FIN 201: Introduction to Business Finance
School of Business Studies, IBA Karachi
Program:
Department Offering:
Class ERP Number:
Faculty:
BBA/BSAF
Finance
Dr. Noureen Ayaz
Class details
Class Timing and
Room
Monday / Wednesday 10:00 am, 11:30 am, 1:00pm
Session Days
Tuesday/Thursday
Credit Hours:
3 Credit Hours
Email
nayaz@iba.edu.pk
Contact #
021 38104701 Extension: 3022
Course Description
The course is designed for the undergraduate business students who have not yet been exposed
to the basic concepts of finance. This first course aims to introduce the students to the
important, interesting and challenging field of Finance.
The course focuses on the fundamental principles of finance and familiarizes the students with
the various concepts of finance, along with its importance and use in our financial decisions.
The course is structured in a manner that it starts from the very basics and then leaves the
students at a level where they will be able to pursue more advanced finance courses. Moreover,
as a consequence of this course, students’ confidence to work with financial information will
improve considerably.
BBA/BSAF Program Learning Competencies (PLCs)
1. Knowledge of Business & Management (BBA)
Students will be able to demonstrate a foundational understanding of core business functions.
1. 1.Knowledge of Accounting & Finance (BSAF)
Students will be able to prepare and analyze financial statements and build financial models.
2. Critical Thinking
Students will be able to critically analyze and evaluate information in business context.
3. Communication and Teamwork
Students will be able to communicate effectively and collaborate within teams to achieve desired objective.
4. Ethical Reasoning and Social Responsibility
Students will be able to analyze ethical dilemmas and understand legal and regulatory frameworks in business.
Program Learning Objectives (PLOs) Embedded in this course
BBA
BSAF
PLO 102 – Demonstrate an understanding of
fundamental financial concepts. (Introduce)
PLO 102 – Analyze financial data to assess a
company's financial performance. (Introduce)
PLO 401 – Analyze business decisions from an
ethical perspective, considering the impact on
stakeholders and the environment. (Enhance)
PLO 501 – Utilize appropriate tools for
analyzing business problems. (Enhance)
PLO 103 – Build financial models to make
informed decisions. (Introduce)
PLO 401 –Analyze business decisions from an
ethical perspective, considering the impact on
stakeholders and the environment. (Enhance)
PLO 501 – Utilize appropriate tools for
analyzing business problems. (Enhance)
IBF Course Learning Outcomes (CLOs)
1.
2.
3.
4.
5.
6.
Students will understand the terminology and basic concepts underlying business finance
and the local and global financial environment in which business decisions are made.
Be able to understand financial statements, work with data available and evaluate
through ratios the financial position and performance of the company.
Students should be able to understand basic financial principles
(TVM, BOND VALUATION, Financial performance valuation, stock valuation etc.)
Students will be able to understand the conceptual relationship between the expected
return and the relevant risk of individual assets and portfolios of assets.
Students will be able to estimate the effect of growth on the need for external financing.
Students will be able to understand the factors determining interest rates and the theories
explaining the yield curve.
Skills/Abilities
The course will inculcate skills on team working, reading through financial statements, doing
analysis based on ratios.
Teaching and Learning Methodology
1. Students are required to read the topic prior to the lecture. During lecture, we will
discuss the topic and solve selected examples or questions.
2. Market data and information will be gathered regularly in order to add richness to the
course.
3. Short in-class activities and exercises will be done in order to reinforce the concepts
learned.
Course Learning Outcomes mapped to Program Learning Competencies
Knowledge of Business
& Management
Knowledge of
Accounting &
Finance
BBA
BSAF
1
PLO 102
PLO 102
PLO 103
2
PLO 102
PLO 102
PLO 103
3
PLO 102
PLO 102
PLO 103
4
PLO 102
PLO 102
PLO 103
5
PLO 102
PLO 102
PLO 103
6
PLO 102
PLO 102
PLO 103
Program Learning
Competencies
Critical
Thinking
Communication
and Teamwork
Ethical
Reasoning
and Social
Responsibilit
y
Technology
and
Information
Literacy
Course Learning
Outcomes
PLO 401
PLO 501
Course Learning Outcomes mapped to Program Learning Competencies
Knowledge of Business
& Management
Knowledge of
Accounting & Finance
BBA
BSAF
1
PLO 102
PLO 102
PLO 103
2
PLO 102
PLO 102
PLO 103
3
PLO 102
PLO 102
PLO 103
4
PLO 102
PLO 102
PLO 103
5
PLO 102
PLO 102
Program Learning Goals
Critical Thinking
Communication
and Teamwork
Ethical Reasoning
and Social
Responsibility
Course
Learning
Outcomes
PLO 401
PLO 103
6
Reading
Chapter 1: An
Overview of
Financial
Management
PLO 102
Mapping to Course
Learning Outcomes
CLO 1
Handout: Ethics
Chapter 2:
Financial
Markets and
Institutions
Chapter 4:
Analysis of
Financial
Statements
CLO1
Chapter 17:
Financial
Leverage and
Breakeven
Analysis
Chapter 5: Time
Value of Money
Chapter 6:
Interest rates
Session Topic








