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0-BF-1 MBA Course Outline

This document provides an overview of a Business Finance 1 course for an Executive MBA program. The course aims to introduce students to basic financial concepts and tools used for financial decision making. By the end of the course, students will be able to evaluate financial models, understand financial principles, evaluate projects, and manage funds, cash flow and working capital. The course will include midterm and final exams, assignments, quizzes and case reports. Core textbooks will cover essential managerial finance concepts. Course requirements include preparing in advance, keeping up with materials, and completing assignments on time. The 14 sessions will discuss topics like financial statements, markets, valuation, risks, capital budgeting, cost of capital, capital structure, and short-

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42 views

0-BF-1 MBA Course Outline

This document provides an overview of a Business Finance 1 course for an Executive MBA program. The course aims to introduce students to basic financial concepts and tools used for financial decision making. By the end of the course, students will be able to evaluate financial models, understand financial principles, evaluate projects, and manage funds, cash flow and working capital. The course will include midterm and final exams, assignments, quizzes and case reports. Core textbooks will cover essential managerial finance concepts. Course requirements include preparing in advance, keeping up with materials, and completing assignments on time. The 14 sessions will discuss topics like financial statements, markets, valuation, risks, capital budgeting, cost of capital, capital structure, and short-

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SZA
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Institute of Business Administration, Karachi

Business Finance 1 - Executive MBA


Muslim Reza Mooman [email protected]
COURSE DESCRIPTION & COURSE OBJECTIVES
-Course is designed for MBA students who have not yet been exposed to the issues of
finance.
-The course aims at introducing the students to the important, interesting and challenging field
of Finance. The course would primarily be around basic financial concepts and tools used to
frame the financial decision making process. As a consequence of this course, I expect to
increase the students’ confidence to work with financial information.
LEARNING OUTCOMES
By the end of this course the students will be able to:
-How financial modeling is done;
-Evaluate and understand how financial tools are used;
-Principals behind the financial models;
-Project evaluation;
-Fund management / cash flow management / working capital management
GRADING BREAKUP AND POLICY
Assignments, Class Participation 15
Quizes 15
Mid Terms 30
Final Exam 40
Total 100
EXAMINATION DETAIL
There will be one Mid-Term & one Final Exam along with assignments/quizzes/case & term
reports.
CORE TEXT BOOKS
Study Text: Essentials of Managerial Finance, 14 th Edition, By – Scott Besley& Eugene F.
Brigham
COURSE REQUIREMENTS
• Many of the concepts you encounter may be new to you. It is anticipated that you
prepare the topics in advance to be ready for the discussion and quizzes.
• Since subsequent topics build on previously learned material, it is imperative that
students keep up with the material. A student who misses a class is responsible for
obtaining any handouts and information on course content, assignments, due dates, etc
• Financial calculator is recommended (not mandatory) for the course. If you are
planning to buy the financial calculator, Texas Instruments, BA II Plus is
recommended.
• The quizzes may be in advance or from the previous topic. There will be a perfect zero
if you miss the quiz.
• You are expected to complete the assignments on the due date. No excuses will be
entertained in late submission unless there is some extreme case.

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SESSION DISCUSSION TOPICS CHPT
1 Chapter 1: Introduction to Managerial Finance; what is finance, general areas 1
of finance, importance of finance in non-finance areas, alternative forms of
business organizations, goals that business pursue? What are financial
products? Importance of various Markets, etc.
2 Chapter 2: Essential concepts in Managerial Finance; Analysis of financial 2
statements. How do investors use financial statements: working capital,
operating cash flows, free cash flows, economic value added, liquidity, asset
management, profitability, market value, trend analysis, the DuPont analysis,
Ratio analysis.
3 Chapter 3: Essential concepts; financial markets and investment banking
process. What are financial markets, and their types, investment banking
process, international financial markets, financial intermediaries and their 3/4
roles.
Chapter 4: The time value of money (discounted cash flows, annuities and
perpetuities, loan amortization).
4 Chapter 5: Valuation of Financial Assets; the cost of money (interest rates)-
Realized returns, the factors that affect the cost of money, interest rate levels, 5
the determinants of market interest rates, interest rates level and stock prices.
5 Chapter 6: Valuation of Financial Assets – bonds (debts); their
characteristics, types of debts, bond contract features, bond ratings, foreign 6
debt instruments, valuation of bonds, finding bond yields
6 Chapter 7: Valuation of Financial Assets; stocks (equity)- Preferred stocks,
common stocks, equity instruments in international markets, stock valuations 7/8
(DDM etc)
Chapter 8: Risks and rate of return – defining and measuring risks, expected
rate of return, portfolio risks, the relationship between risks and rate of return
(CAPM).
7 Mid Term Examination -
8 Chapter 9: Capital Budgeting Projects Evaluation Techniques: Payback, NPV
and IRR, capital budget methods used in practice, project cash flows and 9
risks.
9 Chapter 11: Cost of Capital, Making informed borrowing and investment 11
decisions,
10 Chapter 12: Capital Structure, Optional capital structure, Firms capital
structure affect its risk? Leverage, Degree of operating leverage, Degree of 12
Financial leverage, liquidity and capital structure
11 Chapter 15: Managing short term assets; cash budgets, cash management
techniques, marketable securities Types of inventory, optimal inventory 15
levels, inventory control systems. Credit management, receivables
monitoring, and analyzing proposed changes in credit policy.
12 Chapter 16: Managing short-term liabilities; sources of short-term financing,
accruals, accounts payable, short-term bank loans, commercial paper, 16
computing the cost of short-term credit, use of security in short-term
financing.
13 Presentations and Recapitulation -
14 Final Examination -

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