Part 1 Course Guide

.

Part 1

Course Guide

BMMF5103

Managerial Finance

BMMF5103 Managerial Finance

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Part 1: Course Guide

Contents

WELCOME TO BMMF5103 MANAGERIAL FINANCE

General aim of the course

Objectives of the course

Course overview

Overview of topics

STUDYPATHS FOR SUCCESS IN THE COURSE

GUIDE TO ASSESSMENT IN POST-GRADUATE COURSES AT OPEN UNIVERSITY MALAYSIA

Assessment format

Facilitator-Marked Assignment (FMA) (55%)

Final Exam (40%)

Online Participation (5%)

References

CONCLUDING REMARKS


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General Aim of the Course The course aims to give you a foundation in managerial finance and explain why

it is important for all functional managers to understand managerial finance.

Objectives of the Course After completing this course, you should be able to:

1. Identify the key objective of firm and understand the key concepts in financial management;

2. Evaluate the financial performance and position of a company;

3. Evaluate the value of stocks, bonds and projects; and

4. Evaluate the various sources of financing.

WELCOME TO BMMF5103 The course BMMF5103 Managerial Finance is one of the required courses

for the Master of Business Administration (MBA) programme. The courseassumes little previous knowledge and experience in financial management.

However, you are encouraged to relate and integrate your work experienceinto this course. This is a three (3) credit course conducted over a 14 weeksemester.


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A. Course Overview

Finance is an exciting yet interesting, challenging and ever-changing discipline.

With the emergence of liberations and globalisation, new technology and innovations have brought a profound impact on the financial practices and

markets. Managers are concerned with acquiring, financing and managing the

business assets under these changes. Thus knowledge on financial management is essential for managers to perform their financial duties.

To enable you to understand Managerial Finance BMMF 5103, we divide this

course into three topics that are the foundation of the course. These topics are shown in the table below.

Table 1: Schedule of Topics

Topic Title Schedule

1 Fundamental Concepts of Financial Management Weeks 1-5

2 Securities and Their Valuation Weeks 6-10

3 Projects and Their Valuation Weeks 11-14

Each of these three topics is guided by a Study Guide which is

communicated to you through (a) the online forum in myLMS before the first tutorial and (b) in print form after you have registered for the

course.

You will follow the scheduled weekly activities and discussions assigned to you in the Study Guide for the duration of the course. All topics and activities are based

on the assigned textbook and discussion on a topic is carried out both in the

online forum and in the face-to-face tutorials. Please remember that deliberation on a single topic will be carried out according to a fixed

schedule as presented in the Study Guide. It is important that you participate in online discussions and group activity so that you can understand each topic

completely.

In the sections below, an overview of the course and a description of the content of each topic are provided.


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B. Topic Overview

Topic 1: Fundamental Concepts of Financial Management

Chapter 1: An Overview of Financial Management. It introduces the various types of organisations, goals of the

corporation and agency relationship.

Chapter 3: Financial Statements, Cash Flows, and Taxes

It Introduces and explains the purpose of balance sheet, profit and loss statement and cash flow statement.

Chapter 13: Analysis of Financial Statements

Using ratio analysis to evaluate the liquidity position, leverage,

profitability and asset management ability of the company.

Chapter 4: Risk and Return: The Basis It introduces the parameters used in investment decision and

benefits of diversification.

Chapter 2: Time value of Money It introduces the importance of time line, future and present

values for both even and uneven cash flows.

Topic 2: Securities and Their Valuation

Chapter 5: Risk and Return: Portfolio Theory and Asset Pricing Theory

It shows how portfolio return and risk are computed for the assets. The various factors affecting the portfolio risk are also

explained. The popular asset pricing is presented and demonstrated how the required rate of return of an asset is

determined.

Chapter 6: Bonds and Their Valuation

It discusses the key features of bonds and their valuation. This includes bonds with semi-annual coupon and the impact on bond

prices when there is a change in market interest rate.

Chapter 7: Stocks and Their Valuation It discusses the key features of stocks and the legal rights and

privileges of shareholders and stocks valuation.

Topic 3: Projects and Their Valuation

Chapter 9: The Cost of Capital It demonstrates the techniques used in determining the cost of

debt, preferred shares and common stock. Weighted average cost of capital is then computed.


