FINA 5170 OFFICE: BA 155-G
FINANCIAL MANAGEMENT
SPRING 2008 PHONE: (940) 565-3075
DR. STEVE COLE CSCOLE@UNT.EDU *
DEPARTMENT FAX (940) 565-4234 *Preferred Contact Method
OFFICE HOURS
Denton Campus
5:00p.m.- 6:00p.m. WR
Frisco
5:30p.m. - 6:30p.m. M
COURSE DESCRIPTION
FINA 5170. Financial Management. 3 hours. Tools and techniques used and proposed in corporate financial management. Analysis of the investment and financing decisions and the environment in which such decisions are made are covered in readings, case problems and class discussion. Prerequisites: ACCT 5020, FINA 5040, ECON 5000, MATH 1190, BCIS 5090, DSCI 5010, and completion of or concurrent enrollment in ACCT 5130, or consent of department.
COURSE OBJECTIVES
The course is intended to provide students:
• An overview of the basic concepts and principles of financial management, with particular emphasis on risk, rates of return, and valuation.
• An overview of contemporary financial events as they occur.
• The opportunity to practice problem solving skills to solve common financial problems.
The Finance Department strongly recommends completing all prerequisites prior to FINA 5170. The FINA syllabus and the MBA-level finance textbook are designed around the assumption that a student possesses the equivalent knowledge of a student that has successfully completed all of its prerequisites. FINA 5170 cannot replace the knowledge, skills, and attitudes of all these courses so students without the prerequisite courses have, in the past, had difficulty in completing the course requirements of FINA 5170 successfully.
TEXT
Berk, Jonathan and Peter DeMarzo. Corporate Finance, Pearson Education, Inc. 2007.
CALCULATOR
A financial calculator is required for in-class use and for exams. Your calculator should be able to solve for internal rates of return using uneven cash flows. TI-BAII Plus, HP-17B, HP-19B, and the HP 10-BII are suitable calculators. I will be using a TI- BAII Plus in class. Programmable calculators may not be used for any in-class exams.
OPTIONAL MATERIALS
The Wall Street Journal. The Journal is a good way to begin a lifelong pattern of professional reading. We will be discussing significant financial events as they occur. In addition, I will assign articles from The Wall Street Journal relative to these events. During the semester a series of seven quizzes will be given over these assigned articles. The best five scores will count equivalent to a scheduled exam score and will count as 20% of your course grade. No make ups will be given for missed WSJ quizzes. A Missed quiz will count as one of the two dropped low scores. Each student must have regular dependable access to The WSJ during the semester. An opportunity to subscribed will be provided in class at the beginning of the semester. In addition, you may sign up for The Wall Street Journal at http://wsjstudent.com. The UNT library subscribes to The WSJ so you can read it there for free. Many of you, also, have access to it at your places of employment. I recommend that you subscribe or get into the habit of reading a business daily or a business weekly publication regularly. One of the major problems in learning Finance is understanding the business terminology and becoming comfortable with the jargon. Repeated exposure helps alleviate this problem. If you want to major in Finance, recognize that Finance professionals read The Wall Street Journal and expect you to be fluent on current issues.
EXAMS
During the semester there will be two scheduled exams each worth 20% of the course grade and a comprehensive final worth 40% of the course grade. If either of the two scheduled exams is missed, for whatever reason, the comprehensive final will count as 60% of the course grade. If the final exam percentage score is higher than either of your scheduled semester exam percentage scores, I will substitute it for the lower schedule semester exam score when calculating your course percentage. The exams will be given only on the dates scheduled with no exceptions. Make-up exams will be given only for official University authorized absences (See Graduate Catalog.) The Grade Components are summarized as follows:
First scheduled exam (20% of course grade) 100 points
Second scheduled exam (20% of course grade) 100 points
WSJ quizzes (best five of seven 20% of course grade) 100 points
Comprehensive final (40% of course grade) 100 points
Total points possible 400 points
Additional information about the exams follows:
• Major focus is on chapter concepts, problems worked in class and analytical solutions.
• Each scheduled exam and the comprehensive final is worth 100 points.
• If the final exam percentage score is higher than either of your scheduled semester exam percentage scores, I will substitute it for the lower scheduled semester exam score when calculating your course percentage.
• Make-up exams will be given only for official University authorized absences.
• No make-up WSJ quizzes will be given.
COURSE GRADING SCALE
Average course grades of
• 90% or greater A
• 80%-89% B
• 70%-79% C
• 60%-69% D
• 59% or below F
This grading scale may be lowered at my discretion when assigning final grades.
LECTURE STRUCTURE
The comprehensive source of information about finance is your textbook. My teaching goal in my lectures is to ensure that you learn enough during the lectures to be able to master the chapter reading. It is my intent to enhance and amplify the chapter reading but not to replace it as a comprehensive source of knowledge.
Frequently, I will take a problem-solving approach in introductory courses by solving end-of-chapter problems and developing the underlying theory while arriving at the solution. Attending class is very important to develop your understanding of finance and your mastery of the chapter material. Finance is a contact sport and it is nearly impossible to grasp concepts without solving problems. In my years of teaching experience students who struggle with Finance, typically, do not spend enough time with problem solving – what I call, getting their hands dirty.
