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JOHN CABOT UNIVERSITY

COURSE CODE: "FIN 301-2"
COURSE NAME: "Finance "
SEMESTER & YEAR: Fall 2017
SYLLABUS

INSTRUCTOR: Silvia Pulino
EMAIL: [email protected]
HOURS: TTH 8:30-9:45 AM
TOTAL NO. OF CONTACT HOURS: 45
CREDITS: 3
PREREQUISITES: Prerequisites: FIN 201, FIN 202, EC 202, MA 208
OFFICE HOURS: By appointment

COURSE DESCRIPTION:
This course examines both the theoretical and applied foundations required to make decisions in financial management. The main areas covered include an  overview of the financial system and the efficiency of capital markets, evaluation of financial performance, time value of money, analysis of risk and return, basic portfolio theory, valuation of stocks and bonds, capital budgeting, international financial management, capital structure management, and the CFA Institute Code of Ethics and Standards of Professional Conduct.
SUMMARY OF COURSE CONTENT:
The operations of financial markets and their efficiency, financial statement analysis, international financial transactions, time value of money, analysis of risk and return, valuation of financial assets (stocks and bonds), capital budgeting, and capital structure. Emphasis is given to both theory and application with particular attention on using spreadsheets for analysis of real world financial data and the preparation of brief financial reports.
LEARNING OUTCOMES:
  • Overall: to develop the qualities of understanding, judgement and communication leading to action.
  • Provide a broad survey of major areas of finance: corporate finance, investments, and financial markets.
  • Provide a strong background to major financial decision making tools: financial statement analysis, time value of money, risk and return.
  • Introduce students to concepts and techniques in financial management and securities’ valuation.
  • Introduce students to capital budgeting and project evaluation.
  • Improve the ability to communicate financial topics in short reports and presentations.
  • Develop spreadsheet skills.
  • Understand the importance of ethical issues in finance.

 

Key skills taught

-          Communication: effectively communicate own thoughts in class; clearly present numerical work; persuasively recommend the chosen solution

-          Numeracy: understand the relationship between variables such as cost of capital, capital structure and dividend policy; prepare budgets and forecasts; appropriately apply formulae and navigate the intricacies of real-life calculations

-          Information Technology: use Excel to create working financial models

-          Interpersonal skills: collaborate when working as a team to arrive at the desired end product (primarily case preparation and presentation)

-          Individual skills: monitor and review own progress, seek feedback and/or special coaching from instructor if needed, meet a challenging course with determination

TEXTBOOK:
Book TitleAuthorPublisherISBN numberLibrary Call NumberComments
Corporate FinanceMichael C. Erhardt, Eugene F. BrighamSouth-Western Cengage Learning, 4th edition9781439078112 A financial calculator is required for exams. Other computing devices (such as laptops or smart phones) that can access the Internet will not be allowed during tests and the final exam. Students are advised to get a financial calculator early on in the course, so they have time to learn how to use it and feel familiar with it. WARNING: SHIPPING IT FROM THE UNITED STATES WILL BE COSTLY AND CUMBERSOME.
REQUIRED RESERVED READING:
NONE

RECOMMENDED RESERVED READING:
NONE
GRADING POLICY
-ASSESSMENT METHODS:
AssignmentGuidelinesWeight
Class preparation and participationThe class participation grade will reflect preparation, attendance and quality and frequency of participation. Class preparation will require students to read all the assigned material and, at the end of each unit, to practice problems at home for further discussion in class. Class participation will help students understand the material better and build confidence in public speaking. In each class, I will ask a student to make a brief presentation of the material s/he prepared, but all students are encouraged to participate in almost every class at least once and if possible more than once, actively engaging in the debate. The instructor may also indicate university open lectures that are relevant to the course; students are expected to attend such lectures (unless there is a scheduling clash with another course) as part of their class participation activities. Assignments and deadlines will be posted on Moodle. Students are required to sign up and keep up to date with all Moodle postings for the course.10%
One GROUP written assignments The course will include a special assignment that students will have to develop and report on in groups. The assignment topic may be one of the following: - Valuation using the DGM model and the multiples approach (group work) - Valuation using the DCF method (group work) - Capital Budgeting Report (group work) - Financial forecasting for a growing firm 20%
Comprehensive final examThe final examination is comprehensive and will test students on all the topics covered throughout the course. The exam will require the use of a financial calculator.30%
Mid-Term ExamsThere will be two mid-term exams. The first exam will cover Cash Flows, Financial Statement Analysis and Financial Planning and Forecasting. The second exam will cover time value of money, risk analysis, and valuation. There will be no make-up for a missed exam. For students with good attendance (see policy below), the grade on the final exam will substitute the grade on the mid-term exams if higher. 40%

