Finance 400 offers an advanced level of corporate finance. It assumes that the students have learned an introductory course in finance. This course will focus on some specific topics in corporate financial management. These topics include risk and return, capital budgeting, the valuation of free cash flows, terminal value of the project, the capital structure tradeoff, the issues of financially distressed firms, the dividend policy vs. share repurchase, the interaction between investment and financing decisions, the benefits of mergers /acquisitions, etc.

At the beginning of each class meeting, I discuss "What is news" keeping students informed about updated economic news, FOMC possible move on interest rate, upcoming important earning announcements, merger/acquisition announcements, and other corporations announcements. Especially, students are encouraged to participate in discussing current news in financial markets. The course provides an appropriate combination of theoretical knowledge with practical issues in the arena of financial management.

Additionally, this class requires students to work on case study as well as computerized financial analysis. Each case should be completed with the help of spreadsheet exercises or other relevant software. This "learning by doing" experience obtained from case study has been valued greatly by my previous students.

II. Course Objective

The purpose of this course is designed to help students understand the more advanced financial management knowledge and further develop scenarios analyzing skills accompanied by computer proficiency. The methodology used to achieve this objective is the active involvement in hand-on case studies and discussion during class meetings. Students are expected to apply financial management knowledge and relevant financial empirical models taught in class to each case study. Through the whole semester, students are strongly encouraged to communicate the ongoing progress of their case reports with the instructor. This learning experience should be interactive rather than passive.

While the cases focus on a particular finance subject, all discussion should be related to a global business environment, including but not limited to finance, economics, marketing, management, technology, politics, etc. Thus, enhancing a better understanding of firms business operation as well as strategic decisions making processes, students are expected to read daily business news (on paper or on internet) and particularly pay much more attention to the headline news occurred in market. At the end, students with solid performance in this course are expected to thrive in a real corporate world.

 

III. Course Organization

Course Material - The required text is Aswath Damodaran, " Corporate Finance, Theory and Practice", John Wiley & Sons, Inc. 2nd edition.  

The recommended computer skill and other supplementary readings

Microsoft application (Word, Power Point and Excel)

Wall Street Journal, Business Week, Internet electronic sources (ex. Yahoo business summary, stock quotation, CBS Market Watch, CNN financial news, etc.)

All supplementary teaching material and notes will be distributed in the class. Problems solving will be demonstrated in class. In addition, text reading will be assigned in class. Since all the above requirements will be included in exams, for students missing the class, they need to ask for copies of distributed material and notes from the instructor or their classmates.

 

Course Evaluation

Participation (attendance, discussion, and text reading)                           50 points

Assignment/Quiz (each is 10 points and can drop the lowest score)      50 points

Three cases                                                                                                   120 points

Two Midterms (40% of lowest score and 60% of highest score)             200 points

Final exam (comprehensive)                                                                        150 points

Total Points                                                                                                  570 points

Course Policy

All drop-add policy complies with the University/College rules.

The case study can be an individual report but a group report is preferred. The maximum number of people in one group is 5.

The maximum length of each case report is 10 pages, not including the spreadsheets or other supplementary notes. The first page of the case report is an executive summary, which provides a brief summarized findings and recommendations.

Late case report will be penalized 20 points. Late case report is defined as the report should be submitted no later than ONE day grace period (before 5:00 pm) after the original due date. The case report will NOT be accepted if it is submitted after this grace period.

Dates of changing exams and other information concerning exams will be announced in the class. Instructor reserves the right to change the syllabus based on the progress made in the class.

ATTENDANCE IS REQUIRED.

IV. Course Outline