643 Corporate Financial Management (502)

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643 Corporate Financial Management (502)

Teaching Staff:

Associate Professor K. Gary McClure, PhD

Assistant Professor: Doc. dr. sc. Lidija Dedi

Office: EDABA Visiting Professor Office, 405

Phone: 098 615 531

Email: [email protected]

Office Hours: By Appointment.

Course Content Outline:

This course is a practical introduction to the overall field of finance and specifically corporate financial management and its role, activities, and contribution within the overall business enterprise. Specific course subjects include:

An Overview of Financial Management & the Financial Environment

Financial Statement Analysis

Financial Planning & Forecasting

Time Value of Money

Financial Risk & Return

Bonds and Their Valuation

Stocks and Their Valuation

The Cost-of-Capital

The Basics of Capital Budgeting

Cash Flow Estimation & Risk Analysis

Corporate Valuation & Value-based Management

Capital Structure Decisions

Distributions to Shareholders

The course will provide the student with an understanding of the relationship between finance and other corporate departments and will emphasize the decisions commonly made by financial managers and the quantitative techniques and computer applications used in making these important corporate decisions. The knowledge and understanding gained in this course will serve you well in your future business or professional careers regardless of your specific discipline and will establish a base from which those of you with interests in finance can continue to grow and develop your analytical and management skills.

Learning and Teaching:

A combination of lecture, group projects, homework, class discussion, and question-andanswer will be used. Computer applications to finance will be discussed throughout the class sessions and in the assignments. Students are recommended to obtain a financial calculator or laptop computer and your instructor will use the Hewlett-Packard 10BII as well

as a computer in class. Please note that the course introduces computer applications in financial analysis and develops "real-world" computer skills for the student as well as developing the written communications skills required to present the results of the analyses performed.

Computer Project:

The Macbro Computer Project (distributed separately) is an integral part of the course and will be accomplished in groups of 3-5 students with each group member receiving the same group grade. The project is in two (2) parts covering: Financial Planning

& Forecasting and Capital Budgeting. The project will build on the course material studied.

By the end of the course you will have created on a computer, (1) a 5-year Financial Plan &

Forecast for a corporation (including debt and equity financing), analyzed the results, and presented a written report of your findings and recommendations and (2) evaluated of a series of capital budgeting projects, analyzed the results, and presented a written report of your findings and recommendations.

Media Report:

During the course each student is to provide one (1) brief report

(approximately 2-3 pages) on a finance subject of interest to the student that is relevant to the course, and has been published in a current news/magazine article. Each report should properly reference the article in a footnote, briefly summarize the selected subject in a section titled

“Summary of Article”

, and,

most importantly

, present your personal assessment/critique/opinion of article in a section titled

“Assessment of Article”

. Pages must be numbered and stapled together in order. The selection of the subject is yours and is to be submitted as indicated in the Course Schedule.

Homework:

Each student will complete and submit two (2) homework assignments during the course. These assignments will be distributed separately. Both your answers to the problems and all work must be shown for full credit.

Learning Resources:

Prescribed Textbook:

“Financial Management: Theory and Practice,” Eugene F. Brigham & Michael C. Ehrhardt,

Thompson /South-Western, 11 th

Edition, 2005.

Assessment:

Students are expected to read, study, and understand the chapter text material including the

“Case” at the end of each chapter prior to class. It is also recommended strongly that the student complete selected End of Chapter Problems (Solutions in Appendices) for practice and familiarization with financial mathematics.

There will be one (1) mid-term and one (1) final exam (1) required during the course. The

Final Exam will cover all the material in course. The exams will be closed-book but students may bring a copy of Appendix “C” from the textbook and a calculator to both exams. Any student late for an exam will not be given any additional time to complete.

ANY ASSIGNMENT TURNED IN LATE WILL LOSE AT LEAST ONE FULL GRADE

POINT OR IT WILL BE GIVEN A MAXIMUM OF HALF CREDIT, IF IT IS MORE

THAN ONE WEEK LATE. ANY ASSIGNMENT OR TEST MISSED WILL RECEIVE

A GRADE OF 0%.

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Your final grade will be determined by the Mid-term Exam (20%), the Final Exam (40%) the Computer Project (20%), the Media Report (10%), and Homework Assignments (10%).

Progression:

Prerequisites:

Approval of Economics & Business International Program (EBIP) Office

Recommended Readings:

Your textbook has practical example cases and suggested articles that supplement the course and contribute to the learning experience for the student.

Recommended Information Sources & Websites:

The World Bank: http://www.worldbank.org

The International Monetary Fund: http://www.imf.org

The Organization for Economic Cooperation and Development: http://www.oecd.org

The European Union (USA Site): http://www.eurunion.org

Yahoo Finance: http://finance.yahoo.com/

The Securities and Exchange Commission: http://www.sec.gov

Hoovers Online (General Corporate/Business Information): http://www.hoovers.com

The Wall Street Journal (Current Corporate/Business Information): http://www.wsj.com

The Economist (Current Corporate/Business Information): http://www.economist.com

3

Week/

Date

1

23/4-27/4

2

30/4-4/5

May 8

May 9

May 10

May 15

May 16

May 17

May 22

May 23

May 24

May 29

May 30

May 31

June 5

June 6

June 7

June 12

June 13

June 18-

22

Summer

2007

Chapters

Covered

Ch 1-2

Tutorial

University of Zagreb

Graduate College of Economics & Business

EBIP Corporate Financial Management

Course Schedule

Spring 2007

Instructor

Dedi

Special Instructions/Notes

Overview & Financial Environment

Computer Cases

Dedi Financial Statements, Cash Flow & Taxes Ch 2-3

Tutorial

Ch 13

Tutorial

Ch 14

Ch 4

McClure

Dedi

McClure

McClure

Financial Statement Analysis

Financial Planning & Forecasting

Risk & Return (Basics)

Tutorial

Ch 6

Ch 7

Tutorial

Ch 9

Ch 10

Mid-term Exam

Ch 11

Ch 15

Tutorial

Ch 16

Ch 18

Tutorial and

Review

Final Exam

&

Computer Case 2

Dedi

McClure

McClure

Dedi

McClure

McClure

Dedi

Dedi

Note: Turn in Homework #1

Bond Valuation

Stock Valuation

Tutorial

Cost of Capital

Capital Budgeting (Basics)

Mid-Term Exam

In-Class: Closed Book, (copy of Appendix C permitted)

Chapters 1-4, 6-7, 13-14

Note: Turn in Computer Case 1

Cash Flow Estimation & Risk Analysis

Corporate Valuation & Value-based Management

Note: Turn in Media Report

Capital Structure Decisions (Basics)

Distributions to Shareholders

Note: Turn in Homework #2

Final Exam

In-Class: Closed Book, (copy of Appendix C permitted)

Chapters 1-4, 6-7, 9-11, 13-16, 18

Note: Turn in Computer Case 2

Good luck with the rest of your EBIP courses Zivjeli! Vi ste financijski carobnjaci!!

McClure

McClure

Dedi

McClure

McClure

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