Embed Size (px)
Citation preview
BSNS108 Business Finance
COURSE OUTLINE
Semester Two, 2016
BSNS108 Business Finance
Contents Paper Description and Aims .............................................................................................................. 1
Learning Outcomes .......................................................................................................................... 1
Teaching Staff .................................................................................................................................. 2
Course Delivery ................................................................................................................................. 3
Expectations and Workload .............................................................................................................. 4
Course Learning Resources ............................................................................................................... 4
Textbook ....................................................................................................................................... 4
Blackboard .................................................................................................................................... 4
Student Webmail .......................................................................................................................... 5
Assessment ....................................................................................................................................... 5
Course Requirements .................................................................................................................... 5
Quality Assurance ......................................................................................................................... 7
Learning Outcomes....................................................................................................................... 8
Grading System ............................................................................................................................ 8
Dishonest Practice and Plagiarism ................................................................................................ 8
Course Calendar .............................................................................................................................. 10
Student Learning Support and Information ..................................................................................... 11
Student Charter ........................................................................................................................... 11
Guidelines for Learning at Otago ................................................................................................. 11
Student Learning Centre .............................................................................................................. 11
Library Support ............................................................................................................................ 11
Māori Student Support ................................................................................................................ 11
Pacific Islands’ Student Academic Advisor ................................................................................... 11
Disability Information and Support ............................................................................................. 12
Student Feedback ........................................................................................................................... 12
Class Representatives ................................................................................................................. 12
Concerns about the Course ......................................................................................................... 12
Disclaimer ........................................................................................................................................ 13
BSNS108 Business Finance
Page 1
Paper Description and Aims
This course introduces students to business finance with a primary devotion to the
principles of financial valuations. We will first discuss the concept of time value of money in
extensive mathematical detail together with looking at how we can apply these valuation
techniques to real world examples. We then apply these principles to valuing business
projects and financial securities (stocks and bonds).
Since decision-making with investments virtually always involves risk and uncertainty, we
will then introduce the concept of risk, and the relation between risk and return. This is
followed by a discussion of the relation between cost of financing and weighted average
cost of capital. We will then integrate our knowledge of cash flows with our understanding
of risk and financing cost to take a decision from a valuation outcome. We close the course
looking at the relevance of capital structure and dividend policy in corporate performance.
Learning Outcomes
Upon successful completion of this paper, you should be able to understand the business
environment through the different forms of business that exist, understand and solve
problems related to the time value of money, give rough estimates of the values of shares
and bonds, have an understanding of ethical issues associated with the handling of money,
critically analyze investment decisions, apply risk and return models to businesses in
practice, and understand how financial decision making contributes to business knowledge.
BSNS108 Business Finance
Page 2
Teaching Staff
Paper Coordinator Name: Mrs. Christine Smith-Han Office: CO5.45 Email: [email protected] Office Hours: Mon: 1 to 2pm, Tues and Wed: 2 to 3pm, or by appointment Head Tutor Name: Dr. Olena Onishchenko Office: CO5.45 Email: [email protected] Office Hours: Tues: 11am to 1pm Email clearance: Tues: 1 to 2pm
Contacting Staff: Content, Blackboard or extenuating circumstances: If you have questions about the material you should;
(1) Discuss it with tutors
(2) See the lecturer during office hours or talk to them just after lectures.
(3) Email queries to Christine or Olena
For matters relating to extenuating circumstances please email Christine Smith-Han. Emails are
cleared during work hours only and you should anticipate an acknowledgement or response no later
than two working days from when you first posted your email query. If you don’t get a response
within the given time-frame, please send another email to follow up.
BSNS108 Business Finance
Page 3
Course Delivery
Every week students must attend three 50 minute lectures and one 50 minute tutorial each week
Lectures
Lectures present the key conceptual material through discussion and interaction between teaching
staff and students. Lectures are supported by readings.
Lecture times and locations are;
Tuesday 13:00 – 13:50 STDAV
Wednesday 10:00 – 10:50 STDAV
Thursday 14:00–14:50 STDAV
Tutorials
Tutorials are interactive, collaborative sessions in which students attempt to cement concepts
presented at lectures with their peers in a supportive environment. Tutorials offer you the
opportunity to work in groups on a series of tasks designed to apply the concepts that you have
been exposed to in class and from your reading, and to stimulate your interest in the course as it
applies to “everyday” issues. The key feature of tutorials, as opposed to lectures and individual
study, is participation of all members of the tutorial group. Please attempt the tutorial questions
before going to the actual tutorial sessions.
