Kurso programos
FINANCE MANGEMENT (BS at Vilnius University 3'rd year International Business Group)
:
VILNIUS UNIVERSITY
BUSINESS SCHOOL
FINANCE MANAGEMEN
International Business Group
Prepared by prof. dr. Arvydas Paškevičius
The course Finance Management 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 Finance Management provides students with the following abilities: The ability to establish the value of stocks by means of a discounted cash flow method. The ability to calculate the net present value by means of a discounted cash flow method. The ability to calculate the criteria of the payback time, the discounted payback time, the average book return, the internal profit rate, and the profitability index. The ability to establish the income and expenditure of a capital investment project and to present them in the cash flow financial forms. The ability to assess the cost-reducing investments and to calculate the minimum tender price. The ability to analyse capital investment projects by means of the “what-if“ analysis method and to calculate the accounting and financial breakeven.
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.
VU Virtual Learning Enviroment
ORGANIZATION OF STUDIES
Dear students
We will use 2 programs when organizing studies
First, this page that contains all the information (lecture notes, syllabi, exercise tasks, case study tasks, and exam questions).
Second, VU Virtual Learning Enviroment, e-learning, where you will find the exam task and link to this page.
SCHEDULE
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Nr. |
S.D. |
Data |
Time |
Room |
Group 1 |
Group 2 |
Notes |
|
1 |
Tue |
07 February 2023 |
11:00-12:30 |
101 |
A lecture. Stock Valuation. |
A lecture. Stock Valuation. |
|
|
2 |
Tue |
07 February 2023 |
13:00-14:30 |
101 |
A lecture. Stock Valuation. |
A lecture. Stock Valuation. |
Homework: Chapter 8 Questions and Problems # 1-15. Chapter 8 Test Questions |
|
3 |
Tue |
14 February 2023 |
11:00-12:30 |
101 |
Exercise/seminar. Stock Valuation. Practice and the preparation to the test. |
|
|
|
4 |
Tue |
14 February 2023 |
13:00-14:30 |
101 |
A lecture. Net Present Value and other investment Criteria |
A lecture. Net Present Value and other investment Criteria |
Homework: Preparation for test. Self-test |
|
5 |
Tue |
14 February 2023 |
14:40-16:10 |
101 |
|
Exercise/seminar. Stock Valuation. Practice and the preparation to the test. |
|
|
6 |
Tue |
21 February 2023 |
11:00-12:30 |
EC 108-1 108-2 |
Test #1 |
Test #1 |
|
|
7 |
Tue |
21 February 2023 |
13:00-14:30 |
101 |
A lecture. Net Present Value and other investment Criteria |
A lecture. Net Present Value and other investment Criteria |
.Homework: Chapter 9 Questions and Problems # 1-11, |
|
8 |
Tue |
28 February 2023 |
11:00-12:30 |
101 |
Exercise/seminar. Net Present Value and other investment Criteria Preparation to the Test |
|
|
|
9 |
Tue |
28 February 2023 |
13:00-14:30 |
101 |
A lecture. Net Present Value and other investment Criteria |
A lecture. Net Present Value and other investment Criteria |
Homework: Chapter 9 Questions and Problems # 12-16, Chapter 9 Test Questions
|
|
10 |
Tue |
28 February 2023 |
14:40-16:10 |
101 |
|
Exercise/seminar. Net Present Value and other investment Criteria Preparation to the Test |
|
|
11 |
Tue |
07 March 2023 |
11:00-12:30 |
101 |
Exercise/seminar. Net Present Value and other investment Criteria Preparation to the Test |
|
|
|
12 |
Tue |
07 March 2023 |
13:00-14:30 |
101 |
A lecture. Making Capital Investment Decisions |
A lecture. Making Capital Investment Decisions |
Homework: Preparation for examination. Self-test |
|
13 |
Tue |
07 March 2023 |
14:40-16:10 |
101 |
|
Exercise/seminar. Net Present Value and other investment Criteria Preparation to the Test |
|
|
14 |
Tue |
14 March 2023 |
11:00-12:30 |
EC 108-1 108-2 |
Examination I |
Examination I |
|
|
15 |
Tue |
14 March 2023 |
13:00-14:30 |
101 |
A lecture. Making Capital Investment Decisions |
A lecture. Making Capital Investment Decisions |
Homework: Chapter 10 Questions and Problems # 1-18. Chapter 10 Test Questions |
|
16 |
Tue |
21 March 2023 |
11:00-12:30 |
101 |
Exercise/seminar. Making Capital Investment Decisions practice. Preparation to the Examination |
|
|
|
