25558 Issues in Corporate Finance
UTS: Business: Finance and EconomicsCredit points: 6 cp
Subject level: Undergraduate
Result Type: Grade and marksRequisite(s): 25557 Corporate Finance: Theory and Practice
These requisites may not apply to students in certain courses.
There are also course requisites for this subject. See access conditions.
Handbook description
This subject explores the advanced topics in corporate finance such as the impact of differing taxation regimes, analysis of agency conflicts, use of alternative project evaluation methods and the use of options in valuation and project evaluation.
Subject objectives/outcomes
On successful completion of this subject students should be able to:
- appreciate the effects of taxation on corporate financing and investment decisions
- understand the implications of option pricing theory and agency theory for corporate financial policy
- understand the issues for valuation and financing of new and existing businesses
- evaluate alternative strategies for corporate restructuring.
Contribution to graduate profile
This subject builds on the foundation knowledge in finance and introduces students to advanced topics in corporate finance. It provides an overview of contemporary theories and examines their implications for corporate finance policy. Empirical evidence are analysed to gain an appreciation of issues in corporate finance decisions.
Teaching and learning strategies
The course will be taught using a combination of lectures and workshops. Both printed and electronic learning materials are available. Lecture materials are reinforced through discussion of tutorial questions.
Content
- Taxation, tax regimes and implications for financial decisions.
- Investment appraisals and option pricing theory
- Agency theory, stakeholders and financial choices
- Innovations in financing techniques
- Valuation and financing of new business
- Mergers and acquisitions
- Corporate restructuring.
Assessment
Assessment item 1: Assignment (Group)
| Objective(s): | 1-3 |
| Weighting: | 20% |
| Task: | The assignment will assess students' understanding of the issues involved in corporate financing decisions. The assignment will give students an opportunity to relate theory to practice. It will allow students to demonstrate that they have met objectives 1-3. |
Assessment item 2: Mid-Semester Examination (Individual)
| Objective(s): | 1-3 |
| Weighting: | 25% |
| Task: | The mid semester examination will test students understanding of the critical issues relating to financing choices. It assures objectives 1-3. |
Assessment item 3: Final Examination (Individual)
| Objective(s): | 1-4 |
| Weighting: | 55% |
| Task: | The final examination will test students understanding of the theory and their ability to apply the theory to corporate decisions. Students will be required to demonstrate proficiency in evaluating corporate restructuring alternatives. This assures objectives 1-4. |
Required text(s)
Berk, Jonathan and DeMarzo, Peter, Corporate Finance, Pearson International Edition, Pearson Education, Inc., 2007
Recommended text(s)
Brealey, R., Myers, S., Partington, G., and Robinson, D., Principles of Corporate Finance, 1st Australian edition, McGraw-Hill/Irwin, 2000
Indicative references
Faculty of Business (2006), Guide to Writing Assignments (available through UTSOnline or at www.business.uts.edu.au/resources/guide.html)
Lecture overheads
These are available at a printing cost recovery price. These can be purchased from either the Broadway (Level 3, Tower Building) or the Haymarket (Building 5D) Union Shops.
The CN number for the lecture overheads will be posted on UTSOnline as it becomes available. Copies of the lecture overheads will also be available on UTSOnline.
Note that the subject slides are not a substitute for the recommended textbook.
Other references
A sample mid-semester exam with solution will be available on UTSOnline. Final exam will be similar to the mid semester in structure. No sample final exam will be provided.
