EFN412 Advanced Managerial Finance
To view more information for this unit, select Unit Outline from the list below. Please note the teaching period for which the Unit Outline is relevant.
| Unit code: | EFN412 |
|---|---|
| Prerequisite(s): | EFN406 |
| Equivalent(s): | EFX412 |
| Credit points: | 12 |
| Timetable | Details in HiQ, if available |
| Availabilities |
|
| Domestic tuition unit fee | $4,416 |
| International unit fee | $4,944 |
Unit Outline: Semester 1 2025, Gardens Point, Internal
| Unit code: | EFN412 |
|---|---|
| Credit points: | 12 |
| Pre-requisite: | EFN406 |
| Equivalent: | EFX412 |
| Coordinator: | Marco Elia | marco.elia@qut.edu.au |
Overview
This is an intermediate level unit which extends the study of financial management introduced in Managerial Finance. It provides an in-depth analysis of valuation and of the financial management of a business organisation. It develops further the framework necessary for the analysis of other and more advanced aspects of domestic and international business finance. With the growing sophistication of global financial markets, this unit provides an excellent base for students wishing to pursue a career in the field.
Learning Outcomes
On successful completion of this unit you will be able to:
- Apply the concepts of risk and diversification in portfolio construction, and demonstrate and apply knowledge of CAPM to solve financial problems.
- Apply critical thinking skills in analysing complex financial theories such capital structure choice to identify a firm's optimal composition of debt and equity and estimate the impact of capital choice under different assumptions.Relates to: PG Business Capabilities: KS (1.2)
- Apply multiple valuation methods to evaluate and make informed judgements about investments, mergers and acquisitions.Relates to: PG Business Capabilities: KS (1.2)
- Demonstrate and apply knowledge of derivatives to risk management and analyse and design financial risk management strategies for investors and firms under multiple circumstances.
Content
This unit covers three major areas related to the study of finance. The first results in students gaining knowledge of the asset pricing tools commonly used to value individual securities. The second area relates to understanding the firm's capital structure and how to apply the methods to value a firm. The third area relates to understanding the use and valuation of derivatives for risk management and to value the implicit option-features that show up in corporate finance.
The content of this unit includes:
- Portfolio Theory and Asset Pricing - Theoretical Development
- Portfolio Theory and Asset Pricing - Applications and Extensions
- Capital Structure Decisions
- Leasing
- Dividend Policy and Capitalization Changes
- Equity Market Valuation, Valuation of Individual Securities and Return Analysis
- Mergers and Acquisitions and Corporate Restructuring
- Markets and Valuation of Forward and Futures Contracts
- Markets and Valuation of Options Contracts
- Risk Management and Value at Risk
- Real options
QUT Business Capabilities (Postgraduate)
The content and assessment in this unit are aligned to a selection of the following set of QUT Business Capabilities, also known as Assurance of Learning Goals (AoLs). Developing these capabilities will assist you to meet the desired graduate outcomes set at QUT and equip you with the knowledge and skills to succeed in your chosen career.
Knowledge & Technical Skills (KS)
1.1 Demonstrate and apply integrated and advanced discipline and professional practice knowledge, including knowledge of relevant research principles and methods.
1.2 Apply technical, technological and technical research skills to organise and interpret discipline knowledge, including theory and practice, to investigate business issues.
Higher Order Thinking Skills (HO)
2.1 Critically investigate real world business issues and problems drawing on analysis, evaluation and synthesis of discipline knowledge, including theory and practice.
2.2 Exercise creativity and intellectual independence and make informed decisions and judgements in planning, designing, and executing strategic and research-based responses to address real world issues and problems.
Professional Communication (PC)
3.1 Use information literacy skills and communicate effectively and professionally in written forms and using media appropriate for diverse purposes, contexts and audiences.
3.2 Use information literacy skills and communicate effectively and professionally in oral forms appropriate for diverse purposes, contexts and audiences.
Teamwork & Self (TS)
4.1 Exercise self-reflection and accountability in applying knowledge and skills for own learning and effective practice.
4.2 Apply teamwork knowledge and skills for effective collaboration across a range of complex activities and contexts.
Social, Ethical & Global Understanding (SE)
5.1 Demonstrate and apply knowledge of ethical and legal principles and practices of business in critically analysing and effectively responding to complex business issues.
5.2 Demonstrate and apply knowledge of socially responsible behaviour in analysing and addressing business issues and critically reflect on the responsibilities and impacts of organisations in national and international business contexts.
