Financial
Management
FIN 2500
• Bachelor of Commerce
• Degree Program
• Professor M. Racanelli, MBA, FSCI
• Fall 2025
Companies discussed are for concept application only.
1
NOT YOUR FINANCIAL ADVISOR
FIN 2500 AGENDA
• Welcome &
Introductions
• Expectations
• In the News
• Weekly Reflections
• Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR
2
Land Acknowledgment: Honouring the Land
Humber College is located within the traditional and treaty lands of
the Mississaugas of the Credit. Known as Adoobiigok [A-doe-beegoke], the “Place of the Alders” in Michi Saagiig [Mi-Chee Saw-Geeg]
language, the region is uniquely situated along Humber River
Watershed, which historically provided an integral connection for
Anishinaabe [Ah-nish-nah-bay], Haudenosaunee [Hoeden-noshownee], and Wendat [Wine-Dot] peoples between the Ontario
Lakeshore and the Lake Simcoe/Georgian Bay regions. Now home to
people of numerous nations, Adoobiigok continues to provide a vital
source of interconnection for all.
For more information, visit the Indigenous Education and Engagement Centre (LRC2137) North Campus, (WEL301) Lakeshore Campus or https://humber.ca/indigenous
Expectations
Participation, Engagement and Critical and Civil Discourse
✓
Communication
✓
Engagement
✓
Preparedness; including: Weekly In the NEWS item and
presentation(s)
✓
Attendance and Punctuality
✓
What to Bring- including positive and mindful attitude (Eg
✓
formula sheet, working laptop, calculator, textbook)
✓
Group Work- Weekly Presentations- NO READING
✓
Classroom Etiquette: Modeling Professional Behaviour
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR
Name/Background/Degree program eg
Finance, HC, etc.
Introduction • What is your Purpose?
and 5 Qs
• What are your skills?
• How are you spending your time?
• Describe your listening & Questioning
Skills?
Companies discussed are for
concept application only. NOT
YOUR FINANCIAL ADVISOR
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR
5
In The News:
Weekly Discussion
Companies discussed are
for concept application
only.
NOT YOUR FINANCIAL
ADVISOR
Recommended Sources: BloombergNews,
https://www.bnnbloomberg.ca/markets/
National Post, Globe and Mail, WSJ,
Google Finance, Bloomberg Businessweek
6
https://libguides.humber.ca/library-spotlight/posts/Read-newspapers-online-throughPressReader
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR
7
Course Learning Outcomes
• Review accounting data and prepare key financial statements using publicly
available information.
• Calculate key accounting and financial ratios to gauge the financial performance
• Explain the method of forecasting the financial statements in response to a
change in sales of a business organization.
• Prepare Pro Forma financial statements using percentage of sales method.
• Evaluate the different types of leverage, in the context of the opportunities and
limitations of leverage.
• Identify various sources of short-term financing/discuss the risks associated with
the short-term financing.
• Conduct cost-benefit analysis for current asset management.
• Apply time value of money concepts to calculate rates of returns for stocks and
bonds and analyze the impact on financial management decisions.
• Communicate financial decisions concisely and effectively in oral, written, digital
and visual forms, appropriate to decision makers.
• Define the goals and functions of financial management and the role of financial
markets in today's business environment.
