Business Finance

The American Business School Paris

Course Description

  • Course Name

    Business Finance

  • Host University

    The American Business School Paris

  • Location

    Paris, France

  • Area of Study

    Finance

  • Language Level

    Taught In English

  • Prerequisites

    ACCT 111

  • Course Level Recommendations

    Lower

    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.

    Hours & Credits

  • US Credits

    3
  • Recommended U.S. Semester Credits
    3
  • Recommended U.S. Quarter Units
    4
  • Overview

    COURSE 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:
    • 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
    Presence in class is mandatory. Bring your book to class. More than 2 absences leads to a failing grade
     
    EXPECTED LEARNING OUTCOMES:
    After this course you will be able to:
    1) Define key factors associated with investing decision
    2) Evaluate project by Calculating Net present value. Understand basic Financial Theory
    3) Define the key concepts associated with financing decisions
    4) Explain securities as sources of finance and how firms issue securities
    5) 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 customer
     
    EVALUATIONS:
    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 1
    1. Kick-off. Sustainable development and finance and revision of basic math and accounting needed for course.
    2. Ch 1 Goal and Governance of the Firm
    Ch 2 Financial Markets and Institutions
     
    Session 2
    1. Ch 3 accounting and Finance
    Interpret 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 performance
     
    Session 3
    1. Ch 5 Time value of Money
    Understand the present value of future payments
    Compare interest rates quoted over different intervals
    2. Ch 8 Net present value and other investment criteria, calculate NPV, internal rate of return (IRR), pay pack
     
    Session 4
    3. Ch 9 Project analysis, using discounted cash flow analysis to make investment decisions Capital investment, Operating cash flow: change in working capital
    4. Ch 10 Project analysis, Practical problems and capital budgeting
    Use sensitivity analysis and break-even analysis
     
    Session 5
    1. Ch 11 Introduction to risk and return and the opportunity cost of capital, Estimate the project cost of capital, market risk vs company specific risk
    2. Revision for midterm
     
    Session 6
    Midterm exam on chapters 1-5, 8-11,(2 hours)
     
    Session 7
    1. Ch 13 The weighted cost of capital ( WACC)
    2. Ch 14 Introduction to Corporate Financing
     
    Session 8
    1. Ch 15 Venture capital, IPO and seasoned offering
    2. Ch 16 Debt Policy, Perfect capital markets and capital structure, Tax effect of debt policy, financial distress effects on debt policy
     
    Session 9
    1. Ch 17 Payout policy
    2. Ethics, finance and history of Financial crisis, Cases, Enron, WorldCom and Tyco, 3 types of Financial scandals, A review of major financial crisis
     
    Session 10
    1. 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 planning
    Construct source and uses of cash and evaluate the need for financing
     
    Session 11
    Ch 20 Working Capital, understand the cash implication of working capital, decide whether it make sense to give credit to customer
     
    Session 12
    Revision for final exam.
     

Course Disclaimer

Courses and course hours of instruction are subject to change.

Eligibility for courses may be subject to a placement exam and/or pre-requisites.

Credits earned vary according to the policies of the students' home institutions. According to ISA policy and possible visa requirements, students must maintain full-time enrollment status, as determined by their home institutions, for the duration of the program.

Please note that some courses with locals have recommended prerequisite courses. It is the student's responsibility to consult any recommended prerequisites prior to enrolling in their course.