ProgrammesModule: Finance and Corporate Finance
Course Title: Finance and Corporate Finance
Course Code: UU-FNE-1002-MW
Programme: Bachelor of Science (BSc) in Finance - MW - BL
The main purpose of this module is to enable students to understand the key finance principles and apply them where necessary, be aware of how financial markets work and successfully operate within them. In this module, the emphasis is on Corporate Finance. This involves corporate finance principles and how valuation, capital budgeting and capital structure of a company work. Students will also look at how financial markets interact and how certain principles can be applied in practice.
This module aims at providing students with key finance principles, showing how managerial finance can affect the value of the firm and allow the students to comprehend how financial theory can be used to address practical problems. Students will also be equipped with knowledge of corporate finance principles, principles of valuation, capital budgeting, risk, capital structure,
dividend policy and long-term debts in Corporate Finance, theory in addressing practical problem solving and the ability to use the above underlying concepts in Corporate Finance.
Module Learning Outcomes
After completing the module students should be able to:
1. Define the importance and role of finance in the organization (students should be able to understand the important role finance plays in an organization’s efforts to maximize shareholders’ wealth).
2. Utilize financial statements as an analysis tool in Corporate Finance. They will examine the types of actions that the firm can take to improve its financial position in the future.
3. Calculate and apply time value of money concepts (students should be able to understand the present value, future value, annuity and the comparison of different interest rates.
4. Measure risk and rates of return (students will acquire the necessary knowledge and understanding to be able to measure the risk and return of an investment.
5. Assess the valuation of Bonds and Stocks (students will have the skills and knowledge to be able to determine the market value of debt and equity, using different models.
6. Explain the cost of capital (students should be able to understand the types of capital that the firms use to finance investments and the cost of each capital component)
7. Estimate the firm’s optimal capital structure (students should be able to understand the concept of optimal capital structure and examined the effects of financial leverage on stock prices, earnings per share, and the cost of capital).
8. Calculate and apply valuation techniques, advanced capital budgeting, return and risk techniques (using CAPM and Arbitrage principles).
9. Examine the use of Options, warrants, convertibles, leasing and derivatives instruments as tools in corporate finance.
10. Identify the importance of dividend policy and its impact on corporate finance decisions.
11. Explain how mergers and acquisitions can be used and their implications to the long term capital of companies.
Prerequisites: UU-BA-IND100, UU-FNT-103