Tutorials begin in the second week of semester. You will be allocated a tutorial session and this information will be available in e-Vision. If you require a tutorial stream change due to clashes or late enrollment after formal Course Approval, you can do this in the first two weeks of the semester. The last date for tutorial stream changes is 8th of March 2016. Follow this instruction to action a tutorial change: Please go and see Zac Mitchell-Beatson in CO 5.51 at the Accountancy & Finance Department, 5th Floor Commerce Building, from Wednesday 13th July to Thursday 21st July, between 2 to 4 pm to process streaming changes.
Course Calendar
The course calendar (See page 10) details scheduling information. Note that this calendar may
change as the course proceeds. Any changes will be announced at lectures and be detailed on
Blackboard.
Students are expected to prepare for and attend all classes to gain full benefit from the course
These activities should be prepared for by reviewing information detailed on Blackboard and
completing any assigned readings. Students unable to attend a lecture are expected to catch up on
missed material. Unless stated otherwise, all aspects of the course are examinable.
BSNS108 Business Finance
Page 4
Expectations and Workload
The following note is copied from the University of Otago website: http://www.otago.ac.nz/study/planning/workload.html
“A full-time first year course is generally between 54-72 points in any one semester or 108-144 points in any one year. As an approximate guide, you can expect to spend about two hours per week per 3 points for single-semester papers. These hours are made up of a combination of lectures, tutorials, laboratories, assignments and reading.”
Thus, for an 18-point paper (like BSNS 108), you can budget 12 hours per week on average. That is eight hours of study outside the classroom per week (the less you do, the less likely it is that you pass). Some topics may require more study; some may require less. We estimate that each lecture you fail to attend reduces your maximum possible score on the final exam by maybe 4%, and each lecture you fail to attend in the first five weeks reduces your maximum possible score on the midterm exam by maybe 6%. So, come to class and take handwritten notes. If you miss a lecture, you are advised to get the lecture notes from another student in the class.
Course Learning Resources
Textbook
Essentials of Corporate Finance 3rd Edition, by Stephen Ross, Rowan Trayler, Ron Bird, Randolph Westerfield, Bradford Jordan, ISBN: 9780071013185 (2013) The textbook is required. Tutorial problems come from the third edition of the text. Either of the first or second edition (ISBN 007028497 [2011] or ISBN 0074716700 [2008]) are just fine for studying for the course, but the tutorial problems covered by tutors come from the third edition. We will post electronic copies of these on Blackboard. You should read the relevant chapter(s) before you come to class. This will greatly improve your understanding.
Blackboard
Blackboard https://blackboard.otago.ac.nz/ provides you with access to course materials, class notices, and additional study resources. Blackboard is used to email the whole class so it is important that you check your student email and Blackboard regularly.
BSNS108 Business Finance
Page 5
Student Webmail
IMPORTANT - DO THIS NOW: Forward your University email address to an email address that you use regularly as follows:
1. Log into your StudentMail account using your student username and password 2. Click Cog button (top right corner) > Options 3. Under Account, select the Forward your email shortcut under the Short Cuts menu on the
right side of the screen. 4. Under the Forwarding heading, type in the email address you want your email to be forwarded
to. You can also choose to have a copy of these emails kept on your StudentMail account, so please check the box if you would like this.
5. Click the Start forwarding button.
Assessment
All materials presented are examinable (except where stated otherwise). As noted in the table below, there are four quizzes, one midterm exam, and one final exam.
* Quizzes account for 10% of the overall grade; calculated from your best three out of four quiz results1.
Course Requirements
Quizzes
Quizzes are held in four of the 13 weeks (see the class schedule for dates and topics).
Use a compatible browser: (see https://Blackboard.otago.ac.nz/ for advice).
Each quiz is accessed online using Blackboard between 8am Wednesday of the relevant week and 5pm Tuesday of the following week.
There is a practice quiz available for access from Monday 8am to the following Tuesday 3pm that goes with the actual quiz on the relevant week the actual quiz is scheduled to run.
