Run by Bangor Business School
20 Credits or 10 ECTS Credits
Semester 1 & 2
Organiser: Dr Danial Hemmings
Overall aims and purpose
To examine the concepts and principles underlying key financial decisions. To provide an introduction to corporate finance.
The content may include but will not be limited to; Present value and the opportunity cost of capital; Net present value and alternative methods of investment appraisal; Project analysis; Financial planning, and analysing financial performance; Investment risk and return, and portfolio theory; The Capital Asset Pricing Model; Short-term and long-term financing; Estimating the cost of debt and equity; Weighted average cost of capital; Capital structure, and market imperfections; Dividend policy; Finance for Small and Medium-sized Entities (SMEs).
A- to A*; Comprehensive and creative understanding of concepts and analytical techniques, together with significant evidence of engagement and understanding of wider reading in this area.
D- to D+; Demonstration of basic understanding of key concepts and analytical techniques but with significant mistakes and little development of the subject beyond the lecture material.
B- to B+; Good understanding of key concepts and good analytical skills together with evidence of reading and research beyond the lecture material, but with some minor theoretical or practical errors.
C- to C+
C- to C+; Demonstration of broad and sound understanding of key concepts and analytical techniques, but with significant mistakes and little development of the subject beyond lecture material.
Critically understand the nature and implications of risk and return in corporate finance.
Fully understand the portfolio concept in finance, and implications on corporate financing decisions.
Apply techniques for financial valuation and rules for capital investment.
Critically understand the nature and implications of alternative long-term financing decisions.
Appraise financial performance.
|REPORT||Semester 2 assignment||
1,500 word individual assignment in the form of a report.
|COMPREHENSION TEST||Semester 1 Online Test||
Online test consisting of 13 multiple-choice questions of varying levels of difficulty to be completed in the students' own time. The test is not time-limited but well-prepared students should be able to complete most questions within 10 minutes but other questions require detailed calculations which may take up to 1 hour.
|EXAM||Semester 1 Formal Examination 1.5 hours||
1.5 hour closed-book exam at the end of semester 1.
|EXAM||Semester 2 Formal Examination 1.5 hours||
1.5 hour closed-book exam at the end of semester 2.
Teaching and Learning Strategy
One 2-hour lecture per week.
Private study will include time reviewing lecture materials and recommended reading, completing assignments, and revising for the exam.
- Literacy - Proficiency in reading and writing through a variety of media
- Numeracy - Proficiency in using numbers at appropriate levels of accuracy
- Information retrieval - Able to access different and multiple sources of information
- Argument - Able to put forward, debate and justify an opinion or a course of action, with an individual or in a wider group setting
Subject specific skills
- knowledge of theories and empirical evidence concerning financial management, risk and the operation of capital markets (in cases of degrees with significant finance content).
- Analysis, deduction and induction. Economic reasoning is highly deductive, and logical analysis is applied to assumption-based models. However, inductive reasoning is also important. The development of such analytical skills enhances students' problem-solving and decision-making ability.
- An appreciation of the nature of the contexts in which finance can be seen as operating, including knowledge of the institutional framework necessary for understanding the role, operation and function of markets and financial institutions (e.g. the economic, legal, regulatory and tax environment, both national and international; the firm; the capital markets and the public sector).
- A knowledge of the major theoretical tools and theories of finance, and their relevance and application to theoretical and practical problems (e.g. concept of arbitrage and examples of its use; financial mathematics and capital budgeting criteria; informational efficiency; optimal risk sharing; portfolio theory; asset pricing models and the valuation of securities; cost of capital; derivative pricing; risk management; information asymmetry; principal agency relationships; signalling; Fisher separation and capital budgeting criteria; behavioural finance; term structure and the movement of interest rates; determination of exchange rates and financial intermediation).
- An understanding of the financing arrangements and governance structures of business entities, and an appreciation of how theory and evidence can be combined to assess the effectiveness and efficiency of such arrangements (e.g. decisions as to sources of finance and financial structure; the pricing of corporate securities; the market for corporate control; corporate governance structures and mechanisms; financial planning and international dimensions of finance).
- Numeracy: the use of quantitative skills to manipulate data, evaluate, estimate and model business problems, functions and phenomena.
- Self-management: a readiness to accept responsibility and flexibility, to be resilient, self-starting and appropriately assertive, to plan, organise and manage time.
Same reading list as ASB-2202: http://readinglists.bangor.ac.uk/modules/asb-2202.html
Courses including this module
Compulsory in courses:
- NN44: BSc Accounting and Banking with International Experience year 4 (BSC/ABIE)
- NN43: BSc Accounting and Banking year 3 (BSC/ACCB)
- NN46: BSc Accounting and Banking (4 year with Incorp Found) year 3 (BSC/ACCB1)