INBU 4200 -- INTERNATIONAL FINANCIAL MANAGEMENTSUMMER (A TERM) 2009 – LEEDS SCHOOL OF BUSINESS

M-F, 9:15 – 10:50; KOBL 255

Professor Michael PalmerOffice: KOBL S419Office Phone: (303) 492-4241E-Mail: Michael.Palmer@Colorado.EDUHome Page: http://leeds-faculty.colorado.edu/palmerm/

COURSE DESCRIPTION:

INBU 4200 (International Financial Management) will explore many of the financial issues confronting managers of today’s global firms. The course will focus on the unique “international” financial environments and associated risks that confront global firms and the strategies managers use for dealing with these environments and risks. The course will also monitor current events in the area of international financial markets through various web sites and the financial press.

COURSE TOPICS:

Globalization Process and Relationship to the International Finance FunctionThe globalization of consumption, production and finance (including financial markets)The implications of financial market globalization

The International Financial EnvironmentInternational Financial MarketsForeign exchange markets and foreign exchange quotesThe International Monetary System (Gold Standard to post Bretton Woods)Corporate objectives and corporate governance in a global setting (cultural impacts)

Foreign Exchange Rate DeterminationFactors influencing exchange rates Asset choice modelsLong term parity modelsGovernment influence and intervention/management

Foreign Exchange Exposure: Risk, Measurement and ManagementThe types of foreign exchange exposure facing firms and resulting risk for these firmsForeign exchange (exposure) risk management techniquesUsing financial market contracts to manage foreign exchange exposure: forward

contracts, future contracts, money market hedges, and options contractsOperational strategies for dealing with foreign exchange exposure

Asset and Liability Management for Global CompaniesExporting, Importing, and LicensingForeign Direct Investment (FDI)Wholly owned subsidiaries and Joint VenturesCross Border Mergers and Acquisitions

Capital structure issuesCountry differences in capital structures (i.e., the use of debt and equity)Cost of capital implications for the global firm

REQUIRED TEXT:

International Financial Management, by Jeff Madura, South Western, Abridged 9TH edition, 2009

RECOMMENDED READINGS, THE FINANCIAL PRESS:

It is recommended that you read the Wall Street Journal and link to Bloomberg.com on a regular basis as both will keep you current.

OFFICE INFORMATION:

Office: KOBL S419   Phone:  303-492-4241 (please leave voice message if I’m not there)E-Mail: michael.palmer@colorado.edu Office hours: Immediately after class by appointment

WEEKLY TEXT ASSIGNMENTS AND TOPICS:

Week Chapter Assignments and Topics By Week

1 Text Chapters: Part 1; 1 – 5The International Financial Environment

2 Text Chapters: Part 2; 6 – 8Exchange Rate Behavior

3 Text Chapters: Part 3; 9 – 12Exchange Rate Risk Management

4 Text Chapters: Part 4; 13 – 18 (Note 15, 17, and 18 available on line)Long Term Asset and Liability Management

5 Text Chapters: Part 5; 19 – 21 (Note: 19, 20 and 21 available on line)Short Term Asset and Liability Management

COURSE GRADING COMPONENTS

1. Four weekly tests (covering lecture, emails and book material) (Given the end of weeks 1, 2, 3, and 5) 40%

2. Major short answer exam (end of week 4) 35%3. Weekly group presentation from assigned topic

(Beginning of weeks 2, 3, 4 and 5) 20%4. Attendance (attendance will be taken daily with a sign in attendance sheet) 5%

COURSE GRADES:

A = 90% B = 80% C = 70% D = 60%

ATTENDANCE FOR THIS CLASS AND NAME CARDS:

My expectation is that you do not leave the classroom in the middle of a lecture. Please prepare yourself for this. Given the length of daily classes, I will generally give the class a short break in the middle of each lecture. In addition, all students will be provided with name cards during the first week of class. Please be responsible for these name cards and bring them to class with you on a daily basis.

ASSIGNED READINGS:

Throughout the A term, articles will be emailed to you or posted on my University of Colorado home page under this course. I will normally announce these shortly after emailing or posting (generally the day of), but please be aware that you are responsible for checking your emails and my course home page on a regular basis to see if new material has been emailed to you or posted.

HOME PAGE LECTURE NOTES AND ASSIGNED READINGS:

Power point lecture slides and posted readings can be linked through my home page:http://leeds-faculty.colorado.edu/palmerm/

Link to “Current Courses,” and then to Power Point Lecture Slides (Summer 2009).I may also post other information on this site, such as answer keys to worksheets and exams.

COURSE LEARNING OBJECTIVES:

1. To develop an understanding and appreciation of the critical financial issues facing managers of international firms in today’s increasingly globalized world.

2. To develop a practical framework for the analysis of exchange rates and foreign exchange exposures including an understanding of forces affecting exchange rates, possible models and approaches for forecasting exchange rates, and techniques for managing various types of foreign exchange exposures.

3. To develop students’ understanding of current issues and use of relevant data in the area of international finance through regular readings and discussions of articles in the financial press and through the use of appropriate on-line web sites.