17 |
Thu |
21 March 2023 |
13:00-14:30 |
101 |
A lecture. Project analysis and evaluation |
A lecture. Project analysis and evaluation |
|
|
18 |
Thu |
21 March 2023 |
14:40-16:10 |
101 |
|
Exercise/seminar. Making Capital Investment Decisions practice. Preparation to the Examination |
Homework: Preparation for examination. Self-test |
|
19 |
Thu |
28 March 2023 |
11:00-12:30 |
EC 108-1 108-2 |
Examination II |
Examination II |
|
|
20 |
Thu |
28 March 2023 |
13:00-14:30 |
101 |
A lecture. Project analysis and evaluation |
A lecture. Project analysis and evaluation |
Homework: Chapter 11 Questions and Problems #1-15. Chapter 11 Test Questions |
|
21 |
Thu |
04 April 2023 |
|
|
Easter holidays |
|
|
|
22 |
Thu |
04 April 2023 |
|
|
Easter holidays |
|
|
|
23 |
Thu |
11 April 2023 |
11:00-12:30 |
101 |
Exercise/seminar. Project analysis and evaluation practice. Preparation to the Examination Case study presentations |
|
|
|
24 |
Thu |
11 April 2023 |
13:00-14:30 |
101 |
Case study presentations: Merck & Company: Evaluating a Drug Licensing Opportunity Yuliya Mironava Anhelina Valkavets Aliaksandra Lepesevich |
Case study presentations: Merck & Company: Evaluating a Drug Licensing Opportunity Yuliya Mironava Anhelina Valkavets Aliaksandra Lepesevich |
|
|
25 |
Thu |
11 April 2023 |
14:40-16:10 |
101 |
|
Exercise/seminar. Project analysis and evaluation practice. Preparation to the Examination Case study presentations |
Homework: Preparation for examination. Self-test |
|
26 |
Thu |
18 April 2023 |
11:00-12:30 |
101 |
Case study presentations 1.Lockheed company 2. The Investment Detective |
|
|
|
27 |
Thu |
18 April 2023 |
13:00-14:30 |
101 |
Case study presentations |
Case study presentations |
|
|
28 |
Thu |
18 April 2023 |
14:40-16:10 |
101 |
|
Case study presentations: 1. Euroland Foods 2.TREE VALUES |
|
|
29 |
Thu |
25 April 2023 |
11:00-12:30 |
101 |
Case study presentations |
|
|
|
30 |
Thu |
25 April 2023 |
13:00-14:30 |
101 |
Case study presentations |
Case study presentations |
|
|
31 |
Thu |
25 April 2023 |
14:40-16:10 |
101 |
|
Case study presentations |
|
|
32 |
Thu |
02 May 2023 |
11:00-12:30 |
EC 108-1 108-2 |
Examination III |
|
|
|
33 |
Thu |
02 May 2023 |
13:00-14:30 |
101 |
Case study presentations |
Case study presentations |
|
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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 PSW VUEF2012
2. Financial Statements and Cash Flow
2.1. The Balance Sheet
2.2. The Income Statement
2.3. Cash flow
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
9. Net Present Value and Other Investment Criteria
9.1. Net present value
9.2. The Payback Rule
9.3. The Discounted Payback
9.4. The Average Accounting Return
9.5. The Internal Rate Of Return
9.6. The Profitability Index
Lecture Notes Q&P Test Questions
10. Making Capital Investment Decisions
10.1. Project Cash Flows: A First Look
10.2. Incremental Cash Flows
10.3. Pro Forma Financial Statements and Project Cash Flows
10.4. More on Project Cash Flow
10.5. Alternative Definitions of Operating Cash Flow
10.6. Some Special Cases of Cash Flow Analysis
Lecture Notes Q&P Test Questions
11. Project analysis and evaluation
11.1. Evaluating NPV Estimates
11.2. Scenario and Other What-If Analyses
11.3. Break-Even Analysis
11.4. Operating Cash Flow, Sales Volume, and Break-Even
11.5. Operating Leverage
11.6. Capital Rationing
Lecture Notes Q&P Test Questions
CASE ANALYSIS AND PRESENTATION
Send requests and presentations: arvydas@paskevicius.com
Slide presentations limited to a duration of 10-15 minutes. (desirable in the University form of presentations). Presentations file name must be shortened name of the case. Calculation tables, as additional material illustrating the decision is contained in the Excel form. The presentation you have to send no later than 24 hours before the presentation. The first slide specify: the theme and the author (s) surname (s).
Case studies do not have a straight answer. Different people shall bring a unified solution, so the analysis of the case must present YOUR decision and justify it argumentative. The analysis of the test should be kept in mind that the latest information about the problem and the company can be find on the internet.