TEXTBOOK CHAPTERS AND LECTURE TOPICS
The purpose of my lectures is to enable you to succeed in your quest to learn and master the essential elements of financial management needed for MBA-trained managers in today’s work environment.
Week 1 Chapters 1 and 3: The Corporation; Arbitrage and Decision Making
January 14
Week 2: MARTIN LUTHER KING, JR. DAY
January 21
Week 3 Chapter 4: Time Value of Money
January 28
Week 4 Chapter 5: Interest Rates
February 4
Week 5 Chapter 6: Investment Decision Rules
February 11
Week 6 First Scheduled Semester Exam
February 18
Week 7 Chapter 7: Fundamentals of Capital Budgeting
February 25
Week 8 Chapter 8: Valuing Bonds
March 3
Week 9 Chapter 9: Valuing Stocks
March 10
Week 10: SPRING BREAK
March 17
Week 11 Chapter 10: Capital Markets and the Pricing of Risk
March 24
Week 12 Second Scheduled Semester Exam
March 31
Week 13 Chapter 11: Optimal Portfolio Choice
April 7
Week 14 Chapter 12: The Capital Asset Pricing Model
April 14
Week 15 Chapter 14: Capital Structure in a Perfect World
April 21
Week 16 Slack and Review
April 28
Week 17 Comprehensive Final Exam
May 5
NOTE: Other than the scheduled exams, this schedule may be changed at my discretion. Regardless, no material will be covered on an exam prior to that material being covered in class.
COURSE POLICIES AND PROCEDURES
EXAM POLICIES
(CPP 1) We will have two midterm exams and one comprehensive final exam. During the exams, you may use a calculator. No programmable calculators may be used during exams. You may also use one 8½ X 11 reference sheet during each of the exams. Both sides of this reference sheet may be used with no attachments. No other information may be used on exams. All cell phones, pagers, two-way communication devices, etc. must be turned off during exams.
(CPP 2) Regular scheduled semester exams and WSJ quizzes will be returned in class. Grade appeals must be submitted to me within one week from the date that the exam or quiz is returned in class. If you have a grade appeal for a question on your exam or quiz, you must write your appeal as a memorandum detailing why you believe that your question should be graded again. Upon receiving a grade appeal, I will review and re-grade you entire exam or quiz within one week. I will correct arithmetic errors without regrading the entire exam or quiz, but I will still need a written message to explain the problem. The message may be written on the top of the page of the exam or quiz.
(CPP 3) You are welcome to discuss class issues with me at any time during my office hours or by e-mail with the following exception: After noon on the day before the exam and on the day of the exam. I will not answer questions about that exam’s material. When I hand back an exam in class, I will discuss individual exams individually in my office. See CPP 2 above for more information and keep in mind CPP 5 below.
(CPP 4) Notify me prior to missing an exam, or as soon as possible after missing an exam. It is impossible to give a make-up exam that is fair to both you and the rest of the students in the class so I will automatically assign the weight for that excused regular scheduled semester exam to the final exam score with CPP 5. Unexcused absences receive a grade of zero percent, but see CPP 5.
(CPP 5) Low regular scheduled semester exam policy. If your final exam score is higher than one of your two regular scheduled semester exam scores, I will substitute your final exam score for your lowest exam score. For the purpose of this policy, an excused absence counts as the lowest score for the two regular scheduled semester exams. An unexcused absence can not be substituted for and will count as a zero percent.
(CPP 6) Although I do not expect academic dishonesty such as cheating or plagiarism in my classroom, the penalty for cheating or plagiarism is an F for the course. Cheating occurs when a student looks at other students’ papers during an exam or quiz, allows another student to look at their paper during an exam or quiz or uses material other than those listed in CPP 1 during an exam or quiz.
ADA Statement
(CPP 7) The College of Business Administration complies with the Americans with Disabilities Act in making reasonable accommodation for qualified students with disability. If you have an established disability as defined in the Americans with Disabilities Act and would like to request accommodation, please see me s soon as possible before the end of the third week of classes. My office hours and office number are shown on this syllabus.
Attendance
(CPP 8) While my grading system does not include an attendance policy, I strongly urge students to attend class in accordance with the University policy which states regular and punctual class attendance is expected.
Professional Behavior Guidelines
(CPP 9)
Tardiness: Please try to arrive on time. If you are later than five minutes after the start of class, please enter quietly. Be aware that entering the room disturbs the concentration of the your classmates that are actively learning the material. Remember the University policy states regular and punctual class attendance is expected.
Side Conversations: Side conversations make it difficult for you classmates to actively listen and learn. Besides I am capable of creating enough confusion without assistance.
Sleeping: Get a good night’s rest before coming to class. Falling asleep during class is not considered professional behavior.
Cell phones should be placed on silent. Please restrict conversations to outside the classroom (this includes text messaging.)
While in class, focus and actively listen to the material being presented in class. Do not be involved with other material unrelated to this class and the current lecture.
Laptop computers may be used in my class only for the purpose of taking lecture notes (this excludes the use of wi-fi during the class.)
Miscellaneous Policies
(CPP 10) I do not give additional projects to increase one’s grade before or after the final exam. Grades in this class are determine with the guidelines and policies expressed in this syllabus.
(CPP 11) You may audio-tape my lecture only for your exclusive use in this course. My lectures and lecture notes are part of my intellectual property and should be respected as such.