Introduction and discussion of the course outline





Capital allocation process
Financial Markets
Financial Institutions
(Banking and Nonbanking Financial Institutions)
SRI (Socially responsible Investments)


Review of financial statements
Liquidity, Solvency, Asset Management,
Profitability and Market Value Ratios
Du Pont Analysis
Benchmarking: time trend and peer group
analysis – Project based
CLO2


Chapter 3-m
section 3-9B
Chapter 17:
Financial
Planning and
Forecasting
PLO 102
PLO 103
CLO5
CLO2
CLO3
CLO6
Discussion of basic concepts of finance, terminologies
What is business finance?
Importance of financial decisions
Alternate forms of business organization
Goals of financial management
Agency Problem
Ethics

Corporate Taxes



Sales forecast Method
AFN Equation
Forecasted Financial Statements


Breakeven Analysis.
Operating and Financial Leverage Analysis,
measures and significance






Timelines
Future Value
Present Value
Discounted cash Flows
Annuities
Amortization Tables



The cost of money (interest rates)
Determinants of market interest rates
Term structure of interest rates (yield curve)
Chapter 7: Bonds
and their
Valuation
CLO3
Chapter 8: Risk
and Rates of
Return
CLO4





Types and features of debt
Valuation of bonds
Bond Pricing
Yield calculation
Yield to Call

Calculating historical and expected return and
risk
Risk Diversification for Portfolios
Relationship between risk and return: CAPM


Spreadsheet Exercise: Beta Calculation


Chapter 9: Stocks
and their
Valuation
constant and non-constant growth Stocks;
Dividend and Capital Gains Yields
CLO3
Chapter 16:
Working Capital
Management
Types and features of stocks
Overview of stock valuation models,; No growth,

Dividend discount model



Overview of Working Capital Management
Cash Budget
Receivables Management – Evaluating Credit
Policy Change
Text Book and Pre-Course Reading Material, Important Dates.
Recommended Text :
Fundamentals of Financial Management. Eugene F. Brigham & Joel H. Houston. 16th
Edition.(2022)
Secondary Texts :
Fundamentals of Corporate Finance. Stephen A. Ross, Randolph W. Westerfield & Bradford D.
Jordan, latest edition.
Fundamentals of Financial Management. Eugene F. Brigham & Joel H. Houston. 15th
Edition.(2019)
Prerequisite Skills and Knowledge to take this Course
Since IBF is an introductory finance course, there is no pre-requisite for the course. Students
needing help can come for counseling on Monday (02:15 pm – 03:15pm.)/ Wednesday (02:15 pm
– 03:15pm.)
AOL Assessment
There is no AOL assessment for this course
Assessments and Grading Scheme
Assessment
Home Assignments
Class Assignments
Due Date
Remarks
Ongoing (end of a
topic/as announced in
class)
As announced in class
Would consist of end of chapter questions/
any other topic deemed fit by the instructor
Ongoing
The quizzes may be in advance or from the
previous topic. There will be a perfect zero
if you miss the quiz.
Quizzes
Mid Term Exams
Practice Questions/any topic deemed fit by
instructor
Exam Weeks
This course follows absolute grading.
Marks Distribution
Total Frequency
Total Exempted
Marks
/Frequency
Total Marks
/Head
Home Assignments
X
0
10/x
10
Quizzes
Y
2
10/y
10
Project
1
0
20
20
Mid-term
1
0
25
25
Final Examination
1
0
35
35
Marks Head
Total Marks
100
Comments and/or Suggestions
•
•
•
•
Active class participation will be rewarded by adjusting the grade upwards when it is on the
margin.
Since subsequent topics build on previously learned material, it is imperative that students
keep up with the material. In addition, you should ensure that lectures are understood
properly.
A student who misses a class is responsible for obtaining any handouts and information on
course content, assignments, due dates, test dates, etc.
Unethical behavior (cheating, plagiarism, proxy attendance) will be strictly penalized.
Technology & Innovation
•
•
All course materials will be posted on LMS and grades will be posted on ERP. Students are
responsible to stay updated on these platforms. For discussions and course related queries,
please join the class whatsapp group.
Excel shall be used extensively in the term project.
Experiential Learning Exposure(s)
Students will do one group project as part of the course. The projects would involve calculating ratios and
doing a financial analysis for firms listed on Pakistan Stock Exchange. Guest speakers sessions related to
Pakistani capital markets will be arranged. Moreover, a visit to PSX shall also be arranged.
Social Contribution / Impact
Environmental, Social and Governance (ESG) factors will be introduced, and their implication will
discussed where applicable throughout the course.
Academic Conduct
IBA policy
Attendance Policy
IBA policy
Plagiarism Policy
IBA policy
Withdrawal Policy
IBA policy