BA141
Materials for BA141 Section of Prof. Aliza Racelis

COURSE OUTLINE

1st Semester, AY 2013-14

BA 141 - BUSINESS FINANCE I                                                                Aliza D. Racelis

1st Semester, AY 2013-14                                                                        Business School Rm. 203-E

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COURSE DESCRIPTION

            This course deals with: (1) the techniques of analyzing the firm’s financial information for the purpose of assessing its overall health and identifying problem areas that need to be addressed (these techniques of analysis will be the key ingredients in financial planning and forecasting) and (2) the management of working capital, which is concerned with the day-to day operating activities of the firm.  

COURSE OBJECTIVES

            At the end of the course, the student shall be able to:

1.      Appreciate the relevant characteristics of the economic and financial environment significant to financial management,

2.      Analyze the firm's overall health and past actions, in order to diagnose current and potential problem areas,

3.      Develop skills to undertake proper financial planning and forecasting,

4.      Analyze and resolve issues of enterprise day-to-day decisions (working capital management).

ENTRY REQUIREMENTS:

            This course assumes that the student (1) will be able to read financial statements and related information, (2) has a strong grasp of managerial accounting techniques (BA115), (3) good grasp of macroeconomics, and (4) mathematics of finance (specifically present and future value concepts & techniques).  In addition, familiarity with Microsoft Excel software is desirable.

Text:  

Gitman, Lawrence.  Principles of Managerial Finance, Any edition [10th being the oldest acceptable] (Addison-Wesley).

Grading Plan:            First Exam  ……………………                                        30%

                                    Final Exam ..............................                                         30%

                                    QUIZZES/Exercises ..............................                           10%

                                    Case Discussions   …………….............                          30% 
(A Peer evaluation will be conducted at the end of the semester)

 

Session*                                             Topic                                                  Readings / Assignments

INTRODUCTION TO MANAGERIAL FINANCE

1                                    Course Management

Course Objectives and Course Requirements

                                    Linkage with previous courses

June 12 (Session 2) - HOLIDAY

3                                  Overview of Financial Management;

The Financial Environment                                                                 Chapter 1

 

   I.   FINANCIAL ANALYSIS & PLANNING

 

4-5                               Review:  Financial Statements – Their underlying bases.

Financial Ratio Analysis                                                                      Chapter 2

q  Liquidity, Profitability, Turnover, Leverage,                              

Market ratios and their interrelationships                             

 

6-7                               Cash Flow Analysis                                                                            Chapter 3

q  Analysis and Evaluation of Sources and Uses of Cash

 

8                                  Exercises; Quiz

9-10                               Financial Planning and Forecasting                                                    Chapter 3

q  Pro-forma financial statements, Cash forecasts,                               

Estimating fund requirements.

 

11                                  Financial analysis & Planning: Problem solving                      

12 (July 10)                               Case: 1 ________________________

13 (July 12)                               Case: 2 ________________________

14 (July 17)                               Case: 3 ________________________

15 (July 19)                               Case: 4 ________________________

16 (July 24)                               Case: 5 ________________________

17 (July 26)                               FIRST EXAMINATION                     

 

                                       II.   WORKING CAPITAL MANAGEMENT

 

18 (July 31)                 Working Capital Policy                                                                       Chapter 14

q  Overall framework and basic issues in                        

managing working capital

19 (August 2)                 Talk on "PHILIPPINE STOCK MARKET"
 

20                                Management of Cash and Marketable Securities                              Chapter 14

q  Management of cash flow, determination of cash                   

balances, investment of temporary excess cash

                                                        

21                                Accounts Receivable Management                                                   Chapter 14

q  Analysis of the financial implications of                        

credit policies and collection activities

August 21 (Session 22) - HOLIDAY

*AUGUST 23, 2013 (Session 23): Prof. Aliza Racelis won't hold classes because of UP Conference, here: http://www.aisf.or.jp/sgra-in-english/2013/04/seminar_16.html