Quizzes appear under the Assessments tab on Blackboard.
Each actual quiz lasts 40 minutes (but you can finish early) and you get only one attempt.
1 Formula= (1/3)*[(Q1+Q2+Q3+Q4)-min(Q1,Q2,Q3,Q4)]*(10%)
Assessment Week Weight
Quiz 1 (out of 10 points) Week 3 2.5%*
Quiz 2 (out of 10 points) Week 6 2.5%*
Midterm Exam Week 7 35.0%
Quiz 3 (out of 10 points) Week 10 2.5%*
Quiz 4 (out of 10 points) Week 12 2.5%*
Final Exam Exam Period 55.0%
Total 100.0%
BSNS108 Business Finance
Page 6
Do not leave it until the last minute! The quiz link disappears after 5pm Tuesday of the following week.
Note that Blackboard (or your computer) can sometimes experience technical difficulties or hang-ups that require the instructor to reboot your quiz login and enable you to re-sit the quiz. Email [email protected] or [email protected] to request for a reboot if you find yourself in this situation.
To reduce the chance of technical difficulties, make sure you are freshly logged in, use a compatible browser (as indicated at the BlackBoard login page), don't click the back button on your browser, and complete the quiz within the time limit by clicking on “save and submit” before the 40 minutes are up.
Although the quiz is live from Wednesday 8am to 5pm in the next following Tuesday week, we will not action any requests to reboot your quiz if you choose to sit the quiz on after-midday Tuesday (last day of the Quiz). So, aim to sit the quiz ahead of Tuesday when the quiz is scheduled to finish, and recognize that if you leave to sitting the quiz on the last day after Tuesday 12pm, and if the system hangs up on you, you will not get a second chance.
Be sure to have your formula sheet, course materials and class notes with you when you take the online quizzes.
Your quiz answers must be your own work; you are not allowed to receive any help from another person in answering quiz questions (that would be cheating and a clear violation of the University Ethical Policy Guidelines).
Midterm (Thursday 25 August, 7 to 9pm)
The midterm exam is a closed book two-hour multi-choice exam held outside regular class time. If your final score is higher than your midterm results, then you will be granted plussage. This means that the numerical grade on your final exam will replace the numerical grade on your midterm exam.
If you are ill for the final exam, and you apply to the Examinations Office for special consideration, we may look to your midterm exam to help choose your grade. So, the bottom line is that you should aim to do as well as possible on the midterm exam.
****There is a TERMS REQUIREMENT for BSNS 108: you must score 30% or higher on the midterm exam. If you fail terms then you cannot sit the final exam and you fail the course. ****
Note:
Your BSNS108 midterm grade will be released on Blackboard ideally no later than one week after the date of the midterm exam.
If you were impaired (mentally, physically or emotionally) for the midterm test, then before your grades get released you must present a medical certificate properly dated to cover the day of the exam. In line with university policy on special consideration, no student will be granted special consideration (e.g., a terms waiver) if they submit a medical certificate after the release of their mid semester grades.
BSNS108 Business Finance
Page 7
Final grade
Assuming that you pass terms and sit the final exam, we have to assess whether you pass the course or not. To pass BSNS 108 you must
score 30% or higher on the midterm; AND
score 50% or higher when we calculate your overall weighted score including your quizzes in accordance with the Assessment table.
All material presented is examinable (unless stated otherwise) by quizzes, the midterm and the final examination. All important assessment information such as due dates and times, content, guidelines and so on will be discussed in lectures and, where appropriate, detailed on Blackboard in the week prior to each assessment. Students are responsible for ensuring that they are aware of this information, keeping track of their own progress, and catching up on any missed classes.
Note two University final examination rules students often claim to not know about (http://www.otago.ac.nz/study/exams/otago029434.html):
If you are impaired (mentally, physically, emotionally) for your final exam, then an application for special consideration must be received by the Chief Supervisor of Examinations within five calendar days of the candidate's last examination for which Special Consideration is being requested.
No candidate shall communicate with an examiner in regard to an examination either in the examination script or otherwise before the release of confirmed results, except through the Manager, Student Administration. So, you must not write “finalist” (or any other message) on your exam script, or send an email to your instructor before your results are released.
