CORPFIN 2500 - Business Finance II

North Terrace Campus - Semester 1 - 2014

This course examines firm investment and distribution decisions in the context of a capital market structure and efficiency. Valuation methods are developed for valuing projects and securities. Basic portfolio theory is discussed to develop simple asset pricing models and used for determining the cost of capital for use in investment evaluation. The implications of alternative financing options (debt, equity (retained and new) and leasing) are considered, and elementary capital structure theorems are presented, in relation to which the dividend decisions are analysed. The question of market efficiency is considered, and the implications of this for trading strategies discussed.

  • General Course Information
    Course Details
    Course Code CORPFIN 2500
    Course Business Finance II
    Coordinating Unit Adelaide Business School
    Term Semester 1
    Level Undergraduate
    Location/s North Terrace Campus
    Units 3
    Contact Up to 3 hours per week
    Assumed Knowledge (ECON 1008 or STATS 1000) & ECON 1004 & ACCTING 1002 or ACCTING 1005 or equivalent
    Assessment Exam/assignments/tests/tutorial work as prescribed at first lecture
    Course Staff

    Course Coordinator: Dr Alex Chen

    Course Timetable

    The full timetable of all activities for this course can be accessed from Course Planner.

  • Learning Outcomes
    Course Learning Outcomes
    The aim of this course is that on completion students will have:
    1. Understood the core concepts of financial management, including using valuation and financial modelling techniques to make informed financial decisions, and also...
    2. Become aware of the limitations when using these techniques in a practical context.
    3. Recognized the implications of ethical behaviour in the context of financial management and financial planning.
    4. Progressed in their development of good interpersonal and communication skills.
    University Graduate Attributes

    This course will provide students with an opportunity to develop the Graduate Attribute(s) specified below:

    University Graduate Attribute Course Learning Outcome(s)
    Knowledge and understanding of the content and techniques of a chosen discipline at advanced levels that are internationally recognised. 1, 2
    The ability to locate, analyse, evaluate and synthesise information from a wide variety of sources in a planned and timely manner. 1
    An ability to apply effective, creative and innovative solutions, both independently and cooperatively, to current and future problems. 1
    Skills of a high order in interpersonal understanding, teamwork and communication. 4
    A proficiency in the appropriate use of contemporary technologies. 1
    A commitment to continuous learning and the capacity to maintain intellectual curiosity throughout life. 1,2,4
    A commitment to the highest standards of professional endeavour and the ability to take a leadership role in the community. 3, 4
    An awareness of ethical, social and cultural issues within a global context and their importance in the exercise of professional skills and responsibilities. 3
  • Learning Resources
    Required Resources

    Text Book: 
    Pierson, G., Brown, R., Easton, S., Howard, P., Pinder, S., Business Finance, Eleventh Edition, McGraw Hill, 2011.


    Calculator:
    If you would like to use a graphic calculator in the exam, no text should be stored in its memory. A financial calculator is highly recommended.

    Recommended Resources
    Because this subject gives you the theory and tools to deal with practical financial issues, you will also benefit and find it interesting if you regularly look at the Australian Financial Review and/or the finance pages of the Advertiser or the Australian. Some tutorial questions will refer directly to these issues. This will fill you in with the topics and current issues in the fields of corporate finance and financial management.
    Online Learning
    This course is supported by on-line learning including:

    • Access to the resources provided by McGraw Hill in support of the textbook
    • Access to course materials
    • AV output of lectures shortly after the lecture is held, for revision or catch up purposes
    • Other links and references as appropriate
    • An active discussion board framework
  • Learning & Teaching Activities
    Learning & Teaching Modes
    The approach to learning and teaching for is to use weekly lectures supported by problem-solving tutorials developing and extending material covered in lectures.
    Workload

    The information below is provided as a guide to assist students in engaging appropriately with the course requirements.

