Kurso programos

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CORPORATE FINANCE (BS at Vilnius University 3'rd year International Business Group)

                                VILNIUS UNIVERSITY   

                                   BUSINESS SCHOOL
 

                                   CORPORATE FINANCE

                                      International Business Group
                               
                                  Prepared by prof. dr. Arvydas Paškevičius


The course Fundamentals of Corporate Finance introduces the fundamentals of financial management of a public company, therefore it may be attended by the students who are only starting to study financial disciplines.

The course of Fundamentals of Corporate Finance covers the concepts of cash flows, the fundamentals of financial analysis and introduces the principles of long-term financial planning and various cases of calculation of time value of money.

The purpose of the course is not only to acquaint the students with the fundamental concepts of corporate managerial finance but also to formulate practical skills while solving elementary financial problems. Therefore, the course includes not only theoretical lectures but also practical work and home assignments. The course consists of 48 hours, 5 credits.


SUBJECT (MODULE) DESCRIPTION



VMA

 

ORGANIZATION OF STUDIES


Dear students

The Rector provides the opportunity to conduct studies remotely.
When organizing studies remotely, we will take advantage of several programs.


First, this page, which contains all the information (lectures, syllabi, exercise tasks, case study tasks, and exam questions).


Second, the VMA e-learning, where you will find pilot tests, an exam that will be held remotely from home and a link to this page.


Third,we will organize lectures, seminars, consultations and exams using the MS teams program. For instructions on how to install MS Teams can be found HOW TO ATTEND A VIDEO LECTURE (Instructions in English are given at the end).

After installing MS Teams, use the link to join the    Corporate Finance (International business 3IBBA)


SCHEDULE

 

Nr.

S.D.

Data

Time

Room

Chapter

Notes

1

Thu

8-Sep

11:00-12:30

211

Introduction to the Course. Introduction to Corporate Finance

2

Thu

8-Sep

13:00-14:30

211

Financial Statements and Cash Flow

Homework: Visit the website https://www.paskevicius.com/kurso_programos/?id=158 Topic 1 test questions

3

Thu

15-Sep

11:00-12:30

211

Introduction to Corporate Finance. The preparation to the test. Financial Statements and Cash Flow

4

Thu

15-Sep

13:00-14:30

211

Financial Statements and Cash Flow

Homework: topic 2 test questions.

5

Thu

22-Sep

11:00-12:30

211

Financial Statements and Cash Flow. The preparation to the test. Working With Financial Statements

6

Thu

22-Sep

13:00-14:30

211

Working With Financial Statements

Homework: Preparing for the test. Self-test

7

Thu

29-Sep

11:00-12:00

EC 108-1, 108-2

Test #1 (Ch 1,2)

If the test is not performed at the exam center, but remotely, then during the test it is mandatory to turn on the MS TEAMS on the phone and point the camera at the computer screen.

8

Thu

29-Sep

12:00-14:30

211

Working With Financial Statements

Homework: Chapter 3 Questions and Problems #1-17,26,29 (page 88-89) Chapter 3 test questions 

9

Thu

6-Oct

11:00-12:30

online

Working With Financial Statements. Practice and the preparation to the test.

10

Thu

6-Oct

13:00-14:30

online

Long-term Financial Planning and Growth

Homework: Chapter 4 Q&P # 1-14 (page 120-123). Chapter 4 test questions

11

Thu

13-Oct

11:00-12:30

online

Long-term Financial Planning and Growth. Practice and the prteparation to the test

12

Thu

13-Oct

13:00-14:30

online

Long-term Financial Planning and Growth. Practice and the prteparation to the test.

Homework: Preparing for the Examination I. Self-test

13

Thu

20-Oct

11:00-12:30

online

Examination I

If the examination is not performed at the exam center, but remotely, then during the examination it is mandatory to turn on the MS TEAMS on the phone and point the camera at the computer screen

14

Thu

20-Oct

13:00-14:30

online

The Time Value of Money. Discounted Cash Flow Valuation.

Homework: Chapter 5 Q&P # 1-10 (page 152-153). Chapter 5 test questions   Chapter 6 Q&P # 1-15 (page 191-192).        

15

Thu

27-Oct

11:00-12:30

online

The Time Value of Money. Practice and the prteparation to the test.

16

Thu

27-Oct

13:00-14:30

online

Discounted Cash Flow Valuation. Practice and the prteparation to the test.