8
Critical Path SUBJECT TO CHANGE
Fin 2500 Tuesday CRN 3689 RM L005
Course outline https://humber.ca/cossid/outlines/full_view/2224/2025
Note: course schedule may change as resources/circumstances require
TEXT BOOK: Foundations of Financial Management (BLOCK, HIRT, DANIELSON, SHORT, MEEHAN) Thirteenth CANADIAN Edition -- MCGRAWHILL
Date
Sept 2 2025
Sept 9 2025
Sept 16 2025
Sept 23 2025
Sept 30 2025
Oct 7 2025
Oct 14 2025
Oct 21 2025
Oct 28 2025
Nov 4 2025
Nov 11 2025
Nov 18 2025
Nov 25 2025
Dec 2 2025
Dec 9 2025
Week
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Chapter Content
1
Goals and Functions of Financial Management
2
Review of Accounting
3 & 4 Financial Analysis Financial Forecasting
3 & 4 Financial Analysis Financial Forecasting
5
Operating and Financial Leverage - CASE STUDY DUE
6
Working Capital and the Financing Decision
Mid-term Examination (chapters 1,2, 3,4, 5, 6)
READING WEEK
7
Current Asset Management
8
Sources of Short-Term Financing
9
Time Value of Money: An Introduction
Presentations* Groups TBC
Presentations * Groups TBC
10
Valuation and Rates of Return
ALL Final Comprehensive Examination; All chapters
listed above
Evaluations: *Presentation: 15% Weeks: 11 (Groups 1- 4) & 12 (Groups 5-7) Groups
TBC; CASE Study +Excel andCompanies
In class
Assignments:
20; Mid Term: 30%; Final
discussed
are for concept
application
only. NOT YOUR FINANCIAL
9
Comprehensive Exam: 40% Total
100%
ADVISOR
FIN 2500 Course Content and Recommended Homework
Weekly Coverage Topic
Chapter
Discussion Questions
Problems
Goals and Functions of
Financial Management
Chapter 1
2, 4, 6, 8,10, 11, 12
4, 5
W2 Review of Accounting
Chapter 2
1, 3, 4, 5, 9
1,7,10, 12,15 25
Financial Analysis Financial
Forecasting
Chapters 3 & 4
CH 3 1, 2,4,7, 10
CH 4: 2,4,6
Ch 3: 1, 2,4,6,8,18, 32
Ch 4: 2, 19, 20, 28
Operating and Financial
Leverage
Chapter 5
2, 6 , 8, 10
2, 10, 12, 18, 19, 20
Working Capital and the
Financing
Chapter 6
3, 4, 6, 7, 11, 13
4, 6, 8
Current Asset Management
Chapter 7
1, 2, 3, 4
1, 6, 8, 9, 11, 14
Sources of Short-Term
Financing
Chapter 8
1, 4, 8, 10, 11, 12
1, 2, 11, 15, 24, 25, 36
Time Value of Money
Chapter 9
3, 4, 5, 6, 7, 8, 9
1,3, 4, 5, 6, 11, 14,16,
Evaluations and Rates of
Return
Chapter 10
1, 2, 3, 4, 5, 8, 11, 14, 1,2, 3, 4, 5, 6, 7, 8, 9, 10, 13,
15,discussed
16 are for concept
14,16, 18.19, 31a and b,32
Companies
application only. NOT YOUR FINANCIAL
ADVISOR
10
Group Company
1.
MDA Space (MDA)
1.
AMD (Advanced Micro Devices )
1.
BMO Bank of Montreal (BMO)
1.
Rogers (RCI)
1.
Celestica (CLS)
1.
BrookField Infrastructure. (BIP)
1.
MDA Space (MDA)
1.
AMD (Advanced Micro Devices )
1.
BMO Bank of Montreal (BMO)
1.
Rogers (RCI)
1.
Celestica (CLS)
1.
BrookField Infrastructure. (BIP)
1.
MDA Space (MDA)
1.
AMD (Advanced Micro Devices )
1.
BMO Bank of Montreal (BMO)
1.
Rogers (RCI)
1.
Celestica (CLS)
1.
BrookField Infrastructure. (BIP)
1.
MDA Space (MDA)
1.
AMD (Advanced Micro Devices )
1.
BMO Bank of Montreal (BMO)
1.
Rogers (RCI)
1.
Celestica (CLS)
1.
BrookField Infrastructure. (BIP)
1.
MDA Space (MDA)
1.
AMD (Advanced Micro Devices )
1.
BMO Bank of Montreal (BMO)
1.
Rogers (RCI)
1.
Celestica (CLS)
1.
BrookField Infrastructure. (BIP)
1.
MDA Space (MDA)
1.
AMD (Advanced Micro Devices )
1.
BMO Bank of Montreal (BMO)
1.
Rogers (RCI)
1.
Celestica (CLS)
1.
BrookField Infrastructure. (BIP)
1.
MDA Space (MDA)
1.
AMD (Advanced Micro Devices )
1.
BMO Bank of Montreal (BMO)
1.
Rogers (RCI)
1.
Celestica (CLS)
Student Name
DATE and Signature
Adesalu, Olubunmi C.
Almirol, Glenda L.
Bieniasz, Ella J.
Cheema, Sachdeep Singh S.
Coyne, Daniel
Dao, Nu Thuy Quynh
Deschenes, Aidan E.
