FIN 20150CORPORATE FINANCIAL MANAGEMENT

Mendoza College of BusinessUniversity of Notre Dame

William Stephens, CFA Spring 2014Email: Stephens.48@nd.eduCell Phone: (630) 272-2800

Objective:

This course will emphasize a practical application approach to financial theory and corporate financial management. Fundamentals of the time value of money, financial statement analysis, valuation, modern portfolio theory, cost of capital and other core concepts will be covered. Based on your understanding of this curriculum, you will be prepared to explore advanced courses in finance and investments. Serious students will acquire a valuable knowledge base in the business of financial management. This course is your beginning point in achieving the skills necessary to become a qualified financial or investment analyst in the real world of business and investment management.

Required Materials:

Text – Fundamentals of Corporate Finance, Ross, Westerfield and Jordan, 2013, 10th edition, McGraw-Hill / Irwin. The hard cover textbook can be purchased at the Notre Dame bookstore. Alternatively, a bundle of ancillary materials is available including a loose leaf textbook, an electronic version of the text and “Connect,” an online self-study tool.

Financial Calculator – The TI BA II Plus is the calculator referenced in the text. This calculator will work perfectly well for the course. However, I recommend the HP 12C, and this is the calculator I will be using in class. The teaching method will concentrate on a comprehensive understanding of the mathematics underlying the financial theory. A financial calculator may be used for number crunching once the student has a solid grasp of “longhand” solutions to problems.

Course Requirements:

The sequence of textbook readings is shown in the attached course outline.

End-of-Chapter problems will be assigned for self-study and class discussion.

Occasional excerpts from the financial press will be disseminated and used for discussion purposes.

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Grade Determination:

There will be two mid-term exams and one final exam. They will be equally weighted. The final exam will cover the last one-third of the semester material, but will be cumulative to the extent that some earlier concepts intersect later ones. As a small project, guidance will be given for the creation of an elementary pro forma financial model using Excel spreadsheet software.

Exam 1 February 11 30%Exam 2 April 1 30%Final Exam Week of May 5 30%Pro Forma Excel Spreadsheet Project 5%Class Participation 5%

Class Preparation and Participation:

Students are expected to remain current in the assigned materials so as to fully comprehend the lectures and participate effectively. Brief episodes of the Socratic Method may be invoked at random intervals to encourage preparation and participation. (http://en.wikipedia.org/wiki/Socratic_method)

Honor Code:

The University’s Code of Honor will be respected and followed at all times. Giving or receiving help of any kind on an exam is a clear violation of the Code of Honor. You will want to truly know and understand the course material in addition to scoring well. This policy will serve you well in this course as well as in your future studies and your career. (http://nd.edu/~hnrcode/docs/handbook.htm)

Office Hours:

Tuesday and Thursday 12:30 – 2:00 PMTuesday 5:00 – 6:00 PMMendoza location TBA

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FIN 20150CORPORATE FINANCIAL MANAGEMENT

COURSE OUTLINE Textbook

Date Topics AssignmentJanuary 14 Intro and Financial Statements Ch 1 – 2January 16 Financial Statements Ch 2 – 3January 21 Valuation and Time Value of Money Ch 5January 23 Valuation and Time Value of Money Ch 5January 28 Valuation and Time Value of Money Ch 5 – 6January 30 Valuation and Time Value of Money Ch 6February 4 Valuation and Time Value of Money Ch 6February 6 Net Present Value Ch 9February 11 Net Present Value Ch 9

February 13 FIRST EXAM

February 18 Bond Valuation Ch 7February 20 Bond Valuation Ch 7February 25 Stock Valuation Ch 8February 27 Stock Valuation Ch 8March 4 Capital Allocation Ch 10March 6 Capital Allocation Ch 10March 11 Case Study & Pro Forma Financial Model HandoutMarch 13 Returns, Risk & Capital Market Theory Ch 12

March 17 – 21 SPRING BREAK

March 25 Returns, Risk & Capital Market Theory Ch 12

March 27 SECOND EXAM

April 1 Modern Portfolio Theory Ch 13April 3 Modern Portfolio Theory Ch 13April 8 Modern Portfolio Theory Ch 13April 10 Cost of Capital Ch 14April 15 Cost of Capital Ch 14April 17 Leverage and Capital Structure Ch 16April 22 Leverage and Capital Structure Ch 16April 24 Personal Finance and Special Subject HandoutApril 29 Personal Finance and Review Session Handout

Week of May 5 FINAL EXAM

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