MN0368 Financial Appraisal, Risk and Corporate Valuation

Synopsis of Module

This module examines the nature of corporate finance and the decision making that it implicates. In particular, the module investigates the theoretical and practical issues involved in capital structuring, treasury management and investment appraisal. In this regard, the key notion of risk is explored. The module is assessed by an examination and an assignment.

Aims of Module

The module intends to:

1.	Explore the nature of investment appraisal

2.	Examine the role of the capital asset pricing model, treasury management and foreign exchange positioning with respect to the management of risk

3.	Appraise the issues associated with capital structure, mergers and acquisitions and dividend policy.

Learning Outcomes

At the end of the module the student should be able to:

1.	Select and apply financial theory in the diagnosis and resolution of business problems.

2.	Critically evaluate an investment decision-making scenario

3.	Critically evaluate a capital financial decision-making scenario

4.	Exercise significant judgement in the identification of optimal dividend policies

5.	Evaluate risk management techniques

Outline Syllabus

Investment appraisal

Quantitative and qualitative assessment

Replacement decisions

Cash flow, taxation and inflation

Capital rationing

Post audit appraisal

Risk

Risk and its management

The capital asset pricing model

Treasury management

Foreign exchange

Corporate Value

Capital structure

Gearing

Theoretical arguments in search of an optimal capital structure

Capital structure in practice

Dividend policy

Academic models and dividend irrelevancy

Mergers and Acquisitions

Financing mergers

The merger process

Summative assessment

Assessment A: Closed Book Examination (3 Hours)

The weighting of this assessment is 80%

Assessment B: Assignment

The weighting of this assessment is 20%