Managing Finance

BACKGROUND:

This course has the objective of reviewing the financial, control, and investment opportunities faced by rapidly growing companies in entrepreneurial settings. The main objective of study is to consider and select financing vehicles which are appropriate to securing the organizations' money requirements and to understand and analyze the issues in the institutional framework in which those decisions take place.

TEXTS:

1. Techniques of Financial Analysis, Helfert, 11th edition, Irwin, 2003.

2. APS Binder (Selected Cases) - available at Luvalle Commons bookstore.

SUPPLEMENTARY MATERIAL:

1. The Art of Case Analysis, Robert Ronstadt, is a suggested reading.

2. Corporate Financial Analysis, 7th edition, Diana Harrington, Irwin, 2004.

3. Prospecti from and articles about current financings will also be used as supplementary case assignments.

ORGANIZATION:

The classroom work will be based upon case materials. Initial classes will consider cases emphasizing various sources of financing, including short and long-term debt, subordinated capital, and equity. Public and private financing, on and off balance sheet capital, and tax oriented financing will also be included. Later and final cases will emphasize the selection and trade-offs of financing vehicles with company progress and market conditions. Analysis of different institutional regimes and the reasons for particular anomalies in pricing and availability in the financing of small and growing enterprises will be considered against views of markets and corporate finance.

REQUIREMENTS:

Students will be expected to analyze cases for classroom presentation and discussion. Each class will consider the assigned materials with four questions in mind:

1. How can the company be financed?

2. What is the attractiveness of the financing or investment to the investor?

3. Can improvements be made in the enterprise which could enhance or facilitate its financing?

4. What planning for alternative forms of financing can be assumed as market environments change?

Management 231E

Winter 2008

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Students should come to class prepared to present their conclusions about the assigned materials from each of the viewpoints outlined above. Adequate preparation is assumed. Students are strongly encouraged to work with classmates in developing solutions to these exercises. Students can expect attendance to be taken.

ASSESSMENT:

Grading is based on the following proportions:

Basis Amount

Class participation and attendance 67%

Examination 33%

100%

Relative performance in the class will be a criterion for grading.

COURSE ASSISTANT:

Students are encouraged to meet the course assistant who will meet with students as required in Suite D304C.

OFFICE HOURS:

An appointment with the course assistant or me can be made by calling 825-2985 to arrange for a time to see us on Mondays between 11:00 a.m. - 1:00 p.m.

FIRST CLASS:

The first class will meet and have classroom preparation expected on Monday, January 7, 2008.

FINAL:

Final for this class will be at 1-4 PM and 4-7 PM on March 7, 2008.

ATTENDANCE:

This course requires 10 class sessions. Two national holidays fall on a Monday in the Winter Quarter, January 21st and February 18th. Anyone enrolling should note that the first class is January 7th; and 3 Friday classes are scheduled for and attendance is required on January 18th, February 15th and February 22nd. The Final will be on Friday, March 7, 2008. Anyone enrolling in the class accepts this course schedule.

Management 231E

Winter 2008

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DATE SESSION TOPIC ASSIGNMENT

1/7 1 A Sytems Context for Financial Management HELFERT 1-44

Assessing Financial Health of the Firm APS - Readings

“Supplements” section APS

1/14 2 Managing Operating Funds HELFERT 45-105

Note on Bank Loans APS - Readings

Trade vs. Bank Debt пÑ"oCase: Clarkson Lumber Company APS Bank Financing

пÑ"oCase: Toy World, Inc. APS

- “Relations with capital suppliers” APS - Readings - Note on the Financial Perspective: APS - Readings

What Should Entrepreneurs Know? (9-293-045)

1/18 3 Assessment of Business Performance HELFERT 107-169

Projection of Financial Requirements HELFERT 171-208

Short Term vs. Long Term Debt

пÑ"oCase: SureCut Shears, Inc. APS

Capital Structure Theory

пÑ"oCase: Hampton Machine Tool Company APS

Capital