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Chapter 10: The Basics of Capital Budgeting: Evaluating Cash Flows It discusses the importance of capital budgeting, project

classification, capital decision rules and the various methods for

evaluating projects viability.

Chapter 11: Cash Flows Estimation and Risk Analysis It focuses on estimating relevant cash flows, tax effects, inflation

on cash flows.

LEARNING SUPPORT

1. Tutorials There are 15 hours of face-to-face tutorials provided in support of the

course. There will be FIVE tutorial sessions of 3 hours each. You will be informed on the dates, times and location of these tutorials, together with

the names and phone number of your facilitator, as soon as you are allocated a tutorial group.

2. MyLMS Online Discussion Besides the face-to-face tutorial sessions, you have the support of online

discussions in myLMS with your facilitator and your coursemates. Your contributions to online discussions will greatly enhance your understanding

of course content, and help you as you read the assigned text, do the assignment and prepare for the examinations.

3. Feedback and Input from Facilitator

As you work on the activities and the assigned text, your facilitator will

provide academic assistance throughout the duration of the course. The facilitator will also mark your assignment and give you the feedback on your

performance. Should you need any assistance, do not hesitate to discuss your problems with your facilitator. The tutorial sessions and the online

forum can also be used for any of the following situations:

when you have difficulty with the self-tests and activities; when you have a question or problem with the assignment;

and

when you do not understand the assigned readings.

It is important to bear in mind that communication is important for you to be able to get the most out of this course. Therefore you should, at all

times, be in touch with your facilitator and coursemates, and be aware of all the requirements for successful completion of a course.

4. The Digital Library

For the purpose of referencing materials and doing library-based research,

OUM has a comprehensive digital library. For this course you may use the following databases: infotrac, proquest and ebsco. From time to time,

materials from these databases will be assigned for additional reading and activities.


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STUDYPATHS FOR SUCCESS IN THE COURSE 1. Time Commitment for Study

You should plan to spend about 20 hours on each topic, which includes the

time spent doing all activities, self-tests, and suggested readings. You ought to schedule your time to discuss your work online and spend enough time on each

topic for this course. It is often more effective to distribute the study hours over a number of days rather than spend a whole day studying one topic.

2. Proposed Study Strategy

The following is a proposed strategy for working through the course. If you

have difficulty following the suggested strategy, discuss your problems with your facilitator either through the online forum or during the tutorial sessions.

(i) The first and most important step is to read the contents of this Course

Guide thoroughly.

(ii) Organise a study schedule. Note the amount of time you are expected to spend on each topic, the submission date of the assignment, tutorials

and the examination dates. Put all this information in one place, such as

your diary or a wall calendar. Whichever method you choose, you should decide on and jot down your own dates for working on each topic. You

have some flexibility as there are 3 topics spread over a period of 14 weeks.

(iii) Once you have created a study schedule, make every effort to ‘stick to

it’. The main reason students are unable to cope is that they delay their course work.

(iv) To begin work on a topic, do the following:

Study the Topic Overview and examine the relationship of one topic to the other topics.

Do all assigned Activities and conduct the Self-test to see if you

have understood the various concepts and facts presented in a topic.

Use the Summary and the Key Terms to check if you understand what you have just read.

Do all Readings to gain knowledge of the various dimensions of

the course.

Work on your assignments as the semester progresses so that you are able to systematically produce a commendable report or paper.

(v) When you have completed a topic, review the Learning Outcomes to

confirm that you have achieved them and that you are, in fact, able to do what is required.

(vi) After completing all topics, review the course content to prepare for the

final examination. Review the objectives of the course to see if you have covered all the relevant parts of the course.


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GUIDE TO ASSESSMENT IN POST-GRADUATE

COURSES AT OPEN UNIVERSITY MALAYSIA In the following pages, the Assessment Guide explains the basis on which you will

be assessed in this course during the semester. It contains details of the facilitator-marked assignment, the final examination and participation required

for the course.

One element in the assessment strategy of the course is that all students should have the same information as their facilitators about how performance on the

various tests and assignments is assessed. For this reason, this guide also

contains the marking criteria that will be used to assess the work you submit for each requirement.