-ASSESSMENT CRITERIA:
AWork of this quality directly addresses the question or problem raised and provides a coherent argument displaying an extensive knowledge of relevant information or content. This type of work demonstrates the ability to critically evaluate concepts and theory and has an element of novelty and originality. There is clear evidence of a significant amount of reading beyond that required for the
BThis is highly competent level of performance and directly addresses the question or problem raised.There is a demonstration of some ability to critically evaluatetheory and concepts and relate them to practice. Discussions reflect the student’s own arguments and are not simply a repetition of standard lecture andreference material. The work does not suffer from any major errors or omissions and provides evidence of reading beyond the required assignments.
CThis is an acceptable level of performance and provides answers that are clear but limited, reflecting the information offered in the lectures and reference readings.
DThis level of performances demonstrates that the student lacks a coherent grasp of the material.Important information is omitted and irrelevant points included.In effect, the student has barely done enough to persuade the instructor that s/he should not fail.
FThis work fails to show any knowledge or understanding of the issues raised in the question. Most of the material in the answer is irrelevant.

-ATTENDANCE REQUIREMENTS:

Students are expected to come to class and to arrive on time.

Absences: Students are encouraged to attend and participate in class as part of their learning.  As the final is comprehensive, students who miss 3 classes or less will have the option of dropping TWO of the grades obtained in the topic tests (i.e. only the top three grades will be averaged for that portion of the grade).

Tardiness: students arriving more than 5 minutes late for class will be marked as absence (though they may stay and follow the lesson).

Persistent absence or tardiness usually precludes satisfactory performance in the course, and will result in a lower class participation grade. In any case, students are responsible for all material covered by the syllabus and/or discussed in class, whether or not they are actually present.

Late submission of work:

All assignments should be completed and handed in to the professor no later than the beginning of the specific class meeting.  Papers received after this deadline will not be accepted, and consequently will be recorded as ZERO, unless prior arrangements are made with the professor. In any case, should the professor accept late work, 5 percentage points will be detracted from the assignment’s grade as a late penalty.

ACADEMIC HONESTY
As stated in the university catalog, any student who commits an act of academic dishonesty will receive a failing grade on the work in which the dishonesty occurred. In addition, acts of academic dishonesty, irrespective of the weight of the assignment, may result in the student receiving a failing grade in the course. Instances of academic dishonesty will be reported to the Dean of Academic Affairs. A student who is reported twice for academic dishonesty is subject to summary dismissal from the University. In such a case, the Academic Council will then make a recommendation to the President, who will make the final decision.
STUDENTS WITH LEARNING OR OTHER DISABILITIES
John Cabot University does not discriminate on the basis of disability or handicap. Students with approved accommodations must inform their professors at the beginning of the term. Please see the website for the complete policy.

SCHEDULE

The following schedule is tentative and subject to change.  The up-to-date schedule and assignments will be posted on Moodle.

 

 

Class

 

Date

Topic

Activities

Read

1

 

 

Introduction.

 

 

2

 

 

Financial Statements, Cash Flow and Taxes

Assessment test (ungraded)

Chapter 2

3

 

 

Financial Statement Analysis  (MicroDrive)

 

Chapter 3

4

 

 

FSA – continued

EVA. Du Pont System. ROIC. FCF.

In-class exercise: Drivers of Industry Structure

Practice Problems ch. 3

 

5

 

 

Financial Planning and Forecasting Financial Statements

Review FCF and Industry Drivers. AFN.

Compute FCF for Microdrive

Complete Industry Drivers exercise

Chapter 12

6

 

 

Financial Planning – continued

Sensitivity Analysis

 

 

 

7

 

 

Time Value of Money

Practice Problems Ch. 12

Chapter 4

8

 

 

TVM (continued)

 

 

9

 

 

TVM (continued)

Bilbo Baggins and other problems

 

Practice Problems Ch. 4

Review Quizz

 

10

 

 

Mid-Term Exam

Cash Flows, Financial Statement Analysis, Financial Planning and Forecasting

 

 

11

 

 

Bonds, Bond Valuation and Interest Rates

 

Chapter 5

12

 

 

Guest Speaker: Alessandro Angeletti

How to Value a Startup

 

 

13

 

 

Bonds (continued)

 

 

14

 

 

Bonds (continued)

 

 

15

 

 

Risk, Return and the Capital Asset Pricing Model

 

Chapter 6

16

 

 

(continued)

 

 

17

 

 

Stocks, Stock Valuation and Stock Market Equilibrium

 

Chapter 7

18

 

 

Exxon Valuation

 

 

19

 

 

Guest Speaker: Mauro Valenti

Finance in the Corporate World

 

 

20

 

 

Cost of Capital

 

Chapter 9

 

21

 

 

(continued)

 

 

22

 

 

Capital Budgeting and Risk

Exxon Valuation Due

Chapter 10

23

 

 

(continued)

 

 

 

24

 

 

Capital Budgeting Report

 

 

25

 

 

Cash Flow Estimation and Risk Analysis

 

Chapter 11

26

 

 

(continued)

Capital Budgeting Report Due

 

 

27

 

 

Athletics Valuation (DCF)

 

 

28

 

 

REVIEW

Athletics Valuation Due

 

 

 

TBD

FINAL EXAM