Homework: Chapter 6 Q&P # 1-15 (page 191-192).  Chapter 6 test questions 

17

Thu

3-Nov

11:00-12:30

online

Discounted Cash Flow Valuation. Practice and the prteparation to the test.

18

Thu

3-Nov

13:00-14:30

online

Interest Rates and Bond Valuation

Homework: Chapter 7 Q&P # 1-12, 15 (page 238-239). Chapter 7 test questions

19

Thu

10-Nov

11:00-12:30

online

Interest Rates and Bond Valuation. Practice and the preparation to the test.

20

Thu

10-Nov

13:00-14:30

online

Interest Rates and Bond Valuation. Practice and the preparation to the test.

21

Thu

17-Nov

11:00-12:30

online

Analysis of the selected company and presentation of results

22

Thu

17-Nov

13:00-14:30

online

Analysis of the selected company and presentation of results

23

Thu

24-Nov

11:00-12:30

online

Analysis of the selected company and presentation of results

24

Thu

24-Nov

13:00-14:30

online

Analysis of the selected company and presentation of results

Homework: Preparing for the Examination II. Self-test

25

Thu

1-Dec

11:00-12:30

online

Examination II

If the examination is not performed at the exam center, but remotely, then during the examination it is mandatory to turn on the MS TEAMS on the phone and point the camera at the computer screen.

26

Thu

1-Dec

11:00-12:30

online

Analysis of the selected company and presentation of results

 

SYLABUS

 

1.    Introduction to Corporate Finance


1.1. Corporate Finance and the Financial Manager

1.2. The Forms of Business Organization

1.3. The Goal of Financial Management

1.4. The Agency Problem and Control of the Corporation

1.5. Financial Markets and the Corporation


       Lecture Notes               Test Questions     PSW     VUEF2012


2. Financial Statements and Cash Flow


2.1. The Balance Sheet

2.2. The Income Statement

2.3. Cash flow


               Lecture Notes             Test Questions  


3. Working with Financial Statements


3.1. Cash Flow and Financial Statements: A Closer Look

3.2. Standardized Financial Statements

3.3. Ratio Analysis

3.4. The Du Pont Identity

3.5. Using Financial Statement information


                  Lecture Notes       Q&P       Test Questions  


4. Long-term Financial Planning and Growth


4.1. What is Financial Planning?

4.2. Financial Planning Models: A First Look

4.3. The Percentage of Sales Approach

4.4. External Financing and Growth


                  Lecture Notes     Q&P        Test Questions  


5. The Time Value of Money


5.1. Future Value and Compounding

5.2. Present Value and Discounting

5.3. More on Present and Future Values


                Lecture Notes      Q&P       Test Questions  


6. Discounted Cash Flow Valuation


6.1. Present and Future Values of Multiple Cash Flows

6.2. Valuing Level Cash Flows: Annuities and Perpetuities

6.3. Comparing Rates: The Effect of Compounding

6.4. Loan Types and Loan Amortization


                   Lecture Notes       Q&P        Test Questions  


7. Interest Rates and Bond Valuation


7.1. Bonds and Bond Valuation

7.2. More on Bond Features

7.3. Bond Ratings

7.4. Some Different Types of Bonds

7.5. Bond Markets

7.6. Inflation and Interest Rates

7.7. Determinants of Bond Rates


                     Lecture Notes    Q&P       Test Questions  




ANALYSIS AND PRESENTATION OF THE SELECTED COMPANY



Student’s registration 

Send requests and presentations: arvydas@paskevicius.com

Slide presentations limited to a duration of 10-15 minutes (desirable in the University Business School form of presentations). Presentations file name must be shortened name of the company. Calculation tables, as additional material illustrating the decision is contained in the Excel form. The presentation you have to send no later than 24 hours before the presentation. The first slide specify: the company name and the author (s) surname (s).

The analyzed companies are very different, therefore their analysis is original in all cases. The student independently chooses a company from among the companies listed in EURONEXT or NYSE. 


The following structure of the Company's analysis is recommended:

1. A general overview of the company, which can describe when the company was established, how its legal status has changed. Advantages and disadvantages of the company's geographical location. The main activity of the company: product-service range, past and future perspectives. Branch overview, competitors. Marketing, markets. Management structure, managers, shareholders, number of employees, dynamics. And other general information.

