The American Business School Paris
Area of Study
Taught In English
Course Level Recommendations
ISA offers course level recommendations in an effort to facilitate the determination of course levels by credential evaluators.We advice each institution to have their own credentials evaluator make the final decision regrading course levels.
Recommended U.S. Semester Credits3
Recommended U.S. Quarter Units4
Hours & Credits
OverviewCOURSE DESCRIPTION:This course is an undergraduate course in Business Finance, introduces you to concept of cash, time value of money, risk and return and net present value. The course covers also cash flow and the resulting financing decision. You will learn about debt and working capital and how to build a simple financial planning model.COURSE OBJECTIVES:
Presence in class is mandatory. Bring your book to class. More than 2 absences leads to a failing gradeEXPECTED LEARNING OUTCOMES:After this course you will be able to:1) Define key factors associated with investing decision2) Evaluate project by Calculating Net present value. Understand basic Financial Theory3) Define the key concepts associated with financing decisions4) Explain securities as sources of finance and how firms issue securities5) Construct a simple financial planning model; trace a firm?s sources and uses of cash and evaluate its need for short term borrowing; decide whether it makes sense to give credit to a customerEVALUATIONS:There will be a mid-term exam and a final exam. In addition you are required to read the textbook and do individual homework, as assigned in class, which you will correct in the following class. Your class participation grade will depend on the quality of this work and the quality of the questions you ask in class. Come to class prepared to answer questions when called on. You will also be required to write a paragraph summarizing what you have learnt at the end of each class and be prepared to share it with the class when called on.The final grade will be determined as follows:Participation based on oral and written and homework 20%Quiz 20%Midterm 25%Final 35%COURSE SCHEDULE:Session 11. Kick-off. Sustainable development and finance and revision of basic math and accounting needed for course.2. Ch 1 Goal and Governance of the FirmCh 2 Financial Markets and InstitutionsSession 21. Ch 3 accounting and FinanceInterpret the information used in a balance sheet, income statement and statement of cash flow, accounting versus cash.2. Ch 4 Measuring Corporate performance, Calculate and interpret key measures of corporate performance and of financial performanceSession 31. Ch 5 Time value of MoneyUnderstand the present value of future paymentsCompare interest rates quoted over different intervals2. Ch 8 Net present value and other investment criteria, calculate NPV, internal rate of return (IRR), pay packSession 43. Ch 9 Project analysis, using discounted cash flow analysis to make investment decisions Capital investment, Operating cash flow: change in working capital4. Ch 10 Project analysis, Practical problems and capital budgetingUse sensitivity analysis and break-even analysisSession 51. Ch 11 Introduction to risk and return and the opportunity cost of capital, Estimate the project cost of capital, market risk vs company specific risk2. Revision for midtermSession 6Midterm exam on chapters 1-5, 8-11,(2 hours)Session 71. Ch 13 The weighted cost of capital ( WACC)2. Ch 14 Introduction to Corporate FinancingSession 81. Ch 15 Venture capital, IPO and seasoned offering2. Ch 16 Debt Policy, Perfect capital markets and capital structure, Tax effect of debt policy, financial distress effects on debt policySession 91. Ch 17 Payout policy2. Ethics, finance and history of Financial crisis, Cases, Enron, WorldCom and Tyco, 3 types of Financial scandals, A review of major financial crisisSession 101. Ch 18 Long Term Financial Planning Estimate the effect of growth on the need for external financing Excel modelling and business plan: The Executive Fruit example(chapter 18)2. Ch 19 short term Financial planningConstruct source and uses of cash and evaluate the need for financingSession 11Ch 20 Working Capital, understand the cash implication of working capital, decide whether it make sense to give credit to customerSession 12Revision for final exam.
- Introduce you to the world of Business Finance, both in business and entrepreneurial environment.
- Provide you with the skills to understand basic finance and make good financing decisions
- Prepare you for further Finance courses
Courses and course hours of instruction are subject to change.