Assessment of case analysis and presentation:
1. Presentations submission timeliness, slide quality, oratorical art, audience involvement in the case study 0-3.
2. The complexity of the analysed problem 0-3
3. Case studies breadth, i.e. quite a lot of work done 0-4
4. Depth of the case analysis, i.e. use sophisticated analytical techniques 0-4
5. It was collected an additional, interesting and valuable material on the Internet. For example how the company is now doing, what the consequences, modern innovations. 0-2
6. A summary of the findings, what is memorable, the most valuable of the case presented, where you can apply the acquired knowledge 0-2
7. Working as opponent of the peer presentations or active participation in the cases analysis 0-1. Good questions or comments prized pluses, 3-4 pluses equal to 1 point.
1. Lockheed Tri Star and Capital Budgeting. Pages 367-369.
2. Merck & Company: Evaluating a Drug Licensing Opportunity. Pages 371-376.
3. Tree Values. Pages 377-379.
4. The Super Project. Pages 381-394.
5. NetFlix.com, Inc. Pages 395-403.
6. A-Rod: Signing the Best Player in Baseball. Pages 405-418.
7. Ocean Carriers. Pages 419-423.
8. Whirpool Europe. Pages 425-430.
9. Health Development Coporation. Pages 431-434.
10. The
Investment Detective (Investment criteria and discounted
cash flow) Page 257
11. Worldwide
Paper Company (Analysis of an expansion
investment) Page 259
12. Target
Corporation (Multifaceted capital investment decisions)
Page 263
13. Aurora
Textile Company (Analysis of an automation investment)
Page 283
14. Compass
Records (Analysis of working capital
investment) Page 295
15. Victoria
Chemicals plc (A): The Merseyside Project (Relevant cash
flows) Page 309
16. Victoria
Chemicals plc (B): Merseyside and Rotterdam Projects (Mutually
exclusive investment opportunities) Page 317
17. Euroland
Foods S.A. (Strategic resource allocation) Page 325
18. Star
River Electronics Ltd.(Capital project analysis and forecasting)
Page 337
LITERATURE
1. Fundamentalsof Corporate Finance, Ross, S. A. 2019.
2.Principles of Corporate Finance, Brealey, Myers, 2010.
3. Financial Management, Ray M. Brooks. 2010.
4. Capital Markets, Fabozzi Modigliani. 2010 .
EVALUATION
Assessment requirements:
For the final assessment, students must work actively during the semester; perform homework assignments; provide an analysis of the case study and present its results; successfully pass the test, parts I, II and III of the exam.
Final assessment criteria:
Homework assignments. 10 percent doing homework assignments. Assignments in Word format must be submitted to the teacher before the beginning of the classes arvydas@paskevicius.com The assessment of the completed assignment is multiplied by 0.1 and added to the final assessment. The assessment of late tasks is reduced by 50%.
Work in auditorium (seminars and lectures). 10 percent assessment consists of the student's active participation in lectures and seminars, the solution of practical tasks. The invited student presents the completed homework assignments, comments on them and discusses them. The evaluation of the solution of the practical tasks is multiplied by 0.1 and summed up to the final evaluation.
Analysis of the case study and presentation of results. The analysis of the case study, interpretation of the results, their presentation are evaluated. The analysis score is multiplied by 0.2 and added up to the final assessment. The assessment of late tasks is reduced by 50%.
Test. Test (closed and open questions), problem solving. Students must complete at least 50% of the assignments. If the grade is 5 or higher, it is multiplied by 0.15 and added to the overall final grade. Failure to pass the test will result in a negative final evaluation. If the test is not performed at the exam center, but remotely, then during the test it is mandatory to turn on the MS TEAMS on the phone and point the camera at the computer screen.
Examination I. Examination I (closed and open questions), problem solving. Students must complete at least 50% of the assignments. If the grade is 5 or higher, it is multiplied by 0.15 and added to the overall final grade. Failure to pass the examination will result in a negative final evaluation. If the examination is not performed at the exam center, but remotely, then during the examination it is mandatory to turn on the MS TEAMS on the phone and point the camera at the computer screen.
Examination II. Examination II (closed and open questions), problem solving. Students must complete at least 50% of the assignments. If the grade is 5 or higher, it is multiplied by 0.15 and added to the overall final grade. Failure to pass the examination will result in a negative final evaluation. If the examination is not performed at the exam center, but remotely, then during the examination it is mandatory to turn on the MS TEAMS on the phone and point the camera at the computer screen.
Examination III. Examination III (closed and open questions), problem solving. Students must complete at least 50% of the assignments. If the grade is 5 or higher, it is multiplied by 0.15 and added to the overall final grade. Failure to pass the examination will result in a negative final evaluation. If the examination is not performed at the exam center, but remotely, then during the examination it is mandatory to turn on the MS TEAMS on the phone and point the camera at the computer screen
Composition of the final accumulative grade:
The final accumulative grade shall be composed of:
Homework assignments – 10 %
Work in auditorium (seminars and lectures) – 10%
Analysis of the case study and presentation of results – 20%
Test – 15%
Examination I – 15%
Examination II – 15%
Examination III – 15%
TEST RESULTS
Grįžti