Paper BBSTQSC09/16

Unit Information Form (UIF)

UIF1112

The UIF provides essential information to students, staff teams and others on a particular unit. Please refer to the Universitys Guidance notes on Unit Information Forms before completing the details below

SECTION 1 - Changes made to Section 1 of the UIF will require Faculty level approval. If substantial changes to Units/Courses are required, consult with Sub Dean (Quality Enhancement) for advice Unit Name Unit Code Level Credit Value Location of Delivery Corporate Finance AAF002-6 7 15 Putteridge Bury Corporate Finance relates to the study of the activities of financial managers and the impact of those activities in the financial markets. A financial market is a forum whereby the activities of lending and borrowing and the buying and selling of financial assets take place. Consequently, the decisions of managers at a corporate level will impact on such buying and selling decisions. Throughout this unit, you are required to develop an understanding of the nature of risk, return and shareholder value. In so doing this, you begin to build a picture of the interaction of these fundamental concepts within a corporate environment. You are led through the fundamental decisions that financial managers make, namely that of corporate investment, financing and dividends before going on to explore other attributes of corporate financial activity such as risk management, mergers and acquisitions and the management of corporate bankruptcy. Merger and acquisition activity has played an increasingly prominent role in corporate finance and this is explored by critically appraising some of the largest and most costly investment decisions in corporate history. The aims of this unit are such that you should be able to: Develop an appreciation for the wide and varied ramifications of corporate decision making through the use of case study analysis. Derive the links at both an intellectual and practical level that show how the behaviour of financial managers has an impact on the stock market. Appreciate the extent to which shareholders are rational in understanding and responding to the signals that the corporate world sends.
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Summary/Overview

Aims

Through the analysis of case studies, carry out and implement effective, shareholder maximising strategies that reduce investor risk exposure.

Core Learning Outcomes

Learning Outcomes On completion of this unit you should be able to:

Assessment Criteria To achieve the learning outcome you must demonstrate the ability to:

Generate realistic solutions that can be applied to contemporary problems in the area of corporate finance. Provide a critique of the different models that are applicable in this discipline. Examine the signals and anticipate the impact of corporate behaviour on the financial markets.

Evaluate the different approaches to the management of risk in the corporate world.

Critically debate the axiom of shareholder wealth maximisation versus alternative shareholder priorities of ethics and environmentalism.

Debate the relationship between firm value and Capital Structure using illustrations to support your arguments and solutions. Solve the problem of bankruptcy costs and relate your solution to firms in the current economic climate. Assess the impact of company announcements on stock price and then reflect on how wealth could be further enhanced by manipulating the timing of such announcements. Generate different risk hedging strategies using published Option prices and provide detailed recommendations using Option Put Call Profit illustrations that would benefit clients. Synthesises different aspects of a companys experiences in relation to shareholder wealth under the limitations of competing management and shareholder priorities.

SECTION 2 - Any changes made to Section 2 of the UIF will normally require Faculty level approval Period of delivery Pre-requisites/Restrictions Activity Notional Learning Hours Lectures 24 Seminars/tutorials Lab/Field work 24 Workshops Rehearsals Assessment 12 e-learning Self-directed study 90 Group work Other (specify) Total 150 You will be required to attend a 2 hour lecture/workshop where they will be expected to cover some of the academic materials as well as the theoretical framework before going on to read case studies and apply the theory to the practice. You will have breakout sessions whereby they discuss the ideas presented in case studies and then critically debate the transferability of the lessons to the case in hand.

Student Activity (10 notional learning hours = 1 credit)

Approach to Learning

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Skills Development

Assessment Strategy

Communication To help with the development of this you will present your ideas to the remainder of the cohort. Information Literacy To help with the development of this you will be able to source and identify the relevant information required in the financial press. Research and Evaluation To help with the development of this you will identify and extract the required information such that you are able to utilise it for analysis of the problem at hand. Creativity and Critical Thinking To help with the development of this you will develop the most appropriate models that can be utilised in order to apply them to the most conducive scenarios. This unit has two assessment points. The first assessment is an in-class test that is scheduled around the middle of the teaching schedule. The in-class test will require you to be able to apply the theoretical knowledge that they have attained from their studies to data on a specific company that is pre-selected for them. There is a final assignment submission whereby you are required to sit a 2 hour closed book examination based on both the numerical and theoretical aspects of Corporate Finance.

No 1 2

Assessment Method* IT EX

Description of Assessment Method In Unit Test Examination

Weight % 30% 70%

Learning Outcomes Assessed 1 2 3 4 5

Submission week (assignments) or length (exam)

Approximately Week 6 Week 14-15

AR CB CS DI EX GR IT LR

*The following codes for assessment methods apply:artefact PC practical computer-based PF performance case study PL placement dissertation or project PO portfolio exam PR presentation group report RE individual report in-unit test OR oral literature review OT other

SECTION 3 - Once initial approval of the unit has been given, the Unit Co-ordinator may make changes to this section, following appropriate consultation

Outline Teaching Schedule Measures Of Shareholder Wealth Dividend Policy Capital Structure Mergers and Acquisitions Options Trading Market Efficiency End Of Term Examination
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Recommended Resources Essential Sangray, Sudesh. Case Studies In Corporate Finance, Cambridge Publishing. Volume 2.

Recommended Reading th Brealey, R. Myers, S & Allen, F., 2007. Principles of Corporate Finance with S&P bind-in Card. 9 ed. McGraw- Hill International Edition. ISBN 9780071266758. Allen, F. and R. Michaely Dividend Policy in Jarrow, Maksimovic and Ziemba (eds) Handbook of Finance. (Elsevier Science, 1995).[No ISBN available]. Haugen, R. and J. Lakonishok The incredible January effect. (Homewood, Ill.: Dow JonesIrwin, 2008) [ISBN 9781556230424]. Ravenscraft, D. and F. Scherer Mergers, Selloffs, and Economic Efficiency. (Washington D.C.: Brookings Institution, 1987) [ISBN 9780815773481

SECTION 4 Administrative Information Faculty Field Department/School/Division Unit Co-ordinator Version Number Body approving this version Date of University approval of this version (dd/mm/yyyy) FTQSC Business School MSc Business & Management MSc International Business Management Division of Accounting & Finance Dr. Sudesh Sangray

Shared Units Indicate below all courses which include this Unit in their diet MSc Finance & Business MSc International Business Management MSc Business and Management

Form completed by: Name: Dr. Sudesh Sangray Date:

Authorisation on behalf of the Faculty Teaching Quality and Standards Committee (FTQSC) Chair: Date: ...

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Unit Updates Date (dd/mm/yyyy) Nature of Update FTQSC Minute Ref:

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