Content, progress and pedagogy of the module

The purpose of the course is to provide the student with a basic introduction to finance, including the discussion of various financial issues that may arise in a company. The course will introduce students to the main areas of finance and financial markets, explain the structure and uses of financial statements and cash flow analysis, explore the concepts of effective interest rates, time value of money, discounting and compounding, and demonstrate how these concepts can be used to value bonds, stocks and investment projects.

The following major subject areas are included in the teaching:

• Overview of finance, financial markets, and financial management.
• Balance sheet, income statement and cash flow.
• Interest rates, compounding and discounting.
• Loans, annuities, and perpetuities
• Bonds and bond yields
• Stock valuation models
• Net present value and other investment criteria.

Learning objectives

Knowledge

The objective is that the student after the module possesses the necessary knowledge on:

• the fundamental concepts of financial management, financial markets and financial statements.
• the concept of time value of money, and the importance of interest rates.
• the approaches to valuing loans, bonds, and stocks.
• most common investment valuation criteria.

Skills

The objective is that the student after the module possesses the necessary skills in:

• Reflect on and interpret financial statements of a firm.
• Identify and apply relevant approaches to analysis and valuation of main debt and equity market instruments.
• Apply the theoretical framework to quantifying investment attractiveness of projects.
• Analyze and evaluate the valuation results, discuss their uses and limitations.

Competences

The objective is that the student after the module possesses the necessary competences in:

• using arguments and evidence; demonstrating numerical/quantitative skills; developing a framework and providing a set of analytical tools for decision making based on financial theories and the best industry practices.
• arguing on a scientific basis about the merits and demerits of, as well as alternatives to, various analytical frameworks and techniques used for financial management in business.
• using the fundamental financial theories as a framework for real world business analysis.
• Disseminating knowledge and contributing to the discussion of concrete financial issues in a company.

Type of instruction

• Lectures
• Exercises

Extent and expected workload

• 135 hours

Exam

Exams