2. The financial statements of absolute numbers, the overall size of the company balance sheet and profit (loss) statement; the company's balance sheet and profit and loss account for the base year. The tables provided are accompanied by comments explaining the dynamics of the indicators. The student must present not only the trends, but also their opinion about them and possible ways to improve their financial condition.

3. Cash flow statement. The tables provided are accompanied by comments explaining the dynamics of the indicators. The student must present not only the trends, but also their opinion about them and possible ways to improve their financial condition.

4. Ratio analysis.

Short-term solvency and liquidity ratios. Long - term solvency and capital structure indicators. Asset management efficiency and turnover indicators. Profitability indicators. Market value indicators. Du Pont analysis. The presented indicators are accompanied by comments explaining the dynamics of the indicators. The student must present not only the trends, but also their opinion about them and possible ways to improve their financial condition.

5. A summary conclusion of the company's analysis is presented. Recommendations to buy stocks, refrain from trading or sell.

At the end, the sources of used literature and information are presented.


Assessment of company analysis and presentation:

1. Presentations submission timeliness, slide quality, oratorical art, audience involvement in the company analysis 0-3.

2. Size and uniqueness of the analyzed company 0-3

3. The width of the analysis performed, i. e. whether enough work has been done 0-4

4. Depth of analysis, i. e. whether complex analytical methods were used 0-4

5. It was collected an additional, interesting and valuable material on the Internet. 0-2

6. A summary conclusion. Recommendations to buy stocks or sell. 0-2

7. Working as opponent of the peer presentations or active participation in the cases analysis 0-1.  Good questions or comments prized pluses, 3-4 pluses equal to 1 point.



LITERATURE



1. Fundamentalsof Corporate Finance, Ross, S. A. 2019.

2.Principles of Corporate Finance, Brealey, Myers, 2010.

3. Financial Management, Ray M. Brooks. 2010.

4. Capital Markets, Fabozzi Modigliani. 2010 .

 

EVALUATION

 

           Assessment requirements:

For the final assessment, students must work actively during the semester; perform homework assignments; provide an analysis of the selected company and present its results; successfully pass the test, parts I and II of the exam.

           Final assessment criteria:

Homework assignments. 10 percent doing homework assignments. Assignments in Word format must be submitted to the teacher before the beginning of the classes arvydas@paskevicius.com The assessment of the completed assignment is multiplied by 0.1 and added to the final assessment. The assessment of late tasks is reduced by 50%.


Work in auditorium (seminars and lectures). 10 percent assessment consists of the student's active participation in lectures and seminars, the solution of practical tasks. The invited student presents the completed homework assignments, comments on them and discusses them. The evaluation of the solution of the practical tasks is multiplied by 0.1 and summed up to the final evaluation.


Analysis of the selected company and presentation of results. The analysis of the selected company, interpretation of the results, their presentation are evaluated. The analysis score is multiplied by 0.2 and added up to the final assessment. The assessment of late tasks is reduced by 50%.


Test. Test (closed and open questions), problem solving. Students must complete at least 50% of the assignments. If the grade is 5 or higher, it is multiplied by 0.10 and added to the overall final grade. Failure to pass the test will result in a negative final evaluation. If the test is not performed at the exam center, but remotely, then during the test it is mandatory to turn on the MS TEAMS on the phone and point the camera at the computer screen.


Examination I.  Examination I (closed and open questions), problem solving. Students must complete at least 50% of the assignments. If the grade is 5 or higher, it is multiplied by 0.25 and added to the overall final grade. Failure to pass the examination will result in a negative final evaluation. If the examination is not performed at the exam center, but remotely, then during the examination it is mandatory to turn on the MS TEAMS on the phone and point the camera at the computer screen.


Examination II.  Examination II (closed and open questions), problem solving. Students must complete at least 50% of the assignments. If the grade is 5 or higher, it is multiplied by 0.25 and added to the overall final grade. Failure to pass the examination will result in a negative final evaluation. If the examination is not performed at the exam center, but remotely, then during the examination it is mandatory to turn on the MS TEAMS on the phone and point the camera at the computer screen


              Composition of the final accumulative grade:


The final accumulative grade shall be composed of: 

Homework assignments – 10 %

Work in auditorium (seminars and lectures) – 10%

Analysis of the selected company and presentation of results  – 20%

Test – 10%

Examination I – 25%

Examination II – 25%

TEST RESULTS

  





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