This is an introductory finance course that addresses the key decisions and issues faced by senior financial officers in corporations and provides the analytical frameworks and approaches that are employed to resolve these issues. The goal is to ensure all students, regardless of career aspirations, gain an appreciation for the financial issues facing all companies and the analytical tools that are useful in addressing these issues. The major modules in this course are:
- Assessment of financial performance
- Introduction to financial markets and capital raising
- Determination of optimal capital structure
At the end of the assessment of financial performance module, students will be able to:
- Define alternative corporate objectives and explain how a financial manager’s perspective impacts his/her decision-making; and,
- Define major categories of financial ratios and identify signs of organizational strengths and weaknesses using data from financial statements.
At the end of the introduction to financial markets, securities, and alternatives for raising capital module, students will be able to:
- Identify differences between types of financial securities and explain how these differences should affect the desirability of securities from the perspective of organizations (issuers) and investors; and,
- Describe the pattern of promised cash flows arising to investors from debt and equity securities and compute their discounted present values.
At the end of the determination of an optimal capital structure module, students will be able to:
- Identify key capital structure decision-making criteria emerging from Modigliani and Miller’s theory, and evaluate alternative capital structures against those criteria; and,
- Apply scenario analysis to determine the impact of different financing alternatives on an organization’s risk and return.