CORPFIN 2502 - Business Valuation II

North Terrace Campus - Semester 1 - 2014

This course will provide the framework to price and value both securitised and non-securitised entities (whether that be specific assets or whole companies). This involves the utilisation of both accounting and financial analysis of the entity to determine value. The course will approach the subject from an applied viewpoint to enable participants to practise valuation methods. The course will also incorporate basic capital raising issues, from both the fixed income and equity perspectives.

  • General Course Information
    Course Details
    Course Code CORPFIN 2502
    Course Business Valuation II
    Coordinating Unit Business School
    Term Semester 1
    Level Undergraduate
    Location/s North Terrace Campus
    Units 3
    Contact Up to 3 hours per week
    Corequisites CORPFIN 2500
    Course Description This course will provide the framework to price and value both securitised and non-securitised entities (whether that be specific assets or whole companies). This involves the utilisation of both accounting and financial analysis of the entity to determine value. The course will approach the subject from an applied viewpoint to enable participants to practise valuation methods. The course will also incorporate basic capital raising issues, from both the fixed income and equity perspectives.
    Course Staff

    Course Coordinator: Dr Paskalis Glabadanidis

    Name: Paskalis Glabadanidis
    Location: Room 12.31, 10 Pulteney Street
    Telephone: 8313 7283
    Course Website:
    Course Timetable

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

    Lecture/Weel 1 Topics (Mar 4)

    Syllabus/Introduction to Valuation 
    DCF, Relative Valuation, Contingent Claim Valuation

    Lecture/Week 2 Topics (Mar 11)

    Estimating Discount Rates

    Measuring Cash Flows

    Lecture/Week 3 Topics (Mar 18)

    Forecasting Cash Flows

    Lecture/Week 4 Topics (Mar 25)

    Equity Valuation Models

    Lecture/Week 5 Topics (Apr 1)

    Firm Valuation Models

    Lecture/Week 6 Topics (Apr 8)

    Mid-Term Examination (9am-10am) 
    Relative Valuation: First Principles (10am-11am)

    Lecture/Week 7 Topics (Apr 29)

    Relative Valuation: Equity Multiples

    Lecture/Weel 8 Topics (May 6)

    Relative Valuation: Value Multiples
    Introduction to Options

    Lecture/Weel 9 Topics (May 13)

    Options Strategies and Payoffs

    Binomial Option Pricing

    Lecture/Week 10 Topics (May 20)

    Valuing Equity/Debt in the Option Pricing Framework
    Real Option Valuation

    Lecture/Week 11 Topics (May 27)

    Introduction to Fixed Income Securities

    Spot/Forward Interest Rates

    Lecture/Weel 12 Topics (Jun 3)

    Bond Valuation Using No Arbitrage Pricing
    Term Structure Theories

  • Learning Outcomes
    Course Learning Outcomes
    The aim of this course is to present the various state-of-the-art valuation models in use in modern financial practice as well as the development of a solid basis for understanding financial valuation theory. The continuing development of good interpersonal and communication skills is widely recognized as important for finance professionals, and in this context this subject specifically seeks to develop students’ abilities to participate in group discussion, to work in groups and write a good business valuation report.
    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. An understanding of core business valuation concepts and their application
    The ability to locate, analyse, evaluate and synthesise information from a wide variety of sources in a planned and timely manner. The basic knowledge required to go on and complete more advanced finance courses
    An ability to apply effective, creative and innovative solutions, both independently and cooperatively, to current and future problems. Ability to research for appropriate data and apply valuation concepts to the solution of practical valuation problems
    Skills of a high order in interpersonal understanding, teamwork and communication. Ability to work with peers in financial analysis and valuation projects
    A proficiency in the appropriate use of contemporary technologies. Ability to critically analyse media and public reports about what is occurring in financial markets
    A commitment to continuous learning and the capacity to maintain intellectual curiosity throughout life. Ability to adapt key valuation concepts and ideas to new and unfamiliar valuation problems
    A commitment to the highest standards of professional endeavour and the ability to take a leadership role in the community. An understanding and application of the concept of prudence in valuation
    An awareness of ethical, social and cultural issues within a global context and their importance in the exercise of professional skills and responsibilities. Ability to recognize conflicts of interest in valuation contexts
  • Learning Resources
    Required Resources
    Textbook: Damodaran on Valuation, 2nd edition, 2006, John Wiley & Sons
    Study Guide: Study Guide for Damodaran on Valuation, 1st edition, John Wiley & Sons.
    Both items available as a value pack from UniBooks.

