Bangladesh University of Professionals

Faculty of Business Studies

Course Mapping:

Bachelor of Business Administration (BBA)

Course Title: Financial Management
Course Code: FIN-2402
Credit Hours: 3

Instructor:
Md. Mominul Hoq
Lecturer (Finance)
Room No # 412
Email: muminndc@gmail.com

Course Objectives:
This course is designed to give the students a glimpse of the financial management process highlighting the principles and procedures encompassed
by financial practices. After successful completion of this course a students would be able to harness the followings:

 An introductory idea of the financial context and the players in its encompassments,
 Breakdown & scrutiny of financial statements,
 Basic concepts of time values of money, risk & return, bond & stock valuation,
 How to budget a firm’s capital by means of tools like NPV & IRR.
 How to Structure a company’s capital with the help of leverage and cost of capital concept.
  How to Manage accounts payables / receivables, short-term loans, usage of collaterals against short-term loans.

Suggested texts:
1. Ross S.A., Westerfield R.W., and Jaffe, J.F., “Corporate Finance”, McGraw-Hill
2. Fundamentals of Financial Management, J. Van Horne & John M Wachowicz
3. Gitman, Lawrence J., Roger Juchau, and Jack Flanagan. Principles of managerial finance. Pearson Higher Education AU, 2010.
4. CFA Level 1 Schweser Notes Package- Financial Reporting and Analysis - Kaplan Schweser
5. Reilly, Frank, and Keith Brown. Investment analysis and portfolio management. Cengage Learning, 2011.
6. Brigham F. Eugene, and Besley S., “Essentials of Managerial Finance”, Harcourt College Publishers. Block S.B., and Hirt G.A.,
“Foundations of Financial Management”, Irwin McGraw-Hill
7. Pandey, I. M. Essentials Of Financial Management, 1E. Vikas publishing house PVT ltd, 2009
8. Articles will be provided time to time.

Grading Schedule Marks for Evaluation

Letter Grade 1) 2 x Mid-term examinations of 20%

Range Of Number Grade Point approximately 1 hour duration each
80 and above A+ 4.00 2) Comprehensive Semester Final 50%
75 to less than 80 A 3.75 Examination
70 to less than 75 A- 3.50 3) Quizzes and/or weekly tests 10%
65 to less than 70 B+ 3.25 4) Term paper and/or project work 5%
60 to less than 65 B 3.00 including presentation
55 to less than 60 B- 2.75 5) Assignments, case studies, class 5%
50 to less than 55 C+ 2.50 6) participation 5%
45 to less than 50 C 2.25 7) Individual presentations 5%
40 to less than 45 D 2.00 Class attendance and participation, etc.
Less than 40 F 0.00 Total 100%
Teaching Methodology:
 Lecture based teaching would be preferred. Yet, occasionally multimedia may aid the teaching to facilitate audio-visual communication.
 The participation from the students in the classroom would be highly appreciated. An interactive classroom will prevail rather than one
way communication from the teacher himself.
 Student would be assigned to solve real life (case study) and / or text based problems to implement the theoretical knowledge gained
through the course.
 Students would be asked to present certain topics with or without prior notification. It may be a group based or individual presentation.
 Students may also face course related premises visiting (Like business organization visiting) to grab the real life practice of textual thoughts.

Points to be noted:
 Text Book: Since this course depends heavily on text materials of different authors, students are advised to carry text book of respective
authors as suggested in the outline, calculator and study materials from the second class of this course.
 Exam Policy: There will be two Mid-terms. Students will also face 4-5 quizzes / class tests in between the semester final & Mid-term.
Quizzes may be announced or unannounced. All the quizzes / class tests will be counted and averaged. Students should anticipate
unannounced quiz after the completion of every chapter.
 Exam Makeup: If a student misses a quiz, there will be no makeup for that.
 Class Makeup: If a class is missed due to unavoidable situation, makeup class would be held after consulting BBA program coordinator.
 Other points: Students are expected to come to class having completed an initial pre-reading of the text book materials and are expected
to be actively engaged in class discussion and problem solving of the in-class problem materials.

 All students are required to keep a copy of their assignment item. Where this is not possible students should, at least, keep rough notes used
in the preparation of the assignment.
 Submission of dishonest assignments/ term paper is strictly prohibited and subject to deduction of marks.
 "Dishonest assignment" includes:
 deliberate copying or attempting to copy the work of other students;
 use of or attempting to use information prohibited from use in that form of assessment;
 submitting the work of another as your own;
 plagiarism (i.e. taking and using as your own, the thoughts and writings of another with the intent to claim the work as your own);
 Any student found knowingly to have helped another student to produce an assignment dishonestly will incur the same penalty awarded to
that student.
 Full and detailed acknowledgment (e.g. notation, and/or bibliography) must be provided if contributions are drawn from the literature in
preparation of reports and assignments.
 The responsibility for submitting assignment items by the due date rests with the student. Any assignment received after the appropriate
due date will be considered "late" and will be penalized by the deduction of marks.
All the mobile phones must be in a silent mode and no one can receive phone calls during the class
 Course Mapping:

