Course Catalogue

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This course builds on the material covered in Finance 1 and Finance 2. It extends ideas on corporate finance introduced in Finance 2 and covers a number of central issues of relevance to the financial manager, such as capital structure, capital budgeting, long-term versus short-term financing, and corporate governance.

Lectures: 2 hours of lectures x 10 weeks.

Tutorials: 1 hour of tutorials x 8 weeks.

Tutorial slots can be selected on MyCampus.

Normally a grade D3 or above in Finance 2 or equivalent.

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ILO's

Reassessments are normally available for all courses, except those which contribute to the Honours classification. For non Honours courses, students are offered reassessment in all or any of the components of assessment if the satisfactory (threshold) grade for the overall course is not achieved at the first attempt. This is normally grade D3 for undergraduate students and grade C3 for postgraduate students. Exceptionally it may not be possible to offer reassessment of some coursework items, in which case the mark achieved at the first attempt will be counted towards the final course grade. Any such exceptions for this course are described below.

The aim of this course is to provide students with an advanced understanding, both theoretically and empirically, of some major aspects of corporate finance. Specifically, by means of the concepts and analytical tools learned in Finance 1 and Finance 2, the course introduces theories of capital structure and mechanics of the implementation. The course also covers special topics such as corporate governance and the real options approach to project valuation. After finishing this course, students are expected to have insights that are of academic interest and practical importance on crucial elements influencing the financing decisions of a typical financial manager.

By the end of this course students will be able to:

1. Evaluate different theories of capital structure both in the context of perfect capital markets and under market imperfections

2. Understand the sources, consequences, and possible remedies for information asymmetries and agency conflicts in a corporation

3. Analyse the role of different sources of corporate financing (short-term and long-term, equity and debt)

4. Understand the concept and different aspects of corporate governance

5. Work collaboratively in a group to produce a combined piece of coursework, by liaising with other class members, allocating tasks and co-ordinating group meetings."

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