FINAN200-20B (HAM)

Financial Management 1

15 Points

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Division of Management
School of Accounting, Finance and Economics

Staff

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Convenor(s)

Geeta Duppati

Geeta Duppati
9255
MSB.2.29
See Moodle
geeta.duppati@waikato.ac.nz

Lecturer(s)

Administrator(s)

: denise.martin@waikato.ac.nz

Placement/WIL Coordinator(s)

Tutor(s)

Student Representative(s)

Lab Technician(s)

Librarian(s)

: clive.wilkinson@waikato.ac.nz

You can contact staff by:

  • Calling +64 7 838 4466 select option 1, then enter the extension.
  • Extensions starting with 4, 5, 9 or 3 can also be direct dialled:
    • For extensions starting with 4: dial +64 7 838 extension.
    • For extensions starting with 5: dial +64 7 858 extension.
    • For extensions starting with 9: dial +64 7 837 extension.
    • For extensions starting with 3: dial +64 7 2620 + the last 3 digits of the extension e.g. 3123 = +64 7 262 0123.
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Paper Description

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This paper covers capital budgeting and working capital management for private and public sector organisations. Three key important questions are answered in this course: What long-term investments should the firm take on? The cost of long-term financing to pay for the investment? How will we manage the everyday financial activities of the firm?

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Paper Structure

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Lectures

Provide quick access to the whys and how of dealing with the three most important questions in finance: Capital Budgeting, Capital Structure and Working Capital Management. Provide easy-to-understand information, including equations and examples that can be quickly applied to most problems of corporate finance.

Tutorials

All students should attend one tutorial (one hour) per week.

Mobile Phones and Cross Chats

As a courtesy to others, students are strongly urged not to disrupt lecture sessions by using the mobile phones and cross chatting during these sessions. Students are advised to disable their mobile phones during lectures.
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Learning Outcomes

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Students who successfully complete the course should be able to:

  • Identify and explain the use of equities, bonds and bank finance to fund corporate actions (LO1).

    Identify the difference between bonds and stocks. Gaining insights into the bond features. Explain and show how the stock prices affects dividend growth.

    Linked to the following assessments:
  • Understand capital budgeting techniques and the analysis of evaluating projects (LO 2).
    Linked to the following assessments:
  • Apply risk-return analysis and security market line information to company decisions (LO 3).

    Understand how to calculate risk and return and the relation between them. Develop the security market line with an intuitive approach that bypasses much of the usual portfolio theory. Realize the CAPM model and discuss beta estimation.

    Linked to the following assessments:
  • Understand financing choices relevant to the life-cycle of the firm (LO 4).

    .

    Linked to the following assessments:
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Assessment

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Content/Foundational Skill: Both critical-thinking and problem-solving questions will be included in the Assignments, Midterm Test, and Final Test. The critical-thinking questions (i.e., short essay questions) will be evaluated by Communication Skills, Professionalism and Innovation. There is an expectation that students demonstrate academic integrity when they attempt the assignments in this paper. Moreover, referencing academic research articles to answer the questions will be rewarded in terms of marks (But referencing non-academic websites, such as Investopedia, will not have a reward). The design is to motivate students to achieve effective academic reading.

The critical-thinking questions also allow for the evaluation of effective academic reading by students as their answers will demonstrate their understanding of the concepts explored in the paper. And the short essay questions require students to demonstrate their business writing ability. For the problem-solving questions (i.e., calculation questions), students are required to show all their workings. These questions require students to perform calculations on data and then to demonstrate their understandings of the numbers calculated, and thus equip students with numeracy skills/using data.

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Assessment Components

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The internal assessment/exam ratio (as stated in the University Calendar) is 100:0. There is no final exam. The final exam makes up 0% of the overall mark.

The internal assessment/exam ratio (as stated in the University Calendar) is 100:0 or 0:0, whichever is more favourable for the student. The final exam makes up either 0% or 0% of the overall mark.

Component DescriptionDue Date TimePercentage of overall markSubmission MethodCompulsory
1. Online Quizzes
20
  • Online: Submit through Moodle
2. Mid-term Test
20 Aug 2020
6:00 PM
20
  • Online: Submit through Moodle
3. Final Test
8 Oct 2020
6:00 PM
30
  • Online: Submit through Moodle
4. Individual Assignment
27 Oct 2020
3:00 PM
30
  • Online: Submit through Moodle
Assessment Total:     100    
Failing to complete a compulsory assessment component of a paper will result in an IC grade
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Required and Recommended Readings

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Required Readings

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Fundamentals of corporate finance

Book by S.A. Ross; R.W. Westerfield; B.D. Jordan

12th Edition, Mc Graw Hill Education.

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Other Resources

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Studiosity

MindTap, providing topic features - websites, practice exercises,videos and questions on a weekly basis.

Weekly references to an online news item relating to the topics

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Online Support

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Lecture slides, tutorial resources and related teaching materials will be available in Moodle.

Studiosity

MindTap

Cengage App downloadable from Google play provides mobile access to Text book and MindTap support.

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Workload

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The course has 36 (3 X 12) contact hours (lectures and tutorials). The rest of the 150 hours expected workload in this 15-point paper can be distributed as follows: 20 hours to complete the Assignment, 35 hours to prepare for and attend the Midterm Test and 59 hours to prepare for and attend the Final Exam.

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Linkages to Other Papers

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There is a significant interrelationship between finance and non-finance areas. First, finance and accounting are related since accounting information is needed for finance decision. Second, finance and economics are related because economic activity and policy affect finance decisions, and vice versa. Finance and management are related because the management decisions, such as setting salary, hiring new staff and paying bonus must be coordinated with finance. Finance and information system are related because finance decisions rely on information. Last but not least, there are four ps of marketing, product, price, place and promotion. Clearly, the price and promotion, e.g., advisement are related to finance.
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Prerequisite(s)

Prerequisite papers: FINA201 or FINAN101

Corequisite(s)

Equivalent(s)

Restriction(s)

Restricted papers: FINA311, FINA510

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