Learning Approaches
This unit has a formal class contact time in lectures and tutorials of approximately three hours per week (lecture two hours, tutorial one hour). In addition a student should expect to devote, on average, nine further hours per week on self-study and assignments. The nine non-formal hours should be seen as a guide only, and not to be regarded as a restriction on the hours devoted to the unit.
Resources such as copies of overheads for each lecture topic, weekly reading and tutorial guides, assignments and solutions are provided on the unit Canvas site.
Students are expected to read the relevant material (textbook and notes), do the self-study questions provided and to review the lecture slides before attending the lecture. A weekly reading and tutorial guide can be found on the Canvas site. The reading guide indicates the material students should concentrate on, which material should be read lightly and which material should be studied in depth. Also included in the weekly guide are a number of self-study questions with solutions. These form an important part of the work in this unit and are a good indicator of possible examination questions.
Solutions to the weekly self-study questions will be provided in the weekly reading and tutorial guide and these will be discussed in the tutorial. Nevertheless, students should study this material before attending the tutorial so that effective use can be made of the time allocated to solve difficulties and discuss further issues. It is not the purpose of the tutorial to work through each question from scratch, but rather to resolve any problems or difficulties that arise from the week's work.
In accordance with QUT policy, all units are to be subject to Criterion Referenced Assessment (CRA). The unit coordinator will provide students with further details regarding CRA during the course of the semester during class and on the unit's Canvas site.
COVID-19 restrictions may require changes to the planned Learning Approaches described here. Students should refer to the unit Canvas site for the latest information.
Feedback on Learning and Assessment
Students will receive feedback in various forms throughout the semester which may include:
- Informal: worked examples, such as verbal feedback in class, personal consultation
- Formal: in writing, such as checklists (e.g. criteria sheets), written commentary
- Direct: to individual students, either in written form or in consultation
- Indirect: to the whole class
Assessment
Overview
The assessment in this unit aims to support your achievement of the unit learning outcomes and course assurance of learning goals. The assessment has been designed in order to allow you to:
- receive feedback on your learning as you progress toward the development of knowledge, understanding, skills and attitudes (formative assessment);
- demonstrate your learning in order to achieve a final grade (summative assessment).
Unit Grading Scheme
7- point scale
Assessment Tasks
Assessment: Mid-Semester Exam
The mid-semester exam will cover topics 1 to 5 inclusive.
Formative or Summative: Formative and Summative
Business Capabilities (AoL goals): KS (1.1)
Assessment: Assignment
The report involves the application of Portfolio Theory and empirical estimation, will cover addressing topics 1 to 5 inclusive.
This assignment is eligible for the 48-hour late submission period and assignment extensions.
Formative or Summative: Formative and Summative
Business Capabilities (AoL goals): KS (1.2), HO (2.2)
Assessment: Final Exam
The final exam will cover all topics but with emphasis on topics 6 through 11 inclusive. The final paper will consist of short answer questions.
Formative or Summative: Summative
Business Capabilities (AoL goals): KS (1.1, 1.2), HO (2.2), SE (5.2)
Academic Integrity
Academic integrity is a commitment to undertaking academic work and assessment in a manner that is ethical, fair, honest, respectful and accountable.
The Academic Integrity Policy sets out the range of conduct that can be a failure to maintain the standards of academic integrity. This includes, cheating in exams, plagiarism, self-plagiarism, collusion and contract cheating. It also includes providing fraudulent or altered documentation in support of an academic concession application, for example an assignment extension or a deferred exam.
You are encouraged to make use of QUT’s learning support services, resources and tools to assure the academic integrity of your assessment. This includes the use of text matching software that may be available to assist with self-assessing your academic integrity as part of the assessment submission process.
Breaching QUT’s Academic Integrity Policy or engaging in conduct that may defeat or compromise the purpose of assessment can lead to a finding of student misconduct (Code of Conduct – Student) and result in the imposition of penalties under the Management of Student Misconduct Policy, ranging from a grade reduction to exclusion from QUT.