    Glabadanidis, Absence of Arbitrage Valuation: A Unified Framework for Pricing Assets and Securities, 2014, 1st ed., Palgrave Macmillan US. Also available from UniBooks.
    Online Learning
    Course Lecture notes as well as additional materials (data spreadsheets, etc.) will be made available on MyUni.
  • Learning & Teaching Activities
    Learning & Teaching Modes
    Student learning in this course consists of following lectures supported by problem-solving tutorials developing material covered in lectures.

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

    The University expects full-time students (i.e. those taking 12 units per semester) to devote a total of 48 hours per week to their studies. This means that you are expected to commit approximately 9 hours for a three-unit course or 13 hours for a four-unit course, of private study outside of your regular classes. Students in this course are expected to attend all lectures throughout the semester plus one tutorial class each week.
    Learning Activities Summary

    No information currently available.

  • 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
    Assessment in this class will consist of a single midterm examination worth 30% of the final grade, an up to twenty page group business valuation project report worth 30% of the final grade, and a comprehensive final examination worth 40% of the final grade. None of the assignments and exams are redeemable. If a student misses the midterm test due a valid and documented reason (eg, medical report) then the final exam will count towards the combined weight of the midterm test and the final exam. In the absence of a documented reason for missing an exam or an assignment a mark of zero will be assigned to the respective exam/assignment.
    Assessment Related Requirements
    While we are not going to keep attendance during tutorials it is highly advisable that you attend as many as you can. The more material you master during class/tutorial time, the less time you will have to spend studying on your own. Therefore, it is in your best interest to attend all lectures and tutorials for the class.

    Consultation times are on Tuesday between 11am and 12pm in the office of the lecturer in charge at the Nexus 10 building.
    Assessment Detail
    The assessment components are as follows:

    Class Test (Week 6) 30%

    A 1 hour class test will be held in Week 6 on Tuesday, April 8, 2014 during the first half of the lecture block – from 9am until 10am. It will cover Discounted Cash Flow (DCF) Valuation up until Firm Valuation models. The test will be closed book but you can bring in a two-sided A4 cheat sheet with your own notes, formulas, etc., hand-written or typed.

    Date and time: 9am-10am, Tuesday, April 9, 2014

    Group Valuation Project (Due in Week 10) 30%

    Each group should have at most six students whose names should appear on the cover page of the report. The report itself should be no more than 20 pages long excluding any appendices, tables and graphs you may want to attach. A penalty of 1.5% (out of 30%) will be applied for every day late the project is turned in.

    Due Date: 4.30 pm on Tuesday, May 20, 2014

    Final Exam 40%

    There will be a 3 hour exam covering topics subsequent to the midterm test. You will not be allowed to bring in a cheat sheet to the final exam. A formula sheet will be supplied by the lecturer in charge.
    Please submit your completed group project in the appropriate Business Valuation II drop-box on the ground level of the Nexus 10 building by the specified deadline for full credit.

    Presentation of Assignments
    · Students must retain a copy of all assignments submitted.
    · Please attach an ‘Assignment Cover Sheet’, which is signed and dated by you before submission.
    · The group business valuation report must be attached to a ‘Group Assignment Cover Sheet’, which must be signed and dated by all group members before submission. All team members are expected to contribute approximately equally to a group assignment.

    Lecturers can refuse to accept assignments, which do not have a signed acknowledgement of the University’s policy on plagiarism.

    Assignment Guidelines including Referencing Details

    Further assistance with referencing is available from the Faculty’s Learning Support Advisors. The contact details are provided on page 6 of the Communication Skills Guide.

    Late Assignment Submission

    Students are expected to submit their work by the due date to maintain a fair and equitable system. Extensions will generally only be given for medical or other serious reasons. All requests for extensions must be emailed to the lecturer in charge of the course before the due date. Each request will be assessed on its merits. A late assignment (without prior arrangement) will be penalised by a 1.5% mark reduction for each day that it is late.

    Return of Assignments

    Lecturer’s aim to mark and return assignments to students within three (3) weeks of the due date with written feedback. Students are responsible for collecting their marked assignments from either their tutorials or lectures. If assignments aren’t collected after two (2) weeks, the assignments will be available at the Student Hub for two (2) weeks. The remaining assignments will only be posted out to the students, if the correct mailing addresses are on the assignments.
    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 ( 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.