|
|
|
|
|
|
|
|
|
|
|
|
|
|
BA 340: Finance
Fall 2006
Syllabus
Instructor: Bob Johnson Prerequisites: ECON
201, BA 213 or BA 215
Phone: 737-6044 Class
Schedule: M,W
Office: Bexell 339 Office Hours: M -
E-mail: johnsonr@bus.oregonstate.edu and
by appointment
About This
Course:
Welcome
to Finance! Managerial Finance is a
vital subject in the business curriculum.
Employees in all areas of the organization have found that they must
understand finance concepts and applications if they are to function
effectively. The rising importance of
managerial finance is due not just to advances in theory and practice. In the
contemporary, competitive business environment, the successful, effective
financial analyst/manager is a fully integrated business partner with the functional area(s) he or she
supports. The Finance function is the
one place in the organization where all contributions from the various
functional areas, e.g. Marketing, Manufacturing, Engineering, Supply Chain,
Research and Development, Human Resources, come together. Accordingly, the financial analyst/manager
must have a thorough understanding of the operational processes within the
enterprise.
Consistent
with the preceding, the principal objectives of this course will be to:
·
Establish the foundation of finance theory
·
Develop an understanding of the analytical tools available
to the financial analyst
·
Develop skills in the application of managerial finance
concepts and practices
·
Develop a thorough understanding of the role of the
financial analyst in today’s enterprises
For
many (probably most) of you, this will be the only Finance course you will complete. At the end of the course, you should take
away a number of finance skills that you can apply in your personal lives, such
as a command of interest rate mathematics, the framework for making investment
decisions, the pervasive relationship between risk and return, the structure of
the bond and stock markets, and basic valuation tools for debt and equity
securities.
About
Me:
I
have taught Finance, Accounting and Economics at several universities. I was a regular Finance faculty member at OSU
for five years in the 1980s, prior to going to work in Finance at
Hewlett-Packard. I had the chance to
take early retirement from HP in June 2004.
I worked in the inkjet printing
supplies business throughout my 15+ years at HP, retiring in the position of
Financial Operations Manager. In my last position at HP, I supervised a
team of 10 financial analysts who provided business support and leadership for the
Supply Chain organization. My career at HP was very interesting, and one
of its great ancillary benefits was the opportunity to do quite a bit of
international travel. In addition to traveling to the HP manufacturing
sites in
Instructional
Approach:
The
course will be a blend of current finance theories and practices. A variety of instructional media will be
used, including lecture, discussion, problem solving and case study analysis. We will try to vary the proceedings in each
class meeting. We will take a 5 minute
break approximately halfway through each class meeting. Topics will be related
to current business practices and current events whenever possible. When current events of substantive finance
significance arise, we will devote class time to these topics. If I miss a current event that you discover,
please share it with the rest of the class.
Text: Financial
Management: A Modern Approach, Addison-Wesley, Prelim. Edition, Brooks
(required)
The Wall Street Journal (optional – will be used in class as
relevant articles appear)
Financial
Function Calculator: e.g. TI Business Analyst II or HP 10bII (optional)
Electronic
Spreadsheet Skills: Familiarity with
elementary electronic spreadsheet techniques is expected.
Evaluation: Portion
of Course Grade
Problem Sets (4 @ 25 points each) 100
points
Midterm Examination 100
points
Final Examination 100
points
Total points possible 300
points
Review
Questions and Problems from the text are called out in the class schedule that
follows. Each student is expected to complete
the reading assignment and work the Review Questions and Problems prior
to the class meeting for that topic. The
assigned Review Questions and Problems will be covered in class, as time permits. Since much of the study of Finance is
quantitative in nature, it is very important not to fall behind in the course
work. Course materials will be
distributed on Blackboard. Students may
find it helpful to download course materials in advance of class. Printing out the PowerPoint files 3 slides
per page leaves space in the right-hand part of the page to take notes. Many problems will be solved using Microsoft
Excel. I will post these worksheets to
Blackboard also. Usually, I will post a
partly completed worksheet that you can use to solve the problems, as well as a
completed worksheet (after the class meets) on which you can check your
solutions. Solutions to all odd-numbered
end-of-chapter Review Questions and Problems, including those that aren’t
assigned, will be posted on Blackboard.
This affords an excellent opportunity for additional practice to test
your understanding of the concepts. Please
check the course Blackboard web page regularly for updates, announcements and
new postings:
Blackboard
login is accomplished using your ONID email account name and password. After you’ve logged in, go to the BA340 web
page for your section. I will post
Problem Sets and solutions to the “Assignments” folder and all other materials
to the “Course Information” folder.
Four
Problem Sets will be distributed. These
will be collected on the dates indicated in the class schedule and graded. Please submit your assignments in printed,
rather than electronic, form. You are
welcome to collaborate on the Problem Sets in small groups (5 or fewer students
per group) and submit one assignment for your group. Late assignments will not be accepted. Problem Sets may be completed manually, as
long as the writing is neat and legible.
Problem Sets will be distributed in class and they will be posted
to the course web page on Blackboard.
Solutions to each Problem Set will be posted to Blackboard after they
are collected.
Appeals
of grades on Problem Sets, Examinations, etc. must be made within one week from
the date that the assignment/exam is returned.
Please submit a written explanation of why you feel that your grade is
in error.
Examinations
will consist of numerical problems, short essays and multiple choice questions.
