FIN701 FINANCE & ACCOUNTING

Subject Outline

Overview:

Unit Code: FIN701

Subject Title: FINANCE

Section: FIN701-2209-1

Credit Points: Four (4)

Prerequisites: NIL

Lecturer: Dr Sabam Hutajulu

Phone: +62 81517106246

Email: sabam.hutajulu@campus.globalnxt.edu.my

Programme Executive: Pushan Chakraborty (+91 9062013239)

Email: studentcare@globalnxt.edu.my

Subject Details:

Subject Description:
This subject introduces students to the finance function in an organisation. The subject examines the
three strategic decisions of finance: what to invest in, how to finance the investment and how to manage
the risk associated with the investment. Investment decisions are those in which organisations commit
resources. Students learn various methods of valuation which enable them to determine appropriate
means of financing investments. Risk management, including how to manage exposure to risk and
unexpected changes in the value of investments, is also covered.

Aims:
The aim of the subject is to introduce students to the finance function in an organisation.

Objectives:
The objective of the subject is to enable students to apply financial theory to a variety of managerial
decision-making situations. Businesses prosper financially by making good business decisions. These
decisions take a balanced, holistic view of the entire company and incorporate the goals and values of
each functional area.

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 Learning Outcomes for the Subject:
Upon completion of this subject, students should be able to:
• Identify the purpose of financial statements and the interrelationships among each of them
• Apply the CAPM to value investment project(s) using capital budgeting techniques
• Apply capital structure theory to enhance the value of the firm with appreciation for the link
between capital structure and the cost of capital
• Determine the value of the firm by applying dividend discount models and explain the relation
between dividend policy and firm value

Teaching and Learning Strategies:

The teaching and learning strategy is based on a constructivist approach building on the students
existing knowledge and experience. Students are exposed to an authentic learning environment
gaining experience in solving the same kind of problems that they would encounter in their work
environments. Peer assisted learning is encouraged through the use of online discussion boards where
student can share their own work experiences and views.

Mode of Delivery:
The mode of delivery for this module is online with self-study of course materials, discussion board
activities and case studies. The online study is also supplemented with synchronous face-to-face
sessions.

Study Schedule

Week Week Commencing Segment Topics References / Readings

1 13 January, 2023 Introduction

Interrelationship between Accounting &
2 16 January, 2023 Segment 1
Finance
The Balance of Business
3 23 January, 2023 The Cashflow View Segment 2
Time Value of Money
Valuation of Securities
4 30 January, 2023 Segment 2
Valuation and Capital Budgeting
Portfolio Theory and CAPM
5 6 February, 2023 Segment 3
Risk and Return
6 13 February, 2023 Weighted Average Cost of Capital Segment 3
7 20 February, 2023 Market Efficiency Segment 4
8 27 February, 2023 Long Term Financing Segment 4
9 6 March, 2023 Capital Structure Decision Segment 5
10 13 March, 2023 Dividend Decision Segment 5
Exchange Rates
11 20 March, 2023 Segment 6
Interest Rate Parity
Purchasing Power Parity
12 27 March, 2023 Segment 6
Exchange Rate Determination
13 3 April, 2023 Exchange Rate Determination Segment 6
14 10 April, 2023 International Capital Budgeting Segment 6

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Webinar sessions (compulsory)
Date and Time Webinar Title
(2 PM Group 1 and 4 PM
Session Webinar link
Group 2 all Malaysian
Time)
1 21 January 2023 Introduction
2 4 February 2023 Segment 2 Click here to join the meeting
3 18 February 2023 Segment 3
4 4 March 2023 Segment 4
5 18 March 2023 Segment 5 Meeting ID: 486 653 817 388
6 1 April 2023 Segment 6 Passcode: ZGeLCD
7 8 April 2023 Revision

Summary of Assessment
Item Title Due Date Weight Type
1 Discussion Board Topics Weeks 2 to 4 5-Feb-23 15% Individual
2 Action Learning Project (Weeks 5 to 7) 26-Feb-23 15% Group
3 Discussion Board Topics Weeks 8 to 10 19-Mar-23 15% Individual
4 Final Integrated Project (Weeks 11 to 13) 9-Apr-23 15% Group
5 Final Examination To be confirmed by the 40% Individual
Examinations Office
TOTAL 100%

Assessment Details:

Assessment Item 1:
Title: Discussion Board Topics Weeks 2 to 4
Group or Individual: Individual
How Students will be Assessed: As per the Discussion Board Rubric on the LMS
Details:
Take up the financials of a company from the web and draw conclusions about the efficiency of the
company's financial management team. You are free to take up more than one company for your
analysis.
You are also expected to read peer postings and comment on them as appropriate. The goal of such
interaction is to encourage peer learning.