Please read through the entire guide at the beginning of the course.

Assessment Format There are THREE aspects to the assessment of the course: assignment, final

examination and participation. A summary of the assessment requirements and the dates for these requirements are shown in the table below.

Table 2: Assessment Format

Component Marks Due Date

Final Exam Final Exam (3 hours) 40%

Examinationweek at the end

of the semester

Assignment 55% Seminar 4

OLP 5% End of semester before

examination

week

1. FACILITATOR-MARKED ASSIGNMENT (55%)

There is ONE Facilitator-Marked Assignments (FMA) in this course and it accounts for 55% of the total course assessment. You need to complete the

activities for topics 1, 2 and 3 before working on the assignments.

You will begin by accessing the assignments in the online forum and

complete the assignment using the information and materials contained in the Study Guide and the Assigned Text. However, it is desirable in all

graduate level education to demonstrate that you have read and researched more widely than the required minimum. Using other references will give

you a broader perspective on the course, and may provide a deeper understanding of the subject.

When you have completed the assignments, submit it, together with a FMA

form, to your facilitator. Make sure that your assignments reach the

facilitator on or before the deadline.


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General Criteria for Assessment of Assignment

In general, your facilitator will be expecting you to write clearly, using correct

spelling and grammar. Your facilitator will be looking for evidence that you have done the following:

a) Reflected critically on issues raised in the course.

b) Considered and appreciated a range of points of view, including those in the

course, and developed your own view.

c) Stated your argument clearly with supporting evidence and proper referencing

of sources.

d) Drawn on your own experiences and integrated this information in the paper.

2. FINAL EXAMINATION (40%)

The FINAL EXAMINATION accounts for 40% of the total course assessment and it

usually lasts 3 hours. The examination covers materials from the course content and it aims to examine if the learning outcomes of the course have been

achieved. Students should demonstrate that they have achieved these outcomes

in the examination.

The questions in the final examination are closely related to questions in the Study Guide and all areas of the course will be assessed. Hence you may find it

useful to review all items in the Study Guide in preparation for the examination.

3. ONLINE PARTICIPATION (5%)

From time to time, you will be required to work on activities posted in the online forum in myLMS for the various topics of the course. Your facilitator may ask you

to respond to a question or issue or to comment on some of the content covered during the face-to-face tutorial sessions. You may also be asked to discuss the

assignments in the online forum so that you and your course mates benefit from deliberation and debate on course content.

It is therefore important to participate in the online forum often and respond to the

questions or comments of a classmate or the facilitator. Your specific responses will

be graded on the basis of quality, and the integrated assessment scheme for this purpose is presented below. Your participation in the discussion, particularly the

degree to which your contribution indicates knowledge of the readings and thoughtfulness on your part, is deemed important. The way your personal

contributions create interest and move the discussion forward will be used to determine your grade for this component of the course.

You will be assigned a maximum of 5% of your overall grade for participation in

tutorial sessions and online discussion sessions. Your participation, through

discussion with fellow students and the course facilitator, is very important to the understanding of subject matter.


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Table 3: The Integrated Assessment Scheme for Online Participation

Category Description Points

High

i. High quality contributions focused on task; strong evidence of learner having generated discussion, analysed information, drawn conclusions and helped create a lively debate

ii. Contributions have been regular and varied without long lapses between postings

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iii. Contributions have been focused on the task; some evidence of analysis, sharing and teamwork

iv. Learner has been present online but postings have been

few and far between

4

Moderate v. Some contributions have been focused on the task;

however there little or no evidence of analysis, sharing and

teamwork

vi. Student is not an active contributor

3

Low

vii. Some contributions have been focused on the task; little or no evidence of analysis, sharing and teamwork

viii. Learner is rarely present online 2

ix. Contributions have been minimal with little evidence of task focus

1No

Participation

x. Zero contributions have been made toward the discussion or task

0

PLAGIARISM

What is Plagiarism? (Note: This information has been sourced from: www.psych.mcgill.ca/ugrad)

Any written assignment (essays, project, take-home exams, etc) submitted by a student must not be deceptive regarding the abilities, knowledge, or amount of

work contributed by the student. There are many ways that this rule can be violated, and plagiarism may have been committed. Here are some examples of

plagiarism.

