Your analysis of each question must include the following:
4.
Issues Involved
Strategies to deal with those issues
Recommendations with rationale
Length of Case Preparation: 4-5 pages
6. Papers are to be word-processed with correct grammar and punctuation.
Information in the papers must be properly documented.
Guideline: Consult other business communication books on business reports
Tentative Course Outline:
01/14
Introduction to Corporate Finance
 Introduction to the Course
 Meaning of Corporate Finance
 Significance of Corporate Finance
01/19
Introduction to Corporate Finance
 The Corporate Firm
 Goals of the Corporate Firm
 Agency Relationship between Shareholders and
Management
 Ethics and Shareholder Wealth Maximization
01/21
How to motivate management?
01/26
Accounting Statements and Cash Flows
 Meaning of Financial Statements
 Significance of Financial Statement Analysis
 Types of Financial Statements
o The Balance Sheet
o The Income Statement
o The Working Capital
o Common size financial statements
 Financial Statement Analysis
01/28
Accounting Statements and Cash Flows
 Financial Statement Analysis
02/02
Accounting Statements and Cash Flows
 The Ratio Analysis
 Du Pont Analysis
 Limitations of Financial Analysis
02/04
Financial Statement Analysis
02/09
Financial Statement Analysis
02/11
Capital Budgeting and Techniques
 Meaning of Capital Budgeting
 Types of Capital Budgeting Techniques
 Payback Period Approach and Discounted Period
Approach
02/16
Capital Budgeting Techniques
 Net Present Value Approach
 Internal Rate of Return
02/18
Capital Budgeting Techniques
 Profitability Index;
 Modified Internal Rate of Return
 Capital Rationing
02/23
Capital Budgeting Techniques
 NPV versus IRR
 NPV versus PI
 Evaluating Projects with unequal lives
02/25
Capital Budgeting Techniques
 Evaluating Projects with unequal lives
03/01
Project Cash Flow Analysis
 Incremental Cash Flows
 Inflation and Capital Budgeting
03/03
Project Cash Flow Analysis
 Estimating Project Operating Cash Flows
 Estimating Project Total Cash Flows
03/08
Project Cash Flow Analysis
03/10
Project Cash Flow Analysis
03/15-03/17 Spring Break
03/22
Strategy and Analysis in Using Net Present Value
 Corporate Strategy and Positive NPV
 Sensitivity Analysis
03/24
Strategy and Analysis in Using Net Present Value
 Scenario Analysis, and
03/29
Strategy and Analysis in Using Net Present Value
 Break-Even Analysis
03/31
Strategy and Analysis in Using Net Present Value
 Decision Trees and Real Options to Analyze Capital Projects
04/05
Risk and Rates of Return




Meaning of Risk
Meaning of Return
Measurement of Return
Measurement of Risk
04/07
Risk and Rates of Return
 Concept of Systematic and Unsystematic Risk
 Concept of Beta and Systematic Risk
 CAPM
 Returns; Holding Period Returns; Risk; Discount
 Rate for Risky Projects; Risk and Beta
 Capital Asset Pricing Model (CAPM)
04/12
Risk and Capital Budgeting
 Risk, Return, and Capital Budgeting
 The Cost of Equity Capital; Determinants of Beta
04/14
Determining the Cost of Capital for a Project
04/19
Corporate Financing Decisions
 Common Stock
 Corporate Long-Term Debt
 Patterns of Financing
04/21
Capital Structure Decisions
 The Choice between Debt and Equity
04/26
Student Presentation of Company Analysis
04/28
Student Presentation of Company Analysis
FINANCIAL ANALYSIS ASSIGNMENT
iMBA 629
Financial Policy and Planning
Spring 2016
Due Date: April 21, 2016
You work as a junior analyst in the chief financial officer’s office. Your boss has
asked you to conduct a detailed analysis of a company and prepare a detailed report
by identifying the strengths and weaknesses of the firm. You should provide a
recommendation that “YOU” think is correct and not what other “experts” think is
correct.


You must submit the project by the due date. If you do not submit the report by
the due date, you will lose three points from the score for your project.
If you choose not to do the project, you will receive an “F” in this course.
You report should be organized along the following lines:
FORMAT:
Interpret the financial information given in the financial statements along the
following lines:
a. Prepare an executive summary of your findings.
b. Assess the firm's
o Liquidity position.
o asset management ratios
o debt management ratios
o profitability ratios
o total cash flow of the firm
o operating cash flow
o sustainable growth rate for the firm
c. Apply the Du Pont analysis to the latest year to obtain a general overview of the
firm's financial condition.
Your report should not exceed ten pages (excluding supporting documents).
Initial Proposal Due
Final Report Due
: February 5, 2016 (5%)
: April 21, 2016 (85%)