MANG2015 Financial Management
Module Overview
This module provides a deep insight in some key theories and topics in Financial Management. The module looks at how firms and corporation manage financial investment and decisions in the long term and short term. The module will discuss topics ranging from how firms evaluate financial performance, decision regarding investment in capital, how firms decide in dividend policy.
Aims and Objectives
Module Aims
to introduce you to key concepts in corporate financial management. The module aims to develop understanding of the role and purpose of financial management, with particular reference to investment appraisal, strategy, sources of finance, cost of capital, capital structure, dividend policy, and corporate organisation and restructuring. You should be aware that this module presumes a basic knowledge of financial and economic concepts, a fairly good level of mathematics and that essay writing and reading of academic articles is also important.
Learning Outcomes
Knowledge and Understanding
Having successfully completed this module, you will be able to demonstrate knowledge and understanding of:
- the role and function(s) of financial managers of firms, the important features of the main types of business, the main differences between debt and equity, and the role of financial assets and markets;
- the rules used to make optimal investment decisions;
- the theoretical aspects of financial management, capital structure and dividend policy;
- short and long‐term financing, investment, corporate restructuring and valuation decisions;
- the organisational structures available within the economy and their relationship to the market for corporate control.
Subject Specific Intellectual and Research Skills
Having successfully completed this module you will be able to:
- enhance your critical ability and apply various theoretical concepts to problem solving;
- strengthen your quantitative skills;
- critically evaluate the existing literature and other available sources;
- examine the financial strategy and structure of firms.
Transferable and Generic Skills
Having successfully completed this module you will be able to:
- enhance critical analysis and adopt appropriate methods with respect to specific issues of corporate financial management and problem solving;
- examine the financial strategy and structure of firms.
Syllabus
• Introduction to corporate financial management including the role and purpose of financial management; corporate objectives; time value of money. • Net Present Value and other criteria. Investment and financing decisions. • Working capital management, including costs and benefits of holding additional inventory and cash • Theory of capital structure, including bankruptcy and agency costs. Cost of equity and debt. Weighted average cost of capital. Effect of gearing on risk and return on equity capital, and on cost of capital and firm value. • Long-term financing, including the mechanics of raising capital through issuing equity and debt • Dividend policy including the dividend irrelevance argument and the signalling hypothesis.
Learning and Teaching
Teaching and learning methods
Teaching methods include: • lectures • weekly classes • including reading • use of websites • solving computational problems.
| Type | Hours |
|---|---|
| Preparation for scheduled sessions | 20 |
| Wider reading or practice | 20 |
| Follow-up work | 10 |
| Tutorial | 10 |
| Completion of assessment task | 20 |
| Lecture | 24 |
| Revision | 46 |
| Total study time | 150 |
Resources & Reading list
Brealey, Myers and Marcus. Fundamentals of Corporate Finance.
Assessment
Formative
In-class activities
Summative
| Method | Percentage contribution |
|---|---|
| Examination (2 hours) | 80% |
| Examination (90 minutes) | 20% |
Repeat
| Method | Percentage contribution |
|---|---|
| Examination (2 hours) | 100% |
Referral
| Method | Percentage contribution |
|---|---|
| Examination (2 hours) | 100% |
Repeat Information
Repeat type: Internal & External
Linked modules
Prerequisites: (MANG1007 or MANG1019 or ECON1005 or ECON1008) and (ECON1001 or ECON1003 or ECON1009) or (MANG1020 and MANG1021)
Costs
Costs associated with this module
Students are responsible for meeting the cost of essential textbooks, and of producing such essays, assignments, laboratory reports and dissertations as are required to fulfil the academic requirements for each programme of study.
In addition to this, students registered for this module typically also have to pay for:
Textbooks
Recommended texts for this module may be available in limited supply in the University Library and students may wish to purchase the mandatory/additional reading text as appropriate.
Please also ensure you read the section on additional costs in the University’s Fees, Charges and Expenses Regulations in the University Calendar available at www.calendar.soton.ac.uk.