Fundamentals of Financial Management
| Module title | Fundamentals of Financial Management |
|---|---|
| Module code | BEAM047 |
| Academic year | 2024/5 |
| Credits | 15 |
| Module staff | Dr Monika Tarsalewska (Lecturer) |
| Duration: Term | 1 | 2 | 3 |
|---|---|---|---|
| Duration: Weeks | 11 |
| Number students taking module (anticipated) | 420 |
|---|
Module description
Summary:
Fundamentals of Financial Management will take you through an appraisal of models and issues arising in the area of financial management. This module introduces you to corporate finance theory and financial management. It covers techniques for capital budgeting, the role of risk in capital budgeting, and the cost of capital. It introduces the topic of financial markets, covering the notion of portfolio diversification leading to simple asset pricing models. It analyses models and evidence relating to a firm’s optimal capital structure. It discusses mergers and acquisitions, followed by introduction to corporate governance.
Additional Information:
Internationalisation
Investment theory and corporate finance are international by nature and the principles taught can be applied in any country.
External Engagement
The module is linked with various professional bodies like CISI (Chartered Instituted of Securities and Investment) and CFAI (Chartered Financial Analysts Institute).
Employability
This module covers many different aspects of finance and prepares the students for employment in different financial sectors. Students acquire quantitative skills, analytical skills, problem-solving, team-working, and communication skills.
Sustainability
The entire module is about the fair valuation of financial assets which is of interest to those involved in sustainability. Access to sources of financial data and financial information, lectures and case study material is available for all students online.
Module aims - intentions of the module
The aim of the module is to introduce students to the subject of financial management. In particular the module provides students with a critical understanding of the basic concepts of investment and financing decisions, risk and return in financial markets, and their implications for the financial decisions made by both investors and corporations, including capital budgeting techniques and the valuation of bonds and stocks. Through a combination of lectures and tutorial classes, students will be provided with a solid foundation in financial theory and practice, providing the necessary grounding for further modules in
finance.
Intended Learning Outcomes (ILOs)
ILO: Module-specific skills
On successfully completing the module you will be able to...
- 1. explain the concepts of risk and return in financial markets;
- 2. analyse and use models of portfolio diversification and asset pricing;
- 3. explain and demonstrate the principles of valuing common stocks and bonds;
- 4. explain the concept of the cost of capital and estimate the cost of capital for a corporation;
- 5. evaluate the attractiveness of real investment projects based on their expected cash flows and the cost of capital;
- 6. explain and discuss the factors that determine a corporation's capital structure policy;
ILO: Discipline-specific skills
On successfully completing the module you will be able to...
- 7. develop theoretical arguments based on analytical reasoning;
- 8. rigorously analyse problems in finance;
- 9. interpret financial data and problems in the light of established theories.
ILO: Personal and key skills
On successfully completing the module you will be able to...
- 10. plan and manage their own study;
- 11. make appropriate use of learning resources;
- 12. critically analyse problems arising in both academic and practical contexts.
Syllabus plan
- Introduction to corporate finance
- Time value of money
- Valuing bonds and stocks
- Investment appraisal I
- Investment appraisal II
- Introduction to portfolio theory and CAPM
- Behavioural finance and market efficiency
- Capital structure
- Mergers and acquisitions
- Corporate governance and responsible business
- Revision
Learning activities and teaching methods (given in hours of study time)
| Scheduled Learning and Teaching Activities | Guided independent study | Placement / study abroad |
|---|---|---|
| 30 | 120 | 0 |
Details of learning activities and teaching methods
| Category | Hours of study time | Description |
|---|---|---|
| Scheduled Learning & Teaching activities | 20 | Lectures |
| Scheduled Learning & Teaching activities | 10 | Seminars with assigned problem set |
| Guided Independent Study | 120 | Reading, preparation for classes and assessments |
Formative assessment
| Form of assessment | Size of the assessment (eg length / duration) | ILOs assessed | Feedback method |
|---|---|---|---|
| Problem Sets | 10 hours | 1-12 | Interpretation and discussion of correct answers during seminars |
| Mock exam paper | 2 hours | 1-12 | Suggested solutions |
| ELE quiz | 40 minutes | 1-7 | Suggested solutions |
Summative assessment (% of credit)
| Coursework | Written exams | Practical exams |
|---|---|---|
| 0 | 100 | 0 |
Details of summative assessment
| Form of assessment | % of credit | Size of the assessment (eg length / duration) | ILOs assessed | Feedback method |
|---|---|---|---|---|
| Written examination | 70 | 2 hours | 1-12 | Suggested solutions |
| MCQ test | 30 | 1 hour | 3-5, 7-12 | Suggested solutions |
Details of re-assessment (where required by referral or deferral)
| Original form of assessment | Form of re-assessment | ILOs re-assessed | Timescale for re-assessment |
|---|---|---|---|
| Final Written Examination (70%) | Written examination 2 hours (70%) | 1-12 | August Examination Period |
| MCQ test (30%) | Written examination 1 hour (30%) | 1-12 | August Examination Period |
Indicative learning resources - Basic reading
Recommended textbooks:
- BMAE - Brealey, Myers, Allen, Edmans., 2023, Principles of corporate finance, 14th Edition, New York : McGraw-Hill Education
- https://encore.exeter.ac.uk/iii/encore/record/C__Rb4840237?lang=eng
Indicative learning resources - Web based and electronic resources
Given before each lecture and seminar via ELE
Indicative learning resources - Other resources
Provided via ELE
| Credit value | 15 |
|---|---|
| Module ECTS | 7.5 |
| Module pre-requisites | None |
| Module co-requisites | None |
| NQF level (module) | 7 |
| Available as distance learning? | No |
| Origin date | 17/07/2014 |
| Last revision date | 16/04/2024 |