THE 2010 LONDON SEMINAR IN INTERNATIONAL FINANCE AND BUSINESS:

Those of you interested in the summer 2010 London Seminar in International Finance and Business please refer to the London Seminar site on my home page (http://leeds-faculty.colorado.edu/palmerm/) under “Current Courses.” From this site you can also view the 2008 program itinerary.

USEFUL WEB SITES:

1. Real Time Foreign Exchange Quotes (spot rates)http://www.fxstreet.com/rates-charts/forex-charts/

2. Historical Foreign Exchange Rates Data and Charts: http://fx.sauder.ubc.ca/Daily and Weekly Rates: http://www.federalreserve.gov/releases/h10/update/Monthly and Annual Rates: http://www.federalreserve.gov/releases/g5/current/

3. Real Time Spot and Forward Exchange Rateshttp://www.ozforex.com/cgi-bin/spotrates.asp

4. Real Time Financial/Business News and Financial Datahttp://www.bloomberg.com/

5. United States and Foreign Stock Markets http://finance.yahoo.com/intlindices?uhttp://www.wallstreetsoftware.com/stocks.html

6. American Depository Receiptshttp://www.adr.com/

7. On Line International Business Commentaryhttp://www.cnb.com/business/international/fxupdate.asp

8. On Line Business/Finance Commentary http://w3.cantos.com/cantos/dyn/main.php?t=a

9. Foreign NewsJapan: http://www.japantimes.co.jp/U.K. : http://www.timesonline.co.uk/tol/global/China: http://www.chinadaily.com.cn/

10. Links to Central Bankshttp://www.bis.org/cbanks.htm

11. Links to Business Newshttp://news.bbc.co.uk/1/hi/business/http://www.reuters.com/business

12. Country Background Notes and Country Corruption Measureshttp://www.transparency.org/http://www.state.gov/r/pa/ei/bgn/

13. Report on US Intervention in Foreign Exchange Marketshttp://www.ny.frb.org/markets/foreignex.html

14. IMF Global Finance Reportshttp://www.imf.org/external/pubs/ft/gfsr/index.htm

STATEMENTS REQUIRED/RECOMMENDED BY THE OFFICE OF UNDERGRADUATE EDUCATION:

(1)   If you qualify for accommodations because of a disability, please submit to me a letter from Disability Services in a timely manner so that your needs may be addressed. Disability Services determines accommodations based on documented disabilities. Contact: 303-492-8671, Willard 322, and www.Colorado.EDU/disabilityservices. Disability Services' letters for students with disabilities indicate legally mandated reasonable accommodations.  The syllabus statements and answers to Frequently Asked Questions can be found at www.colorado.edu/disabilityservices.

(2) Campus policy regarding religious observances requires that faculty make every effort to reasonably and fairly deal with all students who, because of religious obligations, have conflicts with scheduled exams, assignments or required attendance.  Please call to my attention any religious observances which will conflict with assigned work, including, but not limited to, scheduled exams.

(3)  Students and faculty each have responsibility for maintaining an appropriate learning environment. Students who fail to adhere to such behavioral standards may be subject to discipline. Faculty has the professional responsibility to treat all students with understanding, dignity and respect, to guide classroom discussion and to set reasonable limits on the manner in which they and their students express opinions.  Professional courtesy and sensitivity areespecially important with respect to individuals and topics dealing with differences of race, culture, religion, politics, sexual orientation, gender variance, and nationalities. Class rosters are provided to the instructor with the student's legal name. I will gladly honor your request to address you by an alternate name or gender pronoun. Please advise me of this preference early in the semester so that I may make appropriate changes to my records.  See policesat: http://www.colorado.edu/policies/classbehavior.html   and athttp://www.colorado.edu/studentaffairs/judicialaffairs/code.html#student_code

Campus "Classroom Behavior" policy describes examples of unacceptable classroom behavior. Please see http://www.colorado.edu/policies/classbehavior.html 

(4)   The University of Colorado at Boulder policy on Discrimination and Harassment(http://www.colorado.edu/policies/discrimination.html, the University of Colorado policy on Sexual Harassment and the University of Colorado policy on Amorous Relationships applies to all students, staff and faculty.  Any student, staff or faculty member who believes s/he has been the subject of discrimination or harassment based upon race, color, national origin, sex, age,disability, religion, sexual orientation, or veteran status should contact the Office of Discrimination and Harassment (ODH) at 303-492-2127 or the Office of Judicial Affairs at 303-492-5550.  Information about the ODH and the campus resources available to assist individuals regarding discrimination or harassment can be obtained at http://www.colorado.edu/odh

(5)   All students of the University of Colorado at Boulder are responsible for knowing and adhering to the academic integrity policy of this institution. Violations of this policy may include: cheating, plagiarism, aid of academic dishonesty, fabrication, lying, bribery, and threatening behavior.  All incidents of academic misconduct shall be reported to the

Honor Code Council (honor@colorado.edu; 303-725-2273). Students who are found to be in violation of the academic integrity policy will be subject to both academic sanctions from the faculty member and non-academic sanctions (including but not limited to university probation, suspension, or expulsion). Other information on the Honor Code can be found at http://www.colorado.edu/policies/honor.html  and at http://www.colorado.edu/academics/honorcode/