Resources
Resource Materials
Prescribed text(s)
Jonathan Berk and Peter DeMarzo, Corporate Finance, Global Edition, 6th Edition, Pearson, 2023
Recommended text(s)
Suggested Supplementary Textbooks (Optional)
Ross, S. A., Thompson, S. C., Christensen, M. J., Westerfield, R. W., & Jordan, B. D. (2007) Fundamentals of Corporate Finance. . (4th edn.)(4th edn.). McGraw Hill.
or
Ross, S. A., Thompson, S. C., Christensen, M. J., Westerfield, R. W., & Jordan, B. D. (2004) Fundamentals of Corporate Finance. (4th edn.). McGraw Hill.
Other
Other Resources
Additional references and resources, including lecture overheads, additional notes, weekly reading and tutorial guides, assignments and solutions can also be found at the unit's Canvas site: https://Canvas.qut.edu.au/.
There are several other suitable texts that you may wish to use. Two are listed below:
Brealey, R., Myers S., & Allen F. (2020) Principles of Corporate Finance. (13th ed.) McGraw Hill.
Bishop HR, Faff RW, Oliver B, and Twite GJ, (2004) Corporate Finance. (5th ed.), Prentice Hall
Risk Assessment Statement
There are no out-of-the-ordinary risks associated with lectures or tutorials in this unit. You should, however, familiarise yourself with evacuation procedures operating in the buildings in which you attend classes and take the time to
view the Emergency video.
Standards/Competencies
This unit is designed to support your development of the following standards\competencies.
QUT Business Capabilities (Postgraduate)
HO (2.2): Independent Judgement and Decision-Making
Relates to: ULO4, Assignment, Final Exam
KS (1.1): Discipline and Professional Practice Knowledge
Relates to: ULO1, Mid-Semester Exam, Final Exam
KS (1.2): Technical, Technological and Research Skills
Relates to: ULO1, ULO2, ULO3, ULO4, Assignment, Final Exam
SE (5.2): Global Social Responsibility
Relates to: ULO4, Final Exam
Course Learning Outcomes
This unit is designed to support your development of the following course/study area learning outcomes.BS11 Master of Business
- Demonstrate and apply integrated and advanced discipline and professional practice knowledge, including knowledge of relevant research principles and methods.
Relates to: ULO1 - Demonstrate and apply knowledge of socially responsible behaviour in analysing and addressing business issues and critically reflect on the responsibilities and impacts of organisations in national and international business contexts.
Relates to: ULO4 - Apply technical, technological and technical research skills to organise and interpret discipline knowledge, including theory and practice, to investigate business issues.
Relates to: ULO1, ULO2, ULO3, ULO4 - Exercise creativity and intellectual independence and make informed decisions and judgements in planning, designing, and executing strategic and research-based responses to address real world issues and problems.
Relates to: ULO4
Unit Outline: Semester 1 2025, Online
| Unit code: | EFN412 |
|---|---|
| Credit points: | 12 |
| Pre-requisite: | EFN406 |
| Equivalent: | EFX412 |
Overview
This is an intermediate level unit which extends the study of financial management introduced in Managerial Finance. It provides an in-depth analysis of valuation and of the financial management of a business organisation. It develops further the framework necessary for the analysis of other and more advanced aspects of domestic and international business finance. With the growing sophistication of global financial markets, this unit provides an excellent base for students wishing to pursue a career in the field.
Learning Outcomes
On successful completion of this unit you will be able to:
- Apply the concepts of risk and diversification in portfolio construction, and demonstrate and apply knowledge of CAPM to solve financial problems.
- Apply critical thinking skills in analysing complex financial theories such capital structure choice to identify a firm's optimal composition of debt and equity and estimate the impact of capital choice under different assumptions.Relates to: PG Business Capabilities: KS (1.2)
- Apply multiple valuation methods to evaluate and make informed judgements about investments, mergers and acquisitions.Relates to: PG Business Capabilities: KS (1.2)
- Demonstrate and apply knowledge of derivatives to risk management and analyse and design financial risk management strategies for investors and firms under multiple circumstances.
Content
This unit covers three major areas related to the study of finance. The first results in students gaining knowledge of the asset pricing tools commonly used to value individual securities. The second area relates to understanding the firm's capital structure and how to apply the methods to value a firm. The third area relates to understanding the use and valuation of derivatives for risk management and to value the implicit option-features that show up in corporate finance.