HOMEWORK WILL BE ASSIGNED DURING WEEK OF AUG. 21 & 23

24                                Inventory Management                                                                      Chapter 14

q  Analysis of the financial implications of                        

inventory policies

25                                Short-Term Financing                                                                         Chapter 15

q  Identification of sources and analysis of

the terms, costs & risks of short-term financing

26                                Problem solving:  Working Capital Management

27                                Case: 7 ________________________

28                                Case: 8 ________________________

29                                Case: 9 ________________________

30                                Case: 10 ________________________

31                                Case: 11 ________________________

32                                Review

33                                FINAL EXAMINATION

                                                                                                                                                                    

            Grade Scale:

1.00      …         97-100              2.00      …         81-84                3.00      …         65-68

1.25      …         93-96                2.25      …         77-80                4.00      …         61-64

1.50      …         89-92                2.50      …         73-76                5.00      …         60 & below

1.75      …         85-88                2.75      …         69-72

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CLASS POLICIES AND REMINDERS (Dept. of accounting & finance):

 

1.       Mobile phones and other electronic gadgets (including laptops) must be turned off or set to silent mode.  Please refrain from typing text messages while in class. 

 

2.       There will be no make-up quizzes, cases, seatworks, homeworks, and class participation. 

 

3.       There will be no make-up midterm exam.  A student who misses the midterm exam will have a score for the missed exam computed at 75% of his/her final exam score.

 

4.       A student will be given a grade of “Incomplete” if he/she is absent during the final examination or if he/she neglects to submit any of the other course requirements provided that he/she took the midterm exam and his/her class standing is passing.  If his/her absence in the final exam is unjustifiable and his/her class standing is below “3.00”, he/she will get a grade of “5.00” for the course, in accordance with university rules.

 

5.       University rules on absences will be enforced:

a.       Each student is allowed a maximum of 6 absences (excused or unexcused).

b.      One time of tardiness is equivalent to 1/3 absence.

c.       If the majority of the allowable number of absences are unexcused, the student will be given a grade of “5.00” for the course.  If they are excused, the student will be dropped from the subject.

 

6.       Attendance will be checked every meeting at 4:10 pm.  To facilitate the checking of attendance, each student will be assigned a permanent seat for the semester.  Students who come in after the attendance is checked must occupy the seats in the last row.     

 

7.       Learning by doing is the best way to assimilate the concepts in this subject.  Teaching experts say that a student must answer at least 6 exercises on a particular topic to fully grasp it.  While initial analysis of exercises may be done in study groups, each student is encouraged to finally solve the items independently with closed notes and books.  Selected exercises (homework or seatwork) may be required to be submitted.  The exercises required to be submitted may or may not be announced beforehand.  Write all homework on legal-size yellow paper.  For each time that a student is found not doing the homework or seatwork, there will be a corresponding deduction of 2% from the 10% allotted for class participation, seatwork, quizzes, and homework. 

 

8.   Students who participate actively in class, have not been penalized with the 2% deduction mentioned in the preceding number, and have a maximum of one absence will be entitled to an upward adjustment in their final grade by one level.

 

9.   University rule on grade solicitation shall be enforced:

ARTICLE 194: Prohibition against grade solicitation

“No student of the university shall solicit directly or indirectly (ask any person to recommend him to his professor or professors) any grade from an instructor (in his record, examination paper or final report of grades).  Any student violating this rule shall lose credit in the subject or subjects regarding which such (recommendation) solicitation is made (the fact that a student is thus recommended shall be prima facie evidence that the recommendation is made at the request of the student concerned), without prejudice to the filing of a case for disciplinary action.” 

 

10.   Take note of the release of final grades and the period given for any corrections or objections regarding grade recording and/or computations. (These will be announced during the final exam.)  Grades submitted after the lapse of the “objection period” will be final and irrevocable.