EASTERN MEDITERRANEAN UNIVERSITY
FACULTY OF BUSINESS AND ECONOMICS
DEPARTMENT OF BANKING AND FINANCE AND DEPARTMENT OF BUSINESS ADMINISTRATİON
SPRING 2010-2011
COURSE TITLE
COURSE TYPE
LECTURER
FINA/MGMT
COURSE
517
LEVEL
Corporate Finance
Area Core
Assoc.Prof.Dr. Cahit Adaoğlu
CREDIT VALUE
3 Credit Hrs.
COURSE CODE
2nd Semester (Graduate Course)
ECTS VALUE
6
I expect that everybody is familiar with basic financial concepts (FINA301) and knows
how to use a financial calculator and Microsoft Excel.
COREQUISITES
None
DURATION OF COURSE
One Semester (15 weeks)
ROOM AND TEL. NO.
BE 261 (FBE Building II), 630 2116 or 630 1475 (Secretary)
Mondays before class 15.30-16.20/Thursdays before class 10.30-12.20 or feel free to
OFFICE HOURS
contact for an appointment at other times e-mail: cahit.adaoglu@emu.edu.tr
http://www.emu.edu.tr/~cadaoglu (Instructor Web Link)
Note: The course website may be moved to http://fbemoodle.emu.edu.tr later in the
WEB LINK
semester. You will be notified of this change.
http://highered.mcgraw-hill.com/sites/0073286982/student_view0/index.html (Textbook Web Link)
CATALOGUE DESCRIPTION AIMS & OBJECTIVES
The aim of the course is to analyze the primary issues in modern corporate financial theory and practice. The focus will
be on the corporate practice (corporate financial policies) that will create value and maximize the wealth of
shareholders. We will be concerned with what financial managers do and why, and how the theory of finance explains.
The course is designed in line with the subject topics covered in the Chartered Financial Analysts (CFA) Exam (Level I) (see
http://www.cfainstitute.org).
PREREQUISITES
GENERAL LEARNING OUTCOMES (COMPETENCES)
On successful completion of this course, all students will have developed knowledge and understanding of:
- Corporate Form of Organization
- Corporate Governance
- Brief Overview of Capital Budgeting
- Capital Markets and Capital Structure
- Debt Policy
- Payout Policy
On successful completion of this course, all students will have developed their skills in:
- Understanding of the Corporate form of organization and governance
- Applying capital budgeting tools and understanding the differences among the tools
- Understanding how the corporations finance and the processes
- Understanding the factors that affect the capital structure
- Understanding the factors that affect the dividend policy
On successful completion of this course, all students will have developed their appreciation of and respect for values
and attitudes regarding the issues of:
- The challenges faced by a financial manager
- The complexities and required skills in finance
- The importance of investments as a core personal skill in their future careers
RELATIONSHIP WITH OTHER COURSES
This course lays the foundation for all other finance related courses and must be taken by students interested in finance
LEARNING / TEACHING METHOD AND ASSIGNMENTS
Class sessions will be devoted to the discussion of readings, chapter assignments/problems, and mini-cases. Chapter
assignments/problems from each textbook chapter are announced in the course website. Therefore, please
follow the lectures closely and if you miss a lecture, get in touch with one of your classmates or with me.
In order for everyone to derive the maximum benefit from the classes, it is important to do the assigned reading and
chapter problems. The only way to master this material is by solving problems/practice questions and by doing the
assigned reading. Written work will consist of excel applications, mini-cases, and two exams.
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METHOD OF ASSESSMENT
Exam I
35%
Exam II
50%
Mini-Cases
15%
If you do experience difficulty in this course, please contact me as soon as you sense you are having trouble. I will be
glad to help you.
TEXTBOOK/S
R.A. Brealey, S. C. Myers, & F. Allen. Corporate Finance, 9th edition, McGraw-Hill Irwin, 2008.
INDICATIVE BASIC READING LIST
1. Selected articles and distributed in class from J. M. Stern and D. H. Chew. The Revolution in Corporate Finance.
4th Ed., Blackwell Publishing, 2003.
2. I strongly recommend that you regularly follow daily financial newspapers such as Dünya (in Turkish) and The Wall
Street Journal Europe or The Financial Times.
SEMESTER OFFERRED
2010-2011 Spring Semester
CONTENT & SCHEDULE
Lectures will be held on Mondays (16.30 - 19.00) in BEA3 for FINA517 and Thursdays (12.30 - 15.00) in BEA3 for
MGMT517. The lecture topics within the semester are as in the following schedule (Please note that the dates in
parentheses are for MGMT517):
Lec
Date
Topic(s)
Chapters
Wk
21/02/2011
1
Chp. 1: Finance and the Financial Manager
(24/02/2011) Introduction to
Chp. 2: Present Values, The Objectives of the Firm, and Corporate
Corporate Finance
28/02/2011
Governance
2
(03/03/2011)
07/03/2011
Corporate
3
Chapter 34: Governance and Corporate Control around the World
(10/03/2011) Governance
14/03/2011
4
(17/03/2011)
Chp. 6: Why Net Present Value Leads to Better Investment
Capital Budgeting
Decisions than Other Criteria
21/03/2011
5
(24/03/2011)
6
7
8
9
10
26/03-06/04/2011
EXAM I (Midterm Exam Period)
11/04/2011
(14/04/2011)
18/04/2011
(21/04/2011)
Capital Markets &
Corporate Financing
Decisions
02/05/2011
(05/05/2011)
09/05/2011
(12/05/2011)
16/05/2011
Holiday 19/05/2010
Debt Policy
Payout Policy
Chp. 15: An Overview of Corporate Financing
Chp. 16: How Corporations Issue Securities
Chp. 18: Does Debt Policy Matter?
Chp. 19: How Much Should a Firm Borrow?
Chp. 25: The Many Different Kinds of Debt (Reading Assignment)
Chp. 17: Payout Policy
23/05-07/06 EXAM II (Final Exam Period)
PLAGIARISM & MAKE-UPS
This is intentionally failing to give credit to sources used in writing regardless of whether they are published or
unpublished. Plagiarism (which also includes any kind of cheating in exams) is a disciplinary offence and will be dealt
with accordingly. Students who have valid excuses will be allowed to take make-up examinations for all exams.
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