    Students in this course are expected to attend all lectures throughout the semester plus one tutorial class (beginning from week 2) each week. This course has been designed such that you are expected to commit approximately 9 hours per week of private study outside of your regular classes.
    Learning Activities Summary

    The course is presented in 11 topics – broadly aligned with weeks of the semester. The topics covered include:

    Date       Topic                                                          Basic Reading (Pierson)

    4 Mar     (1) The Goals and Functions of Finance               Chapter 1

    11 Mar   (2) Time Value of Money                                    Chapter 3

    18 Mar   (3) Bond and Stock Valuation                             Chapter 4

    25 Mar   (4) Basic Project Evaluation                                Chapter 5

    1 Apr     CLASS TEST 1 

    8 Apr    (5) Other Issues in Project Evaluation                   Chapter 6

    MID-SEMESTER BREAK

    29 Apr  (6) Portfolio Theory (Risk and Return)                   Chapter 7

    6 May   (7) Sources of Finance                                         Chapter 9&10

    13 May (8) Dividend Policy                                               Chapter 11

    20 May  CLASS TEST 2

    27 May (9) Capital Structure Decisions                               Chapter 12 & 13

    3 Jun    (10) Cost of Capital                                               Chapter 14

    10 Jun  (11) Market Efficiency                                            Chapter 16

  • Assessment

    The University's policy on Assessment for Coursework Programs is based on the following four principles:

    1. Assessment must encourage and reinforce learning.
    2. Assessment must enable robust and fair judgements about student performance.
    3. Assessment practices must be fair and equitable to students and give them the opportunity to demonstrate what they have learned.
    4. Assessment must maintain academic standards.

    Assessment Summary


    (1) Three-hour final examination (65%)

     
    (2) Class tests (30%)

    Class test 1 (1st April, at Scott Theatre)
    Class test 2 (20th May, at Scott Theatre)

     
    (3) General attendance and participation in tutorials (5%)

    Students are expected to attend tutorials and show evidence of preparation, through their participation in tutorials.
     

    Assessment Detail

    No information currently available.

    Submission

    No information currently available.

    Course Grading

    Grades for your performance in this course will be awarded in accordance with the following scheme:

    M10 (Coursework Mark Scheme)
    Grade Mark Description
    FNS   Fail No Submission
    F 1-49 Fail
    P 50-64 Pass
    C 65-74 Credit
    D 75-84 Distinction
    HD 85-100 High Distinction
    CN   Continuing
    NFE   No Formal Examination
    RP   Result Pending

    Further details of the grades/results can be obtained from Examinations.

    Grade Descriptors are available which provide a general guide to the standard of work that is expected at each grade level. More information at Assessment for Coursework Programs.

    Final results for this course will be made available through Access Adelaide.

  • Student Feedback

    The University places a high priority on approaches to learning and teaching that enhance the student experience. Feedback is sought from students in a variety of ways including on-going engagement with staff, the use of online discussion boards and the use of Student Experience of Learning and Teaching (SELT) surveys as well as GOS surveys and Program reviews.

    SELTs are an important source of information to inform individual teaching practice, decisions about teaching duties, and course and program curriculum design. They enable the University to assess how effectively its learning environments and teaching practices facilitate student engagement and learning outcomes. Under the current SELT Policy (http://www.adelaide.edu.au/policies/101/) course SELTs are mandated and must be conducted at the conclusion of each term/semester/trimester for every course offering. Feedback on issues raised through course SELT surveys is made available to enrolled students through various resources (e.g. MyUni). In addition aggregated course SELT data is available.

  • Student Support
  • Policies & Guidelines
  • Fraud Awareness

    Students are reminded that in order to maintain the academic integrity of all programs and courses, the university has a zero-tolerance approach to students offering money or significant value goods or services to any staff member who is involved in their teaching or assessment. Students offering lecturers or tutors or professional staff anything more than a small token of appreciation is totally unacceptable, in any circumstances. Staff members are obliged to report all such incidents to their supervisor/manager, who will refer them for action under the university's student’s disciplinary procedures.

The University of Adelaide is committed to regular reviews of the courses and programs it offers to students. The University of Adelaide therefore reserves the right to discontinue or vary programs and courses without notice. Please read the important information contained in the disclaimer.