Quality Assurance
At the Otago Business School we monitor the quality of student learning and your learning experience. Your assessed work may be used for assurance of learning processes, such as evaluating the level of achievement of learning outcomes, with the aim of improving the quality of our programmes. All material used for quality assurance purposes will be treated as confidential and the outcome will not affect your grades.
BSNS108 Business Finance
Page 8
Learning Outcomes
Learning Outcome (subject to change)
Qu
iz 1
Qu
iz 2
Qu
iz 3
Qu
iz 4
Mid
term E
xam
Final E
xam
To
tal
Understand the business environment through the different forms of business.
Understand and solve problems related to the time value of money.
Calculate the price of shares and bonds.
Gain an understanding of the ethical issues associated with the handling of money.
Critically analyze business investment decisions.
Apply risk and return models to businesses in practice
Understand how financial decision making contributes to business knowledge.
Total 2.5%* 2.5%* 2.5%* 2.5%* 35% 55% 100%
* Quizzes account for 10% of the overall grade; calculated from your best three out of four quiz results2.
Grading System
The grading scheme used at Otago is:
A+ 90-100 C+ 60-64 A 85-89 C 55-59 A- 80-84 C- 50-54 B+ 75-79 D 40-49 B 70-74 E <40 B- 65-69
Dishonest Practice and Plagiarism
Students should ensure that all submitted work is their own. Plagiarism is a form of dishonest
practice (cheating). It is defined as copying or paraphrasing another’s work and presenting it as
one’s own. Any student found responsible for dishonest practice in any piece of work submitted for
2 Formula= (1/3)*[(Q1+Q2+Q3+Q4)-min(Q1,Q2,Q3,Q4)]*(10%)
BSNS108 Business Finance
Page 9
assessment shall be subject to the University’s dishonest practice regulations, which may result in
serious penalties, including forfeiture of marks for the piece of work submitted, a zero grade for the
paper, or in extreme cases, exclusion from the University. The University of Otago reserves the
right to use plagiarism detection tools.
Students are advised to inform themselves about University policies concerning dishonest practice
and take up opportunities to improve their academic and information literacy. If necessary, seek
advice from academic staff, or the Student Learning Centre. The guideline for students is available
at this link: http://www.otago.ac.nz/study/academicintegrity/index.html
BSNS108 Business Finance
Page 10
Course Calendar All information in this draft is subject to change.
Week Date Topic Chapters Tutorial Assessment
12/07/2016 Intro to Finance
13/07/2016 Forms of Business
14/07/2016 Corporations and Financial Markets
19/07/2016
20/07/2016
21/07/2016
26/07/2016 QUIZ 1
27/07/2016 INTRO &
28/07/2016 TVM 1
2/08/2016
3/08/2016 No
4/08/2016
9/08/2016
10/08/2016 No
11/08/2016
16/08/2016 QUIZ 2
17/08/2016 TVM 2 &
18/08/2016 Bonds
23/08/2016
24/08/2016 Ethics No
25/08/2016 Capital Budgeting 2: FCF Estimation 9
30/08/2016
31/08/2016
1/09/2016
6/09/2016
7/09/2016
8/09/2016
13/09/2016
14/09/2016
15/09/2016
20/09/2016
21/09/2016
22/09/2016
27/09/2016
28/09/2016 No
29/09/2016
4/10/2016 CAPM, QUIZ 4
5/10/2016 Cost of History, Risk
6/10/2016 Capital & Return
11/10/2016
12/10/2016 Review
13/10/2016
1 1 None No
2Time Value of Money (TVM) 1:
Single Cash Flow4
Intro +
TVM 1No
3 Time Value of Money (TVM) 2:
Multiple Cash Flows5
TVM 1
4 TVM 2
Bonds and Interest Rates 6
5 Bonds
Shares and Equity Valuation 7
6Bonds and
EquitiesCapital Budgeting 1:
Decision Criteria Rules
8
7Equities and
Midterm
Review
Midterm Test
Thur 25 August
Mid-semester Break
8Capital Budgeting 2:
Free Cash Flows Estimation9
Decision
CriteriaNo
9 Investment Market History 10
Free Cash
Flow
Estimation
No
10 Risk & Return 11
Investment
Market
History
QUIZ 3
Decision Criteria/
FCF Estimation
13 Review
11Risk &
ReturnCapital Budgeting 3: Cost of Capital 12
12 Capital Structure & Dividend Policy 13, 14
BSNS108 Business Finance
Page 11
Student Learning Support and Information
Student Charter
http://www.otago.ac.nz/about/otago005275.html
Guidelines for Learning at Otago
http://hedc.otago.ac.nz/hedc/wp-content/uploads/2012/12/Guidelines-for-Learning.pdf http://hedc.otago.ac.nz/hedc/learning/
Student Learning Centre
The Student Learning Centre, which is part of the Higher Education Development Centre, provides
learning support, free of charge, to ALL enrolled students. Their services include:
a workshop programme designed to help students to improve their learning strategies and their
generic skills;
individual assistance with learning issues;
on-line study skills advice;
a student leadership programme
a student-led peer support programme for students of all ages and backgrounds.
