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Prospectus

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Advanced Financial Management

Course
2013-2014

Tag(s)

[BSc] En, PSc, Ec

Admission Requirements

  • Business and Entrepreneurship

  • Financial Management

Students that do not meet this prerequisite should contact the instructor regarding the required competencies before course allocation.

Description

Advanced Financial Management is the second financial course in the minor business studies. The focus of the course is on corporate finance. Corporate finance is about the efficient attracting and investing of corporate funds. A major issue is the trade-off between risk and return. Analysis of investments is done with the use of particular investment appraisal techniques. An important issue is the identification of the appropriate cash flows. Furthermore, the funding of the corporation is studied, to start with the cost of capital. Different types of equity financing will be discussed, as well as the capital structure of equity and debt financing. The causes and effects of the credit crisis are integrated in all topics that relate to the financial markets.

Course Objectives

  • To gain knowledge and skills in corporate finance and the links with other topics in business studies, with regard to the topics of investment and project appraisals, capital structure, cost of capital and mergers and acquisitions.

  • To understand the different perspectives on corporate finance (investors, managers and intermediaries).

  • To understand how the financial markets function.

  • To understand the causes and effects of the credit crisis, and the latest developments in the financial markets.

Mode of Instruction

The classes are taught with a combination of instruction, group-wise solving of practical and theoretical problems with exercises and much discussion on the links between theory and practical issues in corporate finance. Students are expected to actively participate in finding solutions to exercises and in the discussions.

Class instruction is done with the use of PowerPoint sheets and multimedia martial on course contents and recent developments in the financial markets.
Assessments are done with exams and written assignments. These are all individual.

Assessment

Assessment: Mid-term exam (closed book)
Learning aim: Understanding of course content
Percentage: 20%
Deadline: Week 4 – 22nd November

Assessment: Case study; written assignment (to be done at home, minimum of 750 words).
Learning aim: Ability to analyze practical issues in the financial markets.
Percentage: 20%
Deadline: Week 5 – 29th November

Assessment: Short analysis of scientific article; written assignment (to be done at home, minimum of 1,000 words); list of articles to be chosen to be provided in the reader on Blackboard.
Learning aim: Understanding of theoretical foundations
Percentage: 20%
Deadline: Week 7 – 13th December

Assessment: Final exam (closed book)
Learning aim: Expression of holistic understanding of the course
Percentage: 40%
Deadline: Week 8 – 20th December

Literature

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Contact Information

Dr. R.P. Orij, r.p.orij@law.leidenuniv.nl

Weekly Overview

  1. Intro + Financial Markets and Banks
    1. Investment Appraisals
    2. Project analysis
    3. Cost of capital
    4. Financing of a Corporation
    5. Capital Structure Mergers and Acquisitions
    6. Risk Management

Preparation for first session

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