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FI 360 Financial Management
Pizzillo, Joseph C.


Joseph Pizzillo
Joseph.Pizzillo@pirate.park.edu
Phone: 623-935-7054
Fax: 720-294-7034

Hello!! My name is Joe Pizzillo and I will be your Instructor for this class. I am currently the Budget and Research Manager for the City of Goodyear, AZ. I will enjoy sharing with you my 25 years of Accounting and Finance experience. I believe you will find this class beneficial to whatever career path you take

Park University Vision

Park University will be a renowned international leader in providing innovative educational opportunities for learners within the global society.

Park University Mission

The mission of Park University, an entrepreneurial institution of learning, is to provide access to academic excellence which will prepare learners to think critically, communicate effectively and engage in lifelong learning while serving a global community.

FI 360 Financial Management

The role of financial management through the development of a framework appropriate to financial decision making. Emphasis on obtaining and effectively utilizing the funds necessary for the operation of an enterprise. Elements of financial planning, capital budgeting, and consideration of alternative sources of funds. Prerequisites: AC 201 and AC 202. 3 semester credits.

Welcome to Financial Management (FI 360), online! This is an undergraduate introductory course in corporate financial management. It is designed to help you understand and appreciate the theoretical background of various analytical techniques, policies, and practices useful to the planning and controlling the financial resources of the business firm. Although the major emphasis of this course is on corporate finance, a portion of the materials covered can be applied to small business firms and to your understanding of personal finance and investments.

Each week we will focus on different topics, issues, and problems related to corporate financial management through our on-line conferencing discussions; these are reinforced and expanded in readings in our text, Foundations of Financial Management.

More specifically, this course is designed to provide you an understanding and appreciation of:

  • the nature and scope of financial markets
  • corporate financial analysis, planning, and control
  • financial forecasting and cash flow budgeting
  • the management of short-term and long-term financial needs, including leverage, debt capacity, and dividend policy
  • capital budgeting and time value of money
  • corporate growth through mergers
  • the international dimensions of financial management
  • the ethical dimensions of financial management

The course emphasizes the practical application of financial techniques and methods of analysis. Attention, however, is given to major theoretical contributions with respect to modern financial management. In addition, since this course if offered online, over the Internet and the World Wide Web (WWW), it is designed to introduce you to a large number of resources available on line. Incorporated in this course, are exercises and projects designed to help you become acquainted and use some of these WWW resources.

Prerequisites for this course are at least two introductory courses in accounting (AC 201 and AC 202). Background in economics and basic statistics may be useful but it is not required.

After you have completed this course, you should be able to:

  • explain the goals of financial management
  • compare the various legal forms of business organization
  • describe the scope and nature of financial markets
  • understand the financial choices used by firms in raising long-term financial capital
  • understand the role of investment banking institutions
  • distinguish between private placement and public offering of securities
  • calculate and interpret a comprehensive set of financial ratios
  • construct and analyze a firm's balance sheet, income statement, and statement of cash flow
  • generate a cash flow budget using basic financial statements
  • use interest factor tables, time value of money formulas or financial calculators to estimate the price of common stock, bonds, and preferred stock
  • describe the major characteristics and features of common stock, bonds, and preferred stock
  • explain the basic process of valuing assets
  • evaluate capital budgeting alternatives using the methods of payback period, net present value, profitability index, and internal rate of return
  • explain the concept of a firm's cost of capital and identify the factors affecting it
  • calculate a corporation's weighted average cost of capital
  • critically evaluate the use and limitations of breakeven analysis
  • understand the differences among operating leverage, financial leverage, and combined leverage
  • calculate a firm's operating leverage, financial leverage, and combined leverage
  • understand and explain the factors that affect a corporation's dividend policy
  • describe why and how a corporation might use stock dividends and stock-splits instead of cash dividends
  • explain the purpose and procedures related to stock repurchases
  • define net working capital and explain how it is determined
  • calculate the effective cost of short-term credit
  • list and describe the major sources of short-term credit
  • explain a firm's cash management objectives and decisions
  • analyze the different methods for managing a firm's cash collections and disbursement procedures
  • explain various factors affecting a firm's investment in accounts receivable and inventories
  • list and describe the different types of lease arrangements
  • differentiate between a convertible security and a warrant
  • describe why mergers may create value
  • list and discuss methods used in financing an acquisition
  • explain the use of a tender offer

Text: Foundations of Financial Management with CD, 11th Ed., Block & Hirt,ISBN 0-07-297792-2

Recommended Readings:

The Wall Street Journal Interactive Edition- http://www.wsj.com

Business Week - http://www.businessweek.com

Fortune - http://www.pathfinder.com

The Economist - http://www.economist.com

Grading Criteria:

·         The final course grade will be based on a weighted average score which will be determined using the weights shown below:

