KOREA UNIVERSITY College of Business Administration BUSS207 Financial Management Fall, 2022 Instructor Office Phone E-mail Joonghyuk Kim LP516 02-3290-2607 j-kim@korea.ac.kr Class Time and Location: Mondays and Wednesdays 2:00 PM to 3:15 PM at LG-POSCO 432. Course Website: Course Blackboard (https://kulms.korea.ac.kr) Office Hours: Mondays and Wednesdays 3:30 PM to 4:30 PM (tentative) or by appointment I will make any announcement on the course website and/or by emails. Please visit the course website as often as possible. It is your responsibility to update the information provided to you via e-mail or course website. Course Objective The basic goals of this course are to familiarize the students with the tools and techniques used in financial management. While the focus of the course is on the corporation and its financial decision-making, many basic concepts and tools in Finance are introduced. These basic concepts and tools are useful in many areas of business or personal life. They include the notion of present value, securities valuation, risk analysis, and other financial analysis techniques. The techniques are in turn used to evaluate and make the decisions regarding the firm’s investments (capital budgeting) and the cost of capital. Prerequisites This course presumes some background on your part in the areas of accounting, statistics and basic knowledge of Excel. From your Accountancy class(es), you should be familiar with the structure of basic financial statements and the meaning of the items listed in these statements. All students should be familiar with Excel at a certain level. You may need to use Excel to complete some portions of your assignments. The functions you need for those questions will be explained and demonstrated during classes. Only English will be used in the classroom. Required Materials 1. Fundamentals of Corporate Finance, by Ross, Westerfield, and Jordon 2. Lecture notes (available from the course website) You are expected to finish all assigned readings before each class. I strongly recommend you to read a Korean financial newspaper and one of the followings: the Wall Street Journal, Business Week, Economist, Forbes, Financial Times, or Fortune to follow up on the current developments in financial market. 1 Grading Policy Your grade will be determined by your performance in the following areas according to the following weighting Midterm Final exam 4 Group Assignments Contribution to the final grade 35 % (TBA) 45 % (TBA) 20 % (TBA) Group Assignments You will have four assignments. Each assignment will be graded, and the grade will be a partial determinant of your course grade. No assignments will be accepted after the due dates. All assignments should be typed, and handwritten assignments are not acceptable. These assignments will give you practice with the types of calculations and concepts that are important to a proper understanding of the material of the course. If you prefer to work with one or more other students in completing these assignments, you may do so. Groups are limited to a maximum of 3 (tentative) students. However, once you form a group, you will have to keep the same group members throughout the semester. If you work in a group, the group will turn in one solution to each assignment and everyone in the group will receive the same score on the assignment. If more than one group works together and turns in, substantially, the same work, this violates the rules of the course and the rules on academic integrity, and penalties will be assessed. By the due date and time, you are required to upload a soft copy of your answers to each assignment to the course blackboard site (Assignments and Tests section). A hard copy of your answers will also be collected at the beginning of the class on due dates. Exams You will have two in-class exams, a midterm and a final. Both exams MUST be taken and both exams will be offline in-class. There will be NO MAKE-UP EXAM. The questions on the exams will parallel the questions and problems that are assigned with each class and those on the assignments in terms of the concepts and the computation skill required. Working problems and polishing your understanding of concepts with the practice questions will greatly enhance your understanding of the material and your performance on exams. All exams are closed book exams. For all the exams, you are responsible for all materials covered in the class, assigned readings, and assignments. Final exam is NOT comprehensive. Attendance Policy Your attendance will be checked regularly, although your attendance does not have any weight to determine your final grade. You are required to attend at least 70% of the classes, otherwise, you will receive a fail grade (F). Group Management Each member of a group is responsible for efforts to motivate other group members to do their part. If any member of a group is shirking his or her duties and the problem cannot be solved within the group, please bring that to my 2 attention as early as possible. I will try to work with the group to solve the problem. In the event that problems persist and a group member (or members) is uncooperative or unduly difficult, the group may divorce that member, provided that the problem was brought to my attention early enough and that real efforts were made to solve the problem. This will cause the divorced group member to receive a zero on all group assignments. Copyright Related Issue Materials and lectures in this course are protected by Copyright Law. Materials are presented in an educational context for personal use and study and should not be shared, distributed, or sold in print - or digitally - outside the course without permission. Electronic video and/or audio recording is not permitted during class unless the student obtains permission from the instructor. If permission is granted, any distribution of the recording is prohibited. Anti-graft Law Related Do not ask the instructor to change the grade unless there is a flaw in grading. Improper solicitation and graft for any matters are strictly prohibited by Anti-graft Law. Course Schedule The following is the tentative course schedule, and subject to change. Weeks Week 1 Week 1-4 Week 5-6 Week 6-7 Week 7-8 Week 9-11 Week 12-14 Week 14-15 Week 16 Topic Course Overview Chapter 1: Introduction to Corporate Finance Chapter 4 and 5: Time Value of Money Assignment 1 Due Chapter 6: Interest Rates Chapter 6: Continued Chapter 11: Risk and Rates of Return Chapter 11: Risk and Rates of Return Chapter 6: Bonds and Their Valuation Assignment 2 Due Midterm Exam Chapter 6: Bonds and Their Valuation Chapter 7: Stocks and Their Valuation Chapter 12: Cost of Capital Assignment 3 Due Chapter 8, 9: The Basics of Capital Budgeting Cash Flow Estimation and Risk Analysis Assignment 4 Due Final Exam 3