Assessment Item 2:
Title: Action Learning Project
Length: 12 slides
Group or Individual: Group
Description:
How Students will be Assessed: As per the Grading Criteria Sheet on the LMS
Details:
For the Action Learning Project, you need to follow the steps outline below:

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 Assessment Details:

• Select a company which publishes its financial statements in the public domain (such as its
own website).
• Access the latest publicly available annual financial statements of the business.
• List four observations about the performance of the company that reflect its significant
achievements during the period covered by the financial statements, including major
challenges that the company is currently facing or is likely to face in the future.
• Compute the annual free cash flow for the latest two years using the information provided in
the appropriate financial statement.
• Forecast the free cash flow for the next three years, based on the information provided in the
financial statements as well as recent information available about the company in the media.
State all your assumptions used in this forecasting process, clearly.

Assessment Item 3:
Title: Discussion Board Topics Weeks 8 to 10
Group or Individual: Individual
How Students will be Assessed: As per the Discussion Board Rubric on the LMS
Details:
1. Discuss the main features of Capital Asset Pricing Model (CAPM) and comment on the validity
of the model in the real world with examples.

2. Reflective Summary of discussions during Week 8-10

For your reflective summary posting of week 8-10, post the following to the discussion board:
• A summary of the discussion that took place during week 8-10
• Identify and highlight the key discussion board contributions You made during those 3
weeks
• Nominate two other postings (from other students) that you felt were particularly helpful
or insightful and tell us why.

Assessment Item 4:
Title: Final Integrated Project
Length: 12 slides
Group or Individual: Group
Description:
How Students will be Assessed: As per the Grading Criteria Sheet on the LMS
Details:
This assignment involves reading a case and then creating a presentation to address the issues in it.
The case concerns decision making about an expansion project.

Title: Diamond Energy Resources

Author(s): Lena Chua Booth
Case No: #TB0435-PDF-ENG; Date: Jan 01, 2016
Publisher: Harvard Business School Publishing

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 Assessment Details:

Instructions:
Create a presentation having no more than 12 slides to build your arguments, recommending Agus on
whether to invest or not in the new project.

Assessment Item 5:
Title: Final Examination
Duration: Three (3) hours
Group or Individual: Individual

Reference Material:

Recommended Textbook:
Brealey, R., Myers, S., Allen, F. (2016), “Principles of Corporate Finance”, McGraw-Hill.

Additional Reference Books:

Ross, S.A., Westerfield, R.W. (2012). Corporate Finance (10th ed.). New York. McGraw Hill-Irwin.

Berk, J., DeMarzo, P. (2013), “Corporate Finance”, 3rd Edition, Prentice Hall.

eBooks:
Bierman, H 2010, An Introduction To Accounting And Managerial Finance: A Merger Of
Equals, Singapore: World Scientific Publishing Company, eBook Academic Collection.

McCrary, SA 2010, Mastering Corporate Finance Essentials: The Critical Quantitative Methods
and Tools in Finance, Hoboken, N.J.: John Wiley & Sons, Ebrary Academic Complete.

Fabozzi, F, & Peterson Drake, P 2009, Finance: Capital Markets, Financial Management, And
Investment Management, Hoboken, N.J.: Wiley, eBook Academic Collection.

Baker, HK 2011, Capital Budgeting Valuation: Financial Analysis for Today’s Investment
Projects, Hoboken, N.J.: John Wiley & Sons, Ebrary Academic Complete.

Shim, J, & Siegel, J 2009, Budgeting Basics And Beyond, Hoboken, N.J.: Wiley, eBook
Academic Collection.

Dayanada, D 2002, Capital Budgeting: Financial Appraisal Of Investment Projects,

Cambridge, UK: Cambridge University Press, eBook Academic Collection.

Riahi-Belkaoui, A 2001, Evaluating Capital Projects, Westport, Conn: Greenwood Publishing

Group, eBook Academic Collection.

Duffie, D 2012, Dark Markets: Asset Pricing And Information Transmission In Over-The-Counter
Markets, Princeton: Princeton University Press, eBook Academic Collection.

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 Reference Material:

Slee, RT 2011, Private Capital Markets: Valuation, Capitalization, And Transfer Of Private
Business Interests, Hoboken, N.J.: Wiley, eBook Academic Collection.

Allman, KA 2010, Corporate Valuation Modeling: A Step-By-Step Guide, Hoboken, N.J.: Wiley,
eBook Academic Collection.

Thomas, R, & Gup, B 2010, The Valuation Handbook: Valuation Techniques From Today’s Top
Practitioners, Hoboken, N.J.: Wiley, eBook Academic Collection.

Reinert, KA, Rajan, RS, & Glass, AJ 2008, Princeton Encyclopedia of the World Economy,
Volumes 1-2, New Jersey: Princeton University Press, Ebrary Academic Complete.

Weithers, TM 2006, Foreign Exchange: A Practical Guide To The FX Markets, Hoboken, N.J.:
Wiley, eBook Academic Collection.

Subject Outline Updated: 10 January, 2023

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