Topics Contents Sessions Points to Note Suggested Texts

What Is Financial Management? 1 Basic Finance Fundamentals of
The Role of
The Goal of the Firm-Value Creation • Agency Problems • will be served Financial Management,
Financial
Corporate Social Responsibility (CSR) here. J. Van Horne & John M
Management Corporate Governance Wachowicz
Organization of the Financial Management Function
Financial Role of Financial Reporting and financial statement analysis 3 Bring CFA Level 1 Schweser
Statement Roles of key financial statements Calculator. Quiz Notes Package-
Analysis Importance of financial statement notes and supplementary can appear Financial Reporting and
information unnoticed. Analysis - Kaplan
Audits of financial statements, the types of audit reports and Schweser
importance of internal controls
Steps in financial statement analysis framework
Balance sheet and income statement information – Possible
framework for analysis – Uses and types of financial ratios
Time Value of Discuss the role of time value in finance, the use of computational 3 Bring Fundamentals of
Money tools, and the basic patterns of cash flow. Understand the concepts Calculator. Quiz Financial Management,
of future and present value, their calculation for single amounts, can appear J. Van Horne & John M
and the relationship of present value to future value. Find the unnoticed. Wachowicz
future value and the present value of both an ordinary annuity and
an annuity due, and find the present value of perpetuity. Calculate
both the future value and the present value of a mixed stream of
cash flows. Understand the effect that compounding interest more
frequently than annually has on future value and on the effective
annual rate of interest. Describe the procedures involved in (1)
determining deposits to accumulate a future sum, (2) loan
amortization, (3) finding interest or growth rates, and (4) finding
an unknown number of periods.
Risk & Return Understand the meaning and fundamentals of risk, return, and risk 2 Knowledge of Gitman, Lawrence J.,
preferences. Describe procedures for assessing and measuring the Statistics is Roger Juchau, and Jack
risk of a single asset. Discuss the measurement of return and important. Get Flanagan. Principles of
standard deviation for a portfolio and the various types of those readings managerial finance.
correlation that can exist between series of numbers. Understand of Statistics Pearson Higher
the risk and return characteristics of a portfolio in terms of Education AU, 2010.
correlation and diversification, and the impact of international
assets on a portfolio. Review the two types of risk and the
 derivation and role of beta in measuring the relevant risk of both
an individual security and a portfolio. Explain the capital asset
pricing model (CAPM), its relationship to the security market line
(SML), and shifts in the SML caused by changes in inflationary
expectations and risk aversion.
Interest Rates & Describe interest rate fundamentals, the term structure of interest 3 Understanding Reilly, Frank, and Keith
Bond Valuation rates, and risk premiums. Review the legal aspects of bond of the Bond Brown. Investment
financing and bond cost. Discuss the general features, quotations, Market analysis and portfolio
ratings, popular types, and international issues of corporate bonds. management. Cengage
Understand the key inputs and basic model used in the valuation Learning, 2011.
process. Apply the basic valuation model to bonds and describe
the impact of required return and time to maturity on bond values.
Explain yield to maturity (YTM), its calculation, and the
procedure used to value bonds that pay interest semiannually.
Stock Valuation Differentiate between debt and equity capital. Discuss the rights, 4 Think you are Reilly, Frank, and Keith
characteristics, and features of both common and preferred stock. the equity Brown. Investment
Describe the process of issuing common stock, including in your holder or owner analysis and portfolio
discussion venture capital, going public, the investment banker’s of the company. management. Cengage
role, and stock quotations. Understand the concept of market Learning, 2011.
efficiency and basic common stock valuation under each of three
cases: zero growth, constant growth, and variable growth. Discuss
 the free cash flow valuation model and the use of book value,
liquidation value, and price/earnings (P/E) multiples to estimate
common stock values. Explain the relationships among financial
decisions, return, risk, and the firm’s value.
Capital Understand the role of capital budgeting techniques in the capital 4 A vital focus Ross S.A., Westerfield
R.W., and Jaffe, J.F.,
Budgeting budgeting process. Calculate, interpret, and evaluate the payback will be on this
“Corporate Finance”,
Techniques period. Calculate, interpret, and evaluate the net present value chapter McGraw-Hill
(NPV). Calculate, interpret, and evaluate the internal rate of return
(IRR). Use net present value profiles to compare NPV and IRR
techniques. Discuss NPV and IRR in terms of conflicting rankings
and the theoretical and practical strengths of each approach.

The Cost of Understand the key assumptions that underlie cost of capital, the 2 Understanding Ross S.A., Westerfield
R.W., and Jaffe, J.F.,
Capital basic concept of cost of capital, and the specific sources of capital of cost of
“Corporate Finance”,
that it includes. Determine the cost of long-term debt and the cost different McGraw-Hill
of preferred stock. Calculate the cost of common stock equity and sources of fund.
convert it into the cost of retained earnings and the cost of new
issues of common stock.

Leverage & Discuss the role of breakeven analysis, the operating breakeven 3 Bangladeshi Brigham F. Eugene, and
Capital point, and the effect of changing costs on it. Understand operating, firm scenario on Besley S., “Essentials of
Structure financial, and total lever-age and the relationships among them. Leverage Managerial Finance”,
Describe the types of capital, external assessment of capital Capital Harcourt College
structure, the capital structure of non-U.S. firms, and capital structure Publishers. Block S.B.,
structure theory. Explain the optimal capital structure using a and Hirt G.A.,
graphical view of the firm’s cost-of-capital functions and a zero- “Foundations of
growth valuation model. Discuss the EBIT–EPS approach to Financial Management”,
capital structure. Review the return and risk of alternative capital Irwin McGraw-Hill
structures, their linkage to market value, and other important
considerations related to capital structure.
Current Review the key components of a firm’s credit terms and the 3 Pandey, I. M. Essentials
Liabilities procedures for analyzing them. Understand the effects of Of Financial
Management stretching accounts payable on their cost, and the use of accruals. Management, 1E. Vikas
Describe the interest rates and basic types of unsecured bank publishing house PVT
sources of short-term loans. Discuss the basic features of ltd, 2009.
commercial paper and the key aspects of international short-term
loans. Explain the characteristics of secured short-term loans and
the use of accounts receivable as short-term-loan collateral.
Describe the various ways in which inventory can be used as short-
term-loan collateral.

Good Luck