Outright plagiarism: Large sections of the paper are simply copied from other

sources, and are not acknowledged as quotations.

Paraphrasing: The student paraphrases a closely reasoned argument of an

author without acknowledging that he or she has done so. Clearly, all our

knowledge is derived from somewhere, but detailed arguments from clearly identifiable sources must be acknowledged.

Other sources: Essays or papers written by other students or sold by unscrupulous organisations are submitted by students.

Works by others: Taking credit deliberately or not deliberately for work

produced by another without giving proper acknowledgement. This includes photographs, charts, graphs, drawings, statistics, video-clips, audio-

clips, verbal exchanges such as interviews or lectures, performances on television and texts printed on the web.

Double Credit: The student submits the same essay to two or more

courses.


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Avoiding Plagiarism (Note: This information has been sourced from: http://www.homestead.com/)

Insert quotation marks around ‘copy and paste’ clause, phrase, sentence, paragraph and cite the original source

Paraphrase clause, phrase, sentence or paragraph in your own words and cite

your source

Adhere to the APA (American Psychological Association) stylistic format, whichever applicable, when citing a source and when writing out the

bibliography or reference page

Attempt to write independently without being overly dependent of information

from another’s original works

Educate yourself on what may be considered as common knowledge (no copyright necessary), public domain (copyright has expired or not protected

under copyright law), or copyright (legally protected).

Documenting Sources

Whenever you quote, paraphrase, summarize, or otherwise refer to the work of

another, you are required to cite its source parenthetical documentation. Here are some of the most commonly cited forms of material. (Note: The reference for

this information is http://www.horton.ednet.ns.ca).

Direct Citation Simply having a list of thinking skills is no assurance that children will use it. In order for such skills to become part of day-to-day behaviour,

they must be cultivated in an environment that value and sustains them. “Just as children’s musical skills will likely lay fallow in an environment that doesn’t encourage music, learner’s thinking skills

tend to languish in a culture that doesn’t encourage thinking” (Tishman, Perkins & Jay, 1995, p.5)

Indirect Citation According to Wurman (1988), the new disease of the 21st century will be information anxiety, which has been defined as the ever-widening gap between what one understands and what one thinks one should

understand.


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Referencing

All sources that you cite in your paper should be listed in the Reference section at

the end of your paper. Here’s how you should do your Reference page. (Note: The reference for this information is owl.english.purdue.edu/handouts).

From a Journal Brown, E. (1996). The lake of seduction: Silence, hysteria, and the space of feminist theatre. JTD: Journal of Theatre and Drama,2, 175-200.

From an Online Journal

Evnine, S. J. (2001). The universality of logic: On the connection between rationality and logical ability [Electronic version]. Mind,

110, 335-367.

From a Webpage National Park Service. (2003, February 11). Abraham Lincoln

birthplace national historic site. Retrieved February 13, 2003, from http://www.nps.gov/abli/

From a Book Fleming, T. (1997). Liberty! The American revolution. New York:

Viking.

From an Article

in a Book

Cassel, J., & Zambella, B. (1996). Without a net: Supporting

ourselves in a tremulous atmosphere. In T. W. Leonhardt (Ed.), "LOEX" of the West: Teaching and learning in a climate of constant change (pp. 75-92). Greenwich, CT: JAI Press Inc.

From a Printed Newspaper

Holden, S. (1998, May 16). Frank Sinatra dies at 82: Matchless stylist of pop. The New York Times, pp. A1, A22-A23.

CONCLUDING REMARKS

This course aims to give you a foundation in managerial finance which provides

the fundamental concepts, asset analyses and valuations, and sources of financing.

We wish you success with the course and hope that you will find it interesting and useful for your development as a professional. We hope you enjoy your

experience with OUM and will continue your work as a life long learner with us.

REFERENCES

Brigham, E. F., & Ehrhardt, M. C. (2005). Financial management - Theory and practice (11th ed.). South Western: Thomson Publishing.

McGuigan, J. R., Kretlow, W. J., & Moyer, R. C. (2006). Contemporary financial

management (10th ed.). South-Western: Thomson Publishing.

Part 1 Course Guide

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Transcript of Part 1 Course Guide