The content of this unit includes:
- Portfolio Theory and Asset Pricing - Theoretical Development
- Portfolio Theory and Asset Pricing - Applications and Extensions
- Capital Structure Decisions
- Leasing
- Dividend Policy and Capitalization Changes
- Equity Market Valuation, Valuation of Individual Securities and Return Analysis
- Mergers and Acquisitions and Corporate Restructuring
- Markets and Valuation of Forward and Futures Contracts
- Markets and Valuation of Options Contracts
- Risk Management and Value at Risk
- Real options
QUT Business Capabilities (Postgraduate)
The content and assessment in this unit are aligned to a selection of the following set of QUT Business Capabilities, also known as Assurance of Learning Goals (AoLs). Developing these capabilities will assist you to meet the desired graduate outcomes set at QUT and equip you with the knowledge and skills to succeed in your chosen career.
Knowledge & Technical Skills (KS)
1.1 Demonstrate and apply integrated and advanced discipline and professional practice knowledge, including knowledge of relevant research principles and methods.
1.2 Apply technical, technological and technical research skills to organise and interpret discipline knowledge, including theory and practice, to investigate business issues.
Higher Order Thinking Skills (HO)
2.1 Critically investigate real world business issues and problems drawing on analysis, evaluation and synthesis of discipline knowledge, including theory and practice.
2.2 Exercise creativity and intellectual independence and make informed decisions and judgements in planning, designing, and executing strategic and research-based responses to address real world issues and problems.
Professional Communication (PC)
3.1 Use information literacy skills and communicate effectively and professionally in written forms and using media appropriate for diverse purposes, contexts and audiences.
3.2 Use information literacy skills and communicate effectively and professionally in oral forms appropriate for diverse purposes, contexts and audiences.
Teamwork & Self (TS)
4.1 Exercise self-reflection and accountability in applying knowledge and skills for own learning and effective practice.
4.2 Apply teamwork knowledge and skills for effective collaboration across a range of complex activities and contexts.
Social, Ethical & Global Understanding (SE)
5.1 Demonstrate and apply knowledge of ethical and legal principles and practices of business in critically analysing and effectively responding to complex business issues.
5.2 Demonstrate and apply knowledge of socially responsible behaviour in analysing and addressing business issues and critically reflect on the responsibilities and impacts of organisations in national and international business contexts.
Learning Approaches
This unit has a formal class contact time in lectures and tutorials of approximately three hours per week (lecture two hours, tutorial one hour). In addition a student should expect to devote, on average, nine further hours per week on self-study and assignments. The nine non-formal hours should be seen as a guide only, and not to be regarded as a restriction on the hours devoted to the unit.
Resources such as copies of overheads for each lecture topic, weekly reading and tutorial guides, assignments and solutions are provided on the unit Canvas site.
Students are expected to read the relevant material (textbook and notes), do the self-study questions provided and to review the lecture slides before attending the lecture. A weekly reading and tutorial guide can be found on the Canvas site. The reading guide indicates the material students should concentrate on, which material should be read lightly and which material should be studied in depth. Also included in the weekly guide are a number of self-study questions with solutions. These form an important part of the work in this unit and are a good indicator of possible examination questions.
Solutions to the weekly self-study questions will be provided in the weekly reading and tutorial guide and these will be discussed in the tutorial. Nevertheless, students should study this material before attending the tutorial so that effective use can be made of the time allocated to solve difficulties and discuss further issues. It is not the purpose of the tutorial to work through each question from scratch, but rather to resolve any problems or difficulties that arise from the week's work.
In accordance with QUT policy, all units are to be subject to Criterion Referenced Assessment (CRA). The unit coordinator will provide students with further details regarding CRA during the course of the semester during class and on the unit's Canvas site.
COVID-19 restrictions may require changes to the planned Learning Approaches described here. Students should refer to the unit Canvas site for the latest information.
Feedback on Learning and Assessment
Students will receive feedback in various forms throughout the semester which may include:
- Informal: worked examples, such as verbal feedback in class, personal consultation
- Formal: in writing, such as checklists (e.g. criteria sheets), written commentary
- Direct: to individual students, either in written form or in consultation
- Indirect: to the whole class
Assessment
Overview
The assessment in this unit aims to support your achievement of the unit learning outcomes and course assurance of learning goals. The assessment has been designed in order to allow you to:
- receive feedback on your learning as you progress toward the development of knowledge, understanding, skills and attitudes (formative assessment);
- demonstrate your learning in order to achieve a final grade (summative assessment).
Unit Grading Scheme
7- point scale
Assessment Tasks
Assessment: Mid-Semester Exam
The mid-semester exam will cover topics 1 to 5 inclusive.
Formative or Summative: Formative and Summative
Business Capabilities (AoL goals): KS (1.1)
Assessment: Assignment
The report involves the application of Portfolio Theory and empirical estimation, will cover addressing topics 1 to 5 inclusive.
This assignment is eligible for the 48-hour late submission period and assignment extensions.
Formative or Summative: Formative and Summative
Business Capabilities (AoL goals): KS (1.2), HO (2.2)
Assessment: Final Exam
The final exam will cover all topics but with emphasis on topics 6 through 11 inclusive. The final paper will consist of short answer questions.
Formative or Summative: Summative
Business Capabilities (AoL goals): KS (1.1, 1.2), HO (2.2), SE (5.2)
Academic Integrity
Academic integrity is a commitment to undertaking academic work and assessment in a manner that is ethical, fair, honest, respectful and accountable.
The Academic Integrity Policy sets out the range of conduct that can be a failure to maintain the standards of academic integrity. This includes, cheating in exams, plagiarism, self-plagiarism, collusion and contract cheating. It also includes providing fraudulent or altered documentation in support of an academic concession application, for example an assignment extension or a deferred exam.
You are encouraged to make use of QUT’s learning support services, resources and tools to assure the academic integrity of your assessment. This includes the use of text matching software that may be available to assist with self-assessing your academic integrity as part of the assessment submission process.
Breaching QUT’s Academic Integrity Policy or engaging in conduct that may defeat or compromise the purpose of assessment can lead to a finding of student misconduct (Code of Conduct – Student) and result in the imposition of penalties under the Management of Student Misconduct Policy, ranging from a grade reduction to exclusion from QUT.
Resources
Resource Materials
Prescribed text(s)
Jonathan Berk and Peter DeMarzo, Corporate Finance, Global Edition, 6th Edition, Pearson, 2023
Recommended text(s)
Suggested Supplementary Textbooks (Optional)
Ross, S. A., Thompson, S. C., Christensen, M. J., Westerfield, R. W., & Jordan, B. D. (2007) Fundamentals of Corporate Finance. . (4th edn.)(4th edn.). McGraw Hill.
or
Ross, S. A., Thompson, S. C., Christensen, M. J., Westerfield, R. W., & Jordan, B. D. (2004) Fundamentals of Corporate Finance. (4th edn.). McGraw Hill.
Other
Other Resources
Additional references and resources, including lecture overheads, additional notes, weekly reading and tutorial guides, assignments and solutions can also be found at the unit's Canvas site: https://Canvas.qut.edu.au/.
There are several other suitable texts that you may wish to use. Two are listed below:
Brealey, R., Myers S., & Allen F. (2020) Principles of Corporate Finance. (13th ed.) McGraw Hill.
Bishop HR, Faff RW, Oliver B, and Twite GJ, (2004) Corporate Finance. (5th ed.), Prentice Hall
Risk Assessment Statement
There are no out-of-the-ordinary risks associated with lectures or tutorials in this unit. You should, however, familiarise yourself with evacuation procedures operating in the buildings in which you attend classes and take the time to
view the Emergency video.
Standards/Competencies
This unit is designed to support your development of the following standards\competencies.
QUT Business Capabilities (Postgraduate)
HO (2.2): Independent Judgement and Decision-Making
Relates to: ULO4, Assignment, Final Exam
KS (1.1): Discipline and Professional Practice Knowledge
Relates to: ULO1, Mid-Semester Exam, Final Exam
KS (1.2): Technical, Technological and Research Skills
Relates to: ULO1, ULO2, ULO3, ULO4, Assignment, Final Exam
SE (5.2): Global Social Responsibility
Relates to: ULO4, Final Exam
Course Learning Outcomes
This unit is designed to support your development of the following course/study area learning outcomes.BS11 Master of Business
- Demonstrate and apply integrated and advanced discipline and professional practice knowledge, including knowledge of relevant research principles and methods.
Relates to: ULO1 - Demonstrate and apply knowledge of socially responsible behaviour in analysing and addressing business issues and critically reflect on the responsibilities and impacts of organisations in national and international business contexts.
Relates to: ULO4 - Apply technical, technological and technical research skills to organise and interpret discipline knowledge, including theory and practice, to investigate business issues.
Relates to: ULO1, ULO2, ULO3, ULO4 - Exercise creativity and intellectual independence and make informed decisions and judgements in planning, designing, and executing strategic and research-based responses to address real world issues and problems.
Relates to: ULO4