For each of the examinations, students
will be allowed to bring a letter-sized (8 ½ “x 11”) page with notes, formulas,
equations, etc. to be used on the examination.
Both sides of the page may be used.
The page of notes will not be collected.
In addition to the page of notes, each student should bring the
following to examinations:
- Electronic
calculator
- Compound
interest tables
- Pencil
for marking multiple choice answer sheet.
Make
up examinations will be given only under very extraordinary circumstances, e.g.
documented illness, death in the family.
I will make a determination on a case-by-case basis as to whether a
make-up examination will be provided.
Extra/supplemental
credit is not offered in this course.
Class participation may benefit your final course grade, if you are on
the borderline of a grade cut-off point (see following). I strongly encourage you to ask questions in
class. If something is puzzling you,
there is a good chance that it is puzzling other members of the class
also. I may call on students from time
to time - not as a performance test, but just to check for overall
understanding.
I
will use the following grading scale for this course. These cut-off
points may be lowered, but they will not be raised.
|
Grade |
Percentage
Score |
|
A |
93
up to 100 |
|
A- |
90
up to 93 |
|
B+ |
87
up to 90 |
|
B |
83
up to 87 |
|
B- |
80
up to 83 |
|
C+ |
77
up to 80 |
|
C |
73
up to 77 |
|
C- |
70
up to 73 |
|
D+ |
67
up to 70 |
|
D |
63
up to 67 |
|
D- |
60
up to 63 |
|
F |
Less
than 60 |
Attendance: While I don’t take roll, attendance at all
class sessions is expected and necessary for success in the course. I will strive to make your attendance in
class worthwhile for you. Virtually all
exam questions will be drawn from material covered in class.
Instructor
access: Your learning and success in the course are
important to me. I will be available
during the office hours listed above.
Generally, I can meet with students on a “drop-in” basis, as well. If necessary, we can schedule another time to
get together. Please see me, if you are
having difficulty with any aspect of the course. Also keep in mind that office hours are not
only a time to address problems. I’d be
happy to talk with you about your areas of special interest, careers in
Finance, etc. The best way to get in
touch with me on weekends is by e-mail.
I will check e-mail at least once per day on Fridays, Saturdays and
Sundays.
Tentative Class Schedule
|
Date |
Subject |
|
Review Questions and Problems From Text
|
|
|
Introduction |
|
4,5,6,10 |
|
|
Interest Rate
Mathematics - I |
|
5,7,9,10,19 |
|
|
Interest Rate
Mathematics - II |
|
1,3,7,11 |
|
|
Interest Rate Characteristics |
|
3,5,7,9,11
|
|
|
Risk and Return |
|
5,7,9,11,13,14 Problem Set
#1 Due |
|
|
Valuation of Debt
Securities |
|
1,2,6,10,11,13,19 |
|
|
Valuation of Equity
Securities – I |
|
1,2,3,5,7,11,15,17 |
|
|
Portfolio Analysis |
|
1,2,3,4,9,11,12 |
|
|
Catch up and review |
None |
Problem Set
#2 Due |
|
|
MIDTERM EXAMINATION (covering Chapters
1 - 8) |
|
|
|
|
REVIEW MIDTERM
EXAMINATION – Begin Financial Statement Analysis |
|
9,11,13,17,19 |
|
|
Finish Financial
Statement Analysis |
None |
|
|
|
Valuation of Equity
Securities - II |
TBD |
|
|
|
Capital Budgeting –
I |
|
1,3,7,11,15,19 |
|
|
Capital Budgeting –
II |
|
1,3,5,6,7,8,9,11,15 |
|
|
Cost of Capital |
|
1,5,7,9,13,15,17 |
|
|
Capital Structure |
|
3,7,9,11 Problem Set
#3 Due |
|
|
Dividend Policy |
|
5,7,13,17 |
|
|
Working Capital
Management |
|
1,3,5,7,9,11,13,15,17 |
|
|
Catch up and review |
|
Problem Set
#4 Due |
|
|
FINAL EXAMINATION: (covering Chapters 9 - 15) |
|
(location
for final exam to be announced) |
Supplemental
Internet Resource Links (used to introduce material covered in class meetings
and for future reference):
http://corporateinformation.com
(company profiles)
http://profiles.wisi.com/ (Wright
Investors Service – company profiles)
http://www.fma.org/
(Financial Management Association)
http://www.afajof.org/ (American Finance
Association)
http://www.businessfinancemag.com/
(Business Finance Magazine)
http://www.cfo.com/ (Chief Financial Officer Magazine)
http://www.sec.gov/
(access to S.E.C. filings)
http://moneycentral.msn.com/ (Microsoft
personal finance site – receives high ratings in reviews of web sites)
http://www.hoovers.com/ (Company info,
S.E.C. filings, research)
http://www.forbes.com/investing/
(research tools)
http://www.marketguide.com/MGI/
(company info, research tools)
http://www.quicken.com/investments/
(company info, research)
http://www.smartmoney.com/ (company info,
research)
http://www.standardandpoors.com/
(company info, bond ratings)
http://finance.yahoo.com/ (yahoo finance
site)
http://www.zacks.com/ (earnings estimates)
http://www1.firstcall.com/index.shtml
(earnings estimates)
http://www.aaii.com/ (American Association of
Individual Investors – good resource for investing basics)
http://www.fundadvice.com/ (excellent
resource for mutual fund investing – good articles and model portfolios)