Dhingra, Shourya
Dishita, Dishita
Flores Raquio, Brandon A.
Gill, Amrinderjit S.
Hirae, Thomas K.
Hook, Melissa S.
Jeyakumar, Kisanthy
Johnson, Lauren A.
Karisik, Nastassja
Kaur, Harnoor
Kaur, Samreen
Kenyon, Latoya
Kha, Bob
Khan, Mohammed Zain
Khan, Muhammad S.
Kumar, Vivek
Larter, Catherine
Le, Quynh Anh N.
Lin, Qianhao
Mbozi, Tariq
McPherson-Wilson, Malik
Miller, Peta-gaye O.
Mohammad, Abdullah
Ngo, Long T.
Nguyen, Duc T.
Patel, Lubna
Randhawa, Justin
Soukhoumalay, Thipthida
Sutlic, Ella
Tamhane, Saloni
Trefilin, Daniil
Truong, Thi Quynh Nhu
Companies
discussed are for concept
Tutiven, Ashley
A.
Zaoral, Katelyn
application only. NOT YOUR FINANCIAL
Companies discussed are
for concept application
only.
NOT YOUR FINANCIAL
ADVISOR
ADVISOR
11
The Goals and Activities of Financial Management
• The Field of Finance
• Evolution of Finance as a Discipline
• Goals of Financial Management
Chapter 1 • Functions of Financial Management
Outline • Forms of Organization
• The Role of the Financial Markets
• Summary and Conclusions
Companies discussed are for concept
application only. NOT YOUR FINANCIAL
ADVISOR
12
Learning Objectives
Illustrate
• Illustrate how finance builds on the
disciplines of accounting and
economics, with connections to other
disciplines. (LO1)
Identify
• Identify the analysis and decisionmaking nature of finance while
considering return and risk. (LO2)
Examine
• Examine the primary goal of finance
as the maximization of shareholder
wealth as measured by share price.
(LO3)
Debate
• Debate alternative goals of the firm
on the basis of social or
management interests. (LO4)
Identify
• Identify financial manager activities
connected to the efficient raising
and investing of funds, as well as
daily cash management. (LO5)
Outline
• Outline the role of financial markets
in allocating capital, determining
value, and establishing yields. (LO6)
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR
13
The Field of
Finance:
• Finance is about making decisions that
focus on creating value within the firm and
builds upon the disciplines of economics
and accounting.
▪ economics provides theories about
Creating Value economic system and decision making,
▪ accounting supplies financial data and data
analysis tools.
Companies discussed are for concept application only.
Companies discussed are for concept application
NOT YOUR FINANCIAL ADVISOR
only. NOT YOUR FINANCIAL ADVISOR
14
The Field of Finance: Risk-Return
Finance tries to help financial managers to answer (i.e.
make decisions about) the following questions made within
a risk-return framework:
Question
Decision
What long-term investments or projects
the firm should undertake?
capital budgeting
How the firm should pay for these assets?
By issuing equity or debt?
capital structure
© 2024 McGraw Hill
How much cash or inventory the firm
should carry?
15
working capital
management
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR15
Goals of Financial Management
The primary goal is
shareholder wealth
maximization as the
firm is owned by the
shareholders.
This goal should be measured in
terms of market share price,
which is a value that investors
collectively are prepared to pay.
The closest alternative – profit – fails to consider risk
and timing and more importantly, it is almost
impossible to accurately measure profit.
Companies discussed are for concept application only. NOT
YOUR FINANCIAL ADVISOR
16
Goals of Financial Management:
Agency Theory
The goal of maximizing shareholder wealth may conflict with interests of
management (their compensation) and social/ethical goals.
Agency theory is about the potential conflict between shareholders and
managers.
Tradeoffs exist among the agency costs of monitoring management actions,
allowing sufficient discretion for management and designing compensation
packages to motivate management.
Companies discussed are for concept application
only. NOT YOUR FINANCIAL ADVISOR
17
Goals of Financial Management:
Social Responsibility
• The goal of shareholder wealth maximization can be
consistent with a concern for social responsibility.