conversational English groups for students from a non-English speaking background
The Centre also provides two very helpful study guides, “Guidelines for Writing and Editing” and “Writing University Assignments” and these are available on the SLC website. http://slc.otago.ac.nz/
Library Support
The Library website http://www.otago.ac.nz/library provides access to resources and services, including group room bookings, library hours and locations, past exam papers, subject guides, article databases and more. If you need assistance either check out the self-help guides http://otago.libguides.com/selfhelp, or ask Library staff at the ground floor service desks, or email [email protected]
Māori Student Support
Tënā koutou katoa, Ko Corey Bragg töku ingoa Ko Ngāi Tahu, Kāti Mamoe, Waitaha me Ngāti Kahungunu öku iwi Kia ora, my name is Corey Bragg and I am the Māori student support person in the Business School. My role is to help link Māori students with the various support networks throughout the university and the community. Kaua e whakamā, don't be shy - come in for a chat. Mauri ora mai. Tel 479 5342 Email [email protected] Room CO 3.21
Pacific Islands’ Student Academic Advisor
Warm Pacific Greetings Talofa lava, my name is Esmay Eteuati and my role is to liaise with Academic Departments and Student Services relating to Pacific students’ and their course of study. I support both staff and
BSNS108 Business Finance
Page 12
students in the Business School and have a network of Pacific contacts in other Divisions around the University. Tel +64 3 479 4756 Email: [email protected]
Disability Information and Support
Students are encouraged to seek support if they are having difficulty with their studies due to disability, temporary or permanent impairment, injury or chronic illness. It is important to seek help early, through one of the contacts below: (INSERT DEPARTMENTAL CONTACTS)
Student Feedback
We encourage your feedback. This can be in the form of contacting staff, participating in course
evaluation surveys and communicating with class representatives. Continual improvements will be
made to this course based in part on student feedback. Recent changes to this course as a result of
constructive feedback include (insert summary of improvements)
Class Representatives
The class (or student) representative system is an avenue for encouraging communication and
consultation between staff and students. It provides you with a vehicle for communicating your
views on the teaching and delivery of the paper and provides staff with an opportunity to
communicate information and gain constructive feedback from students. It contributes to the
development of a sense of community within a department and it adds a further dimension to the
range of support services offered to students.
Volunteers for the role of class representatives will be called early in the semester. The OUSA
invites all class representatives to a training session, conducted by OUSA, about what it means to
be a class representative and some of the possible procedures for dealing with issues that arise.
They also provide information on the services that OUSA offers and the role OUSA can play in
solving problems that may occur. The OUSA provides support to class representatives during the
semester. Departmental staff will also meet with class representatives during the semester to
discuss general issues or matters they wish to have considered.
Your class representative’s name and contact details will be posted on Blackboard early in the
semester.
Concerns about the Course
We hope you will feel comfortable coming to talk to us if you have a concern about the course. The
Course Co-ordinator will be happy to discuss any concerns you may have. Alternatively, you can
report your concerns to the Class Representative who will follow up with departmental staff. If,
after making approaches via these channels, you do not feel that your concerns have been
addressed, there are University channels that may aid resolution. For further advice or more
information on these, contact the departmental administrator or head of department.
BSNS108 Business Finance
Page 13
Disclaimer
While every effort is made to ensure that the information contained in this document is accurate, it
is subject to change. Changes will be notified in class and via Blackboard. Students are encouraged
to check Blackboard regularly. It is the student’s responsibility to be informed.
