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OL-FM I Course Outline

The document outlines the course Financial Management I at Hawassa University, focusing on financial principles, theories, and techniques essential for decision-making in organizations. It includes topics such as financial statement analysis, time value of money, cost of capital, and capital budgeting decisions. Assessment methods and recommended textbooks are also provided.

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12 views3 pages

OL-FM I Course Outline

The document outlines the course Financial Management I at Hawassa University, focusing on financial principles, theories, and techniques essential for decision-making in organizations. It includes topics such as financial statement analysis, time value of money, cost of capital, and capital budgeting decisions. Assessment methods and recommended textbooks are also provided.

Uploaded by

newaybeyene5
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Hawassa University

Department of Accounting and Finance


Course Title: Financial Management I Course Code :AcFn3041
Course Instructor: Alemu T. Contact Hours(per we.ek):3
Degree Program: BA in Accounting and Finance Academic Year: 2016 E.C Sem I

Course Description
The course provides a sound understanding of the financial principles, theories and techniques, and aims to
give a solid basis for decision making, incorporating the different aspects of the company. The course in
general concentrates in developing a high level understanding of the tactical and strategic significance of
the financial management function within organizations.
Course Content
Chapter One:- An Overview of Financial Management
 The nature and scope of financial management
 Financial Markets and Institutions
 Financial institutions
 Cash flows to and from the firm
 Primary markets vs. Secondary markets
 Money markets vs. Capital markets
 Financial management decisions
 Goal of the firm
 Possible goals
 The goal of the firm and financial management
 Basic forms of business organizations
Chapter Two:- IFRS-Based Financial Statement Analysis
 Purposes of financial analysis
 Tools for financial analysis
 Ratio Analysis
 Short term solvency or liquidity measures
 Long-term solvency measures
 Asset Management or turnover measures
 Profitability Measures
 Market Value Ratios (Measures)
 Problems with financial statement analysis
Chapter Three:- The time value of money
 Why money has a time value?
 Future Value of a single amount
 Present value of a single amount
 Future value of annuity
 Present value of annuity
 Special Case Annuities
 Perpetuities
 Deferred Annuity
 Uneven Cash Flow Streams
 More frequent compounding
 Compounding for less than a year
 Effective annual rate and the nominal rate
Chapter 4:- Cost of Capital
 The meaning of cost capital
 The components of the cost of capital
 The cost of debt and preferred stock
 The cost of common equity capital
 The cost of retained earnings and new common stock
 The meaning and use of the weighted average cost of capital(WACC)
 Adjusting cost of capital for project risk
Chapter 5:- Capital Budgeting Decisions
 The capital budgeting decision process
 Steps in the process
 Basic terminologies
 Cash flows
 The rational for the use of cash flows
 The cash flow after-tax (CFAT)
 Types of cash flows
 Cash flow worksheet
 Capital budgeting techniques
 Non-Discounted and Discounted Cash Flow Techniques ( for independent projects with or without capital
rationing problems and mutually exclusive projects )
 Methods for incorporating risk in to capital budgeting
 Risk adjusted discount rate
 Certainty Equivalents
 Sensitivity and Scenario analysis
Assessment & evaluation
Test 1----------------…..----------------------15%
Test 2………………….………………….15%
Quiz………………………………..……….5%
Assignment………………………………….20%
Final exam----------------------------------------40%
Text Book:
 Ross, S.A., Westerfield, R.W. and Jordan, B.D., Fundamentals of Corporate finance,10th edition, McGraw-
Hill/Irwin,USA,2013.
Reference Books
 Ross, S.A., Westerfield,R.W. and Jordan, B.D., Fundamentals of Corporate Finance, 2nd edition, Richard D.
IrwinInc.,USA, 1993
 Scott Besley and Brigham E. F., Essentials of Managerial
 Finance, 14th edition, Thomson South-Western, USA, 2008.
 Brigham, E.F. and Houston, J.F., Fundamentals of Financial
 Management, 9th Edition, South-Western, USA, 2001.
 Nevue, R.P., Fundamentals of Managerial Finance, 2nd edition, South-Western Publishing Co., Ohio, 1985
 Gitman, L.J., Principles of Managerial Finance, 12th edition, Harper Collins, USA, 2009.
Petty & et. A., Basic Financial Management, 6th edition, Prentice-Hall, Inc., 1993

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