• Firms should take socially desirable actions that consider:
▪ pollution control
▪ fairness and honesty
▪ insider trading
▪ manipulation of financial results
Companies discussed are for concept
application only. NOT YOUR FINANCIAL
ADVISOR
18
Functions of Financial Management
The study of finance has a variety of functions
• Corporate finance
• Banking
• Securities Trading and Underwriting
• Money Management
• Financial Planning
• Risk Management (Insurance)
• All are carried out with the intention to proper
balance profitability against risk.
Companies discussed are for concept application only.
NOT YOUR FINANCIAL ADVISOR
19
Companies discussed are for concept application only.
NOT YOUR FINANCIAL ADVISOR
Figure 1-1
Activities of the Financial Manager
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR20
Forms of Organization
Sole Proprietorship
- one owner
- largest in actual number but smallest in total sales revenue
Partnership
- two or more owners
Corporation
- legal entity unto itself
- smallest in actual number but largest in total sales revenue
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR21
Sole Proprietorship
A business owned by one person
Advantages
Disadvantages
▪Freedom
▪Simplicity
▪Low Starting Costs
▪Tax Benefits
▪Unlimited Liability
▪Lack of Continuity
▪Difficult to raise
money
▪Reliance on one
person
22
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR22
Partnership
A business owned by two or more persons
• Advantages
• Disadvantages
▪More Capital
▪Greater Talent Pool
▪Ease of Formation
▪Tax Benefits
▪Unlimited Liability
▪Lack of Continuity
▪Ownership transfer
is difficult
▪Possibility of
Conflicts
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR23
Corporations
A corporation is a separate legal entity
• Advantages
• Disadvantages
▪Limited Liability
▪Higher Start-Up
Costs
▪Continuity
▪Greater Likelihood of
Professional
Management
▪Easier Access to
Capital
▪More Regulations
▪Double Taxation
▪Potential
Shareholder
Conflicts
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR24
The Role of the Financial Markets:
Public vs. Corporate
Financial markets are a vast global network of organizations
which either need money or have money to lend or invest.
https://www.viddler.com/embed/c3510b77/
PUBLIC
FINANCIAL MARKETS
Used by governments to
borrow funds for public
activities
CORPORATE
FINANCIAL MARKETS
Used by corporations to
raise funds
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR25
Structure and Functions of Financial Markets:
Money Markets vs. Capital Markets
• Money Markets
▪deal in short-term
securities (less than 1 year)
▪e.g. Treasury Bills,
commercial paper
• Capital Markets
▪deal in long-term securities
(greater than 1 year)
▪e.g. common stock,
preferred stock, corporate
bonds, government bonds
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR26
Structure and Functions of Financial Markets:
Primary vs. Secondary Markets
Primary market
is where a firm
issues new
bonds or shares
to raise new
funds.
Secondary market
is where
investors buy
and sell (trade)
outstanding
bonds or shares.
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR27
Risk-Return Tradeoff
Increased Profitability
= Increased Risk
Decreased Profitability
= Decreased Risk
A financial manager must choose appropriate
combination of potential profit (return) and
level of risk (safety).
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR28
Securities in Financial Market
Common Stock
(Common Share)
= Ownership or
Equity
•Shareholders own the
company
Bond = debt or
liability
•Bondholders are owed
money by company
29
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR
29
Companies discussed are for concept application only. NOT
YOUR FINANCIAL ADVISOR
• Financial markets determine value and allocate
capital to the most productive use on a riskRole of
return basis.
Financial • Debt is an important component of a firm’s
Markets capital structure.
• Excessive debt may erode cash flow & increase risk
• Interest rates or yields help establish the
allocation of capital
• Greater risk increases the spread between
inflation and yield
30
Figure 1-2
Prime rate versus percent change in the CPI
Source: Data from Bank of Canada, www.bankofcanada.ca. Material used with the permission of the Bank of Canada
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR31
Summary
&
Conclusions
• Finance links economics and accounting.
• Helps managers make decisions to maximize shareholder
wealth.
• However, managers may pursue their own interests instead
of those of shareholders.
• Agency theory: conflicts between shareholders and
management.
• Financial managers make investment + financing decisions.
• Financial markets are where financial managers raise funds
and given feedback about the effect of their decisions.
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR32
Class Weekly Reflections
• Today I learned
more about……
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR33
HAVE A GREAT SEMESTER
Companies discussed are for concept application only. NOT YOUR FINANCIAL ADVISOR
34