Description

% of Grade

Due Date

Class Participation & Homework

24%

Weeks 1-8

Mid Term Exam

20%

Weeks 1-4

Final Exam

30%

Weeks 4 and 8

Individual Project Report

26%

Week 7

 

Total 100%

 

  • The grading scale is as follows:

A 90% to 100%

B 80% to 89%

C 70% to 79%

D 60% to 69%

F below 60%

·         Each student is responsible for completing:

·         weekly reading assignments

·         weekly homework assignments

·         individual project

·         Two progress examinations (Mid Term & Final Exam)

The exams are scheduled as follows:

Progress

Exams

Chapters Covered

Due Date

Overall Weighting

Mid Term

1 through 8

End of Week 4

20%

 

 

 

 

Final

9 through 20 (excluding 13)

Week 8

30%

 

Examinations

A midterm and a final examination are required and will be based on materials covered in the readings. Specific instructions regarding exams will be posted later in the term.

The final examination will be taken in person during the 8th week of instruction at one of the Park University site.

Park Univeresity policies are in effect. The following paragraph is quoted from the 2003-2004 Park University Undergraduate Catalog: "Academic honesty is required of all members of the learning community. Hence, Park University will not tolerate cheating or plagiarism on tests, examinations, papers or other course requirements. Students who engage in such dishonesty may be given failing grades or expelled from the Park University.

Plagiarism - the appropriation or imitation of the language or ideas of another person and presenting them as one's original work- sometimes occurs through carelessness or ignorance.  Students who are uncertain about proper documentation of sources should consult their instructors."

Academic dishonesty could involve:

  • having a tutor or a friend complete your work
  • having a reviewer make extensive revisions of your work
  • collaborating with other students in completing your work unless you have been instructed to do so
  • submitting somebody else's work as your own
  • submitting work that does not represent your original words and/or ideas. This especially applies to answers to essay questions. Do not copy material verbatim from the text. Answer the questions in your own words.

Professors are required to keep attendance records and report absences throughout the term. Excused absences can be granted by the instructor for medical reasons, school sponsored activities, and employment-related demands including temporary duty. The student is responsible for completing all missed work.  Any student failing to attend class for two consecutive weeks, without an approved excuse from their instructor, will be administratively withdrawn and notified via email that you have been withdrawn and a grade of "WH" will be recorded.

An attendance report of "P" (present) will be recorded for students who have logged in to the Online classroom at least once during each week of the term.  PLEASE NOTE:  Recording of attendance is not equivalent to participation.  Participation grades will be assigned by each individual instructor according to the criteria in the Grading Policy section of the syllabus.

For more details on Park University on page 100 of the Park University Undergraduate Catalog.

Week 1

  • Readings:
  • Chapter 1: The Goals and Functions of Financial Management
  • Chapter 2: Review of Accounting
  • Chapter 3: Financial Analysis
  • Weekly Homework Assignment: After you finish the readings for Week 1,
    • Do the following application problems
      • Chapter 2: Problems 4, 15, and 16
      • Chapter 3: Problems 17, 18, and 30
  • .

Week 2

  • Readings:
  • Chapter 4: Financial Forecasting
  • Chapter 5: Operating and Financial Leverage

 

  • Weekly Homework Assignment: After you finish the readings for Week 2,
    • Do the following application problems:
      • Chapter 4: Problems 19 and 21
      • Chapter 5: Problems 5 and 9

Week 3

  • Readings:
  • Chapter 6: Working Capital and the Financing Decision
  • Chapter 7: Current Asset Management
  • Chapter 8: Sources of Short-Term Financing

 

REQUIREMENTS: Select a company whose stock is traded on the NYSE, AMSE, or the NASDAQ. The name of the company you select should begin with the first letter of your last name (not mandatory). Review the materials on ratio analysis discussed in Chapter 3 in your text and calculate as many ratios as possible for each of at least three most recent years for the company you selected. Then write a short, about one page, report in which you also interpret your findings.

  • Note: The individual project is due by the end of Week 7.

 

  • Weekly Homework Assignment: After you finish the readings for Week 3,
    • Do the following application problems:
      • Chapter 6: Problem 7
      • Chapter 7: Problems 3 and 15
      • Chapter 8: Problems 14 and 23

.

Week 4

  • Readings:
  • Chapter 9: The Time Value of Money
  • Chapter 10: Valuation and Rates of Return

 

  • Weekly Homework Assignment: After you finish the readings for Week 4,
    • Do the following application problems:
      • Chapter 9: Problems 19, 22, and 23
      • Chapter 10: Problems 22 and 24
  • Mid Term: Take Home Exam

Week 5

  • Readings:
  • Chapter 11: Cost of Capital
  • Chapter 12: The Capital Budgeting Decision
  • Chapter 14: Capital Markets

 

  • Weekly Homework Assignment: After you finish the readings for Week 5,
    • Do the following application problems:
      • Chapter 11: Problems 16 and 18
      • