Outline

Overview

This unit provides an introduction to basic concepts in corporate finance and their application to (1) valuation of risky assets including stocks, bonds and entire corporations, (2) pricing of equity securities, and (3) corporate financial policy decisions including dividend, capital structure and risk management policies. Emphasis is placed on the application of the material studied and current practices in each of the topic areas.

Unit details and rules

Unit code	FINC2011
Academic unit	Finance
Credit points	6
Prohibitions ?	None
Prerequisites ?	{(BUSS1020 or ECMT1010 or ENVX1001 or ENVX1002 or DATA1001) or [(MATH1005 or MATH1015) and MATH1115)] or 6 credit points in MATH units including MATH1905)} and (BUSS1040 or ECON1001 or ECON1002)
Corequisites ?	None
Assumed knowledge ?	BUSS1030
Available to study abroad and exchange students	Yes

Teaching staff

Coordinator	Jing Yu, jing.yu@sydney.edu.au

Type	Description	Weight	Due	Length
Online task	Quiz #1 Online Quiz	15%	Week 01	1 hour
Outcomes assessed:
Online task	Quiz #2 Online Quiz	15%	Week 02	1 hour
Outcomes assessed:
Assignment	Major assignment Written task	20%	Week 03 Due date: 02 Feb 2022 at 17:00 Closing date: 08 Feb 2022	4 pages
Outcomes assessed:
Final exam (Record+)	Final exam Online Exam	50%	Week 04 Due date: 10 Feb 2022 at 14:00	1.5 hours
Outcomes assessed:
= Type B final exam ?

Assessment summary

Quiz #1: This quiz will assess the material covered in topics 1-3 of the unit of study. You will be expected to demonstrate your understanding of this material by being able to answer multiple choice questions on these topics. The quiz consists of multiple choice questions only.
Quiz #2: This quiz will assess the material covered in topics 4-6 of the unit of study. You will be expected to demonstrate your understanding of this material by being able to answer multiple choice questions on these topics. The quiz consists of multiple choice questions only.
Major assignment: The Major Assignment will give you an opportunity to demonstrate your understanding of the material covered in the course. You will be required to identify and collect data relevant to the question and then utilise analysis techniques covered in the unit to resolve a problem. Marks for the assignment will be allocated based on the coherence of the student's argument in response to the specifics of the question, the strength of the evidence that the student uses to support their argument and overall discussion.
Final exam: Testing the complete understanding of the concepts, theory and practical applications taught during the unit of study. Students demonstrating knowledge at the required level will pass, for better grades students need to demonstrate a higher level of understanding of the topic than the minimum requirement. The exam consists of multiple choice questions and short answers.

Replacement exams: The Business School has determined that second replacement exams (both mid-semester and final) will not be offered for this unit of study should a student submit two special considerations for the same exam as this unit forms part of the professional accounting accreditation pathway. Should a student be granted a replacement exam via special consideration, and is then unable to attend or does not complete the replacement exam, any subsequent special consideration will result in a DC grade (Discontinue Without Fail).

Detailed information for each assessment can be found on Canvas.

Assessment criteria

The University awards common result grades, set out in the Coursework Policy 2014 (Schedule 1).

As a general guide, a high distinction indicates work of an exceptional standard, a distinction a very high standard, a credit a good standard, and a pass an acceptable standard.

Result name	Mark range	Description
High distinction	85 - 100	Awarded when you demonstrate the learning outcomes for the unit at an exceptional standard, as defined by grade descriptors or exemplars outlined by your faculty or school.
Distinction	75 - 84	Awarded when you demonstrate the learning outcomes for the unit at a very high standard, as defined by grade descriptors or exemplars outlined by your faculty or school.
Credit	65 - 74	Awarded when you demonstrate the learning outcomes for the unit at a good standard, as defined by grade descriptors or exemplars outlined by your faculty or school.
Pass	50 - 64	Awarded when you demonstrate the learning outcomes for the unit at an acceptable standard, as defined by grade descriptors or exemplars outlined by your faculty or school.
Fail	0 - 49	When you don’t meet the learning outcomes of the unit to a satisfactory standard.

For more information see sydney.edu.au/students/guide-to-grades.

For more information see guide to grades.

Late submission

In accordance with University policy, these penalties apply when written work is submitted after 11:59pm on the due date:

Deduction of 5% of the maximum mark for each calendar day after the due date.
After ten calendar days late, a mark of zero will be awarded.

Academic integrity

The Current Student website provides information on academic integrity and the resources available to all students. The University expects students and staff to act ethically and honestly and will treat all allegations of academic integrity breaches seriously.

We use similarity detection software to detect potential instances of plagiarism or other forms of academic integrity breach. If such matches indicate evidence of plagiarism or other forms of academic integrity breaches, your teacher is required to report your work for further investigation.

You may only use artificial intelligence and writing assistance tools in assessment tasks if you are permitted to by your unit coordinator, and if you do use them, you must also acknowledge this in your work, either in a footnote or an acknowledgement section.

Studiosity is permitted for postgraduate units unless otherwise indicated by the unit coordinator. The use of this service must be acknowledged in your submission.

Learning support

Simple extensions

If you encounter a problem submitting your work on time, you may be able to apply for an extension of five calendar days through a simple extension.  The application process will be different depending on the type of assessment and extensions cannot be granted for some assessment types like exams.

Special consideration

If exceptional circumstances mean you can’t complete an assessment, you need consideration for a longer period of time, or if you have essential commitments which impact your performance in an assessment, you may be eligible for special consideration or special arrangements.

Special consideration applications will not be affected by a simple extension application.

Using AI responsibly

Co-created with students, AI in Education includes lots of helpful examples of how students use generative AI tools to support their learning. It explains how generative AI works, the different tools available and how to use them responsibly and productively.

Weekly schedule

WK	Topic	Learning activity
Week 01	Introduction to finance and financial markets	Lecture and tutorial (3 hr)
	Financial mathematics I	Lecture and tutorial (3 hr)
	Financial Mathematics II	Lecture and tutorial (3 hr)
	Valuation of debt and equity	Lecture and tutorial (3 hr)
Week 02	Risk and return	Lecture and tutorial (3 hr)
	Capital asset pricing model (CAPM)	Lecture and tutorial (3 hr)
	Company cost of capital	Lecture and tutorial (3 hr)
	Equity capital markets	Lecture and tutorial (3 hr)
Week 03	Asset market efficiency and behavioural finance	Lecture and tutorial (3 hr)
	Capital budgeting I	Lecture and tutorial (3 hr)
	Capital budgeting II	Lecture and tutorial (3 hr)
	Final exam review	Lecture and tutorial (3 hr)

Attendance and class requirements

Lecture recordings: All lectures are recorded and will be available on Canvas for student use. Please note the Business School does not own the system and cannot guarantee that the system will operate or that every class will be recorded. Students should ensure they attend and participate in all classes.

Study commitment

Typically, there is a minimum expectation of 1.5-2 hours of student effort per week per credit point for units of study offered over a full semester. For a 6 credit point unit, this equates to roughly 120-150 hours of student effort in total.

Required readings

Brealey, R. A., Myers, S. C., and Allen, F. (2020); Principles of Corporate Finance (13th ed.); McGraw Hill Irwin.

Learning outcomes

Learning outcomes are what students know, understand and are able to do on completion of a unit of study. They are aligned with the University's graduate qualities and are assessed as part of the curriculum.

Outcomes
Graduate qualities

At the completion of this unit, you should be able to:

LO1. identify and explain the basic types of financial management decisions undertaken within a corporation and the role of corporate financial manager
LO2. describe and discuss the key elements of a modern financial system, including identification and discussion of the main categories of financial institutions, types of financial instruments, and functions of different financial markets
LO3. explain and apply the basic concepts underpinning the valuation of bonds and common equity securities
LO4. explain and apply the concepts of expected return, security risk, diversification, portfolio risk, ‘beta’ and the role they play underpinning asset pricing models such as the CAPM
LO5. calculate company beta, company and divisional cost of capital, and project cost of capital
LO6. explain and apply the Net Present Value (NPV) rule for corporate capital budgeting in realistic settings, as well as appraise the merits of other alternative investment criteria
LO7. discuss and explain the concept of market efficiency as well as identify instances of weak, semi-strong and strong forms of financial market efficiency.

Graduate qualities

The graduate qualities are the qualities and skills that all University of Sydney graduates must demonstrate on successful completion of an award course. As a future Sydney graduate, the set of qualities have been designed to equip you for the contemporary world.

GQ1	Depth of disciplinary expertise Deep disciplinary expertise is the ability to integrate and rigorously apply knowledge, understanding and skills of a recognised discipline defined by scholarly activity, as well as familiarity with evolving practice of the discipline.
GQ2	Critical thinking and problem solving Critical thinking and problem solving are the questioning of ideas, evidence and assumptions in order to propose and evaluate hypotheses or alternative arguments before formulating a conclusion or a solution to an identified problem.
GQ3	Oral and written communication Effective communication, in both oral and written form, is the clear exchange of meaning in a manner that is appropriate to audience and context.
GQ4	Information and digital literacy Information and digital literacy is the ability to locate, interpret, evaluate, manage, adapt, integrate, create and convey information using appropriate resources, tools and strategies.
GQ5	Inventiveness Generating novel ideas and solutions.
GQ6	Cultural competence Cultural Competence is the ability to actively, ethically, respectfully, and successfully engage across and between cultures. In the Australian context, this includes and celebrates Aboriginal and Torres Strait Islander cultures, knowledge systems, and a mature understanding of contemporary issues.
GQ7	Interdisciplinary effectiveness Interdisciplinary effectiveness is the integration and synthesis of multiple viewpoints and practices, working effectively across disciplinary boundaries.
GQ8	Integrated professional, ethical, and personal identity An integrated professional, ethical and personal identity is understanding the interaction between one’s personal and professional selves in an ethical context.
GQ9	Influence Engaging others in a process, idea or vision.

Outcome map

Learning outcomes	Graduate qualities
Learning outcomes

Responding to student feedback

This section outlines changes made to this unit following staff and student reviews.

In response to suggestions and feedback from past students, Quizzes will be in a similar structure as the Final Exam to prepare learners more effectively.

Additional information

Disclaimer

The University reserves the right to amend units of study or no longer offer certain units, including where there are low enrolment numbers.

To help you understand common terms that we use at the University, we offer an online glossary.

Current students

Overview

Overview

Unit details and rules

Teaching staff

Assessment

Assessment

Assessment summary

Assessment criteria

Late submission

Academic integrity

Learning support

Learning support

Simple extensions

Special consideration

Using AI responsibly

Weekly schedule

Weekly schedule

Attendance and class requirements

Study commitment

Required readings

Learning outcomes

Learning outcomes

Graduate qualities

Outcome map

Responding to student feedback

Responding to student feedback

Additional information

Additional information

Disclaimer

On this page

Useful links

Media

Student links

About us

Connect

Current students

FINC2011: Corporate Finance I

Intensive February, 2022 [Block mode] - Remote

Overview

Overview

Unit details and rules

Teaching staff

Assessment

Assessment

Assessment summary

Assessment criteria

Late submission

Academic integrity

Learning support

Learning support

Simple extensions

Special consideration

Using AI responsibly

Weekly schedule

Weekly schedule

Attendance and class requirements

Study commitment

Required readings

Learning outcomes

Learning outcomes

Graduate qualities

Outcome map

Responding to student feedback

Responding to student feedback

Additional information

Additional information

Disclaimer

On this page

Useful links

Media

Student links

About us

Connect