CORPORATE FINANCE AND INVESTMENT

SHE Level 3
SCQF Credit Points 20.00
ECTS Credit Points 10.00
Module Code M3N306684
Module Leader Sanjukta Brahma
School Glasgow School for Business and Society
Subject Finance and Accounting
Trimester
  • A (September start)

Pre-Requisite Knowledge

M2N322735 Fundamentals of Coprporate Finance or equivalent.

Summary of Content

Rationale. The rationale for this module is to build on the concepts explored in PBF by further development of major investment and financial decisions faced by corporate financial managers. These decisions will impact upon any professional within the corporate environment and thus an understanding of the main issues is important in future professional environments. Summary of content. The module will consider issues such as the valuation of bonds and shares, estimating an appropriate discount rate for investment appraisal, how a company should finance itself, the level of dividends to pay to shareholders, working capital management, leasing and options. Relevant theories will also be explained and appraised. Analyse the methods used by financial institutions to meet the needs of large corporate customers.

Syllabus

Investment appraisal techniques for valuation of Bonds, Shares and Companies Risk, Return and Capital Budgeting Market Efficiency Capital Structure Dividend Policy Working Capital Management and Leasing Treasury Management and Options Assess the creditworthiness of large corporate customers. Analyse the methods used by financial institutions to meet the needs of large corporate customers. Revision.

Learning Outcomes

On successful completion of this module, the student should be able to:1.Understand the objectives of the firm2. Calculate the value of bonds and shares3. Be able to critically appraise valuation techniques.4. Explain the relationship between the risk and return of financial instruments5. Critically evaluate the theoretical and practical issues involved in corporate financial structure and dividend policy decisions6. Understand the main functions of treasury management 7. Demonstrate a knowledge of market efficiency and its implications8. Evaluate the methods of working capital management.9. Describe simple hedging procedures. 10. Asses the creditworthiness of large corporate customers. 11. Analyse the methods used by financial institutions to meet the needs of large corporate customers.

Teaching / Learning Strategy

There will be two hours of lectures each week. Each week will be devoted to learning a topic in increasing depth. Students may also be asked to present their views to class for general discussion. Where appropriate, web-based material will be used to complement the lectures. There will also be one seminar a week (from week 2). Students are expected to keep up to date with the relevant reading and to attempt seminar questions prior to the seminar, where they will be asked to participate and present solutions. Feedback Strategy Students will be provided with feedback on all forms of assessed work within three weeks of submission. They will also receive feedback on all group or individual contributions to the module. The following strategies will be adopted: A: Facilitating the development of self-assessment Students will be asked to identify strengths and weaknesses in their own work in relation to the criteria set out in the marking template before handing the work in for marking. B: Encouraging teacher and peer dialogue The lecturer will review feedback at the tutorials where coursework and other work done by students will be handed back. BB discussion boards are set up to encourage teacher and peer-to-peer dialogue. C: Clarifying good performance A marking template is available for all student course work. This is handed out in advance and discussed with students in a tutorial prior to completion of the assignment. Anonymous examples of good and poor exam work from previous cohorts of students will be handed out, together with markers' comments. D: Providing opportunities to close the gap between current and desired performance In providing feedback, the lecturer will provide action points for students to follow to enable them to improve their performance. At feedback sessions in tutorials students will be asked to identify their own action points, based on the feedback they have just received to involve students more in the generation and planned use of feedback. E: Delivering high quality information about their learning Formative feedback will be provided via online testing and informal tutorial discussions on pre-prepared work. Feedback will be provided within three weeks of summative coursework submission and will provide information on strengths, weaknesses and suggestions for corrective action. Students may also discuss any points with their lecturer or tutor. F: Encouraging positive motivational beliefs and self esteem Feedback give to students will aim to be positive and constructive, with action points for improvement. Formative assessment will be used that will give opportunities for students to receive individual feedback designed to encourage positive motivational belief and self-esteem. G: Providing information to teachers that can be used to shape the teaching Students will be asked to identify where they are having difficulty in assignments and in the course generally through the medium of the staff-student consultative group and the BB site. Discussion boards are set up to discuss and provide feedback on both coursework and also to help in exam preparation.

Indicative Reading

Hillier, D, J., S.A. Ross, R.W. Westerfield, and J.F. Jaffe, Corporate Finance (Latest Edition), Irwin. Other useful books are - The main text is Corporate Finance and Investment by Pike R and Neale B, 6th edition. 2009 Introduction to Corporate Finance by William L Megginson and Scott B Smart, 1st edition. R.A. Brealey, S. Myers, and A.J. Marcus, Fundamentals of Corporate Finance (latest Ed). R.A. Brealey, S. Myers, Principles of Corporate Finance (5th Ed), , McGraw Hill. Glen Arnold, Fundamentals of Corporate Financial Management (2nd Ed), Prentice Hall. Other financial papers such as The Economist, The Financial Times, and The Investors Chronicle are useful for background information and up-to-the-minute developments. Appropriate level journal articles.

Transferrable Skills

Professional, practical and business skills Research Skills which will be reflected in assessed essays in exam. Critical evaluation and interpretation skills which will be assessed in class test and exam. Numeracy skills which will be which will be assessed in class test and exam. Group work skills which will be included in seminar preparation. All skills are developed during the assessment process and seminars.

Module Structure

Activity Total Hours
Seminars (FT) 11.00
Lectures (FT) 24.00
Independent Learning (FT) 147.00
Assessment (FT) 18.00

Assessment Methods

Component Duration Weighting Threshold Description
Exam (Exams Office) 2.00 60.00 35% Final Examination
Coursework 0.00 40.00 35% Individual Report (2,000 words).