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FINANCIAL MANGEMENT (BS at Vilnius University 3'rd year International Business Group

 

VILNIUS UNIVERSITY

INTERNATIONAL BUSINESS SCHOOL

FUNDAMENTALS OF CORPORATE FINANCE

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

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

 

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 

 

8. Stock Valuation

8.1. Common Stock Valuation

8.2. Some Features of Common and Preferred Stock

8.3. Stock Markets

                   Lecture Notes       Q&P        Test Questions 

 

LITERATURE

 

1. Fundamentals of Corporate Finance, Ross, S. A. 2010.

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

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

4. Capital Markets, Fabozzi Modigliani. 2010 .

Textbook materials (access can be granted individually)   Ch1   Ch2   Ch3 Ch4   Ch5   Ch6   Ch7   Ch8   Ch9 Ch10

 

 

SCHEDULE

 

 

Nr.

S.D.

Data

Time

Room

Chapter

Notes

1

Thu

8-Sep

9:00-10:30

210

Introduction to the Course. Introduction to Corporate Finance

 

2

Thu

8-Sep

11:00-12:30

210

Introduction to Corporate Finance. The preparation to the test

 

3

Thu

15-Sep

9:00-10:30

210

 

 

4

Thu

15-Sep

11:00-12:30

210

 

 

5

Thu

22-Sep

9:00-10:30

210

Financial Statements and Cash Flow

 

6

Thu

22-Sep

11:00-12:30

210

Financial Statements and Cash Flow. The preparation to the test

 

7

Thu

29-Sep

9:00-10:30

210

Financial Statements and Cash Flow. The preparation to the test

 

8

Thu

29-Sep

11:00-12:30

210

Working With Financial Statements

 

9

Thu

6-Oct

9:00-10:30

EC

Test #1 (Ch1-2)

 

10

Thu

6-Oct

11:00-12:30

210

Working With Financial Statements

 

11

Thu

13-Oct

9:00-10:30

210

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

 

12

Thu

13-Oct

11:00-12:30

210

Working With Financial Statements. Practice and the preparation to the test. Long-term Financial Planning and Growth

 

13

Thu

20-Oct

9:00-10:30

210

Long-term Financial Planning and Growth

 

14

Thu

20-Oct

11:00-12:30

210

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

 

15

Thu

27-Oct

9:00-10:30

EC

Test #2 (Ch3-4)

 

16

Thu

27-Oct

11:00-12:30

210

The Time Value of Money Discounted Cash Flow Valuation

 

17

Thu

3-Nov

9:00-10:30

210

Discounted Cash Flow Valuation practice

 

18

Thu

3-Nov

11:00-12:30

210

The Time Value of Money Discounted Cash Flow Valuation

 

19

Thu

10-Nov

9:00-10:30

210

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

 

20

Thu

10-Nov

11:00-12:30

210

Interest Rates and Bond Valuation

 

21

Thu

17-Nov

9:00-10:30

210

Test #3 (Ch5-6)

 

22

Thu

17-Nov

11:00-12:30

210

Interest Rates and Bond Valuation

 

23

Thu

24-Nov

9:00-10:30

210

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

 

24

Thu

24-Nov

11:00-12:30

210

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

 

25

Fri

1-Dec

11:00-12:31

210

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

 

26

Sat

1-Dec

11:00-12:32

210

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

 

25

Thu

8-Dec

9:00-10:30

EC

Test #4 (Ch7)

 

26

Thu

15-Dec

9:00-10:30

EC

Exam

 

 

 

EVALUATION

Assessment requirements:

Analysis and solutions of tasks and problems at seminars, attendance of lectures and practical classes, interim tests, examination.

Final assessment criteria:

The grade assigned for problem solution at seminars is multiplied by 10%.

Where a student has missed not more than 25% of the total lectures and practical classes (seminars), 1 point or 10% are added to the final grade.

Colloquium tests shall be taken by electronic means at the Examination centre. Students are required to solve not less than 50% of all tasks presented in four tests. Where the grade for the colloquium is above 4, it is multiplied by 20% and shall be added to the final result. It is necessary to pass all 4 tests. Students who during semester have passed all tests and have accumulated positive assessment may be absent exam.

Composition of the final accumulative grade:

The final accumulative grade shall be composed of: 

Problem solutions at seminars and lectures – 10 %

Attendance of lectures and practical classes – 10%

Grade from colloquium 1 – 20%

Grade from colloquium 2 – 20%

Grade from colloquium 3 – 20%

Grade from colloquium 4 – 20%

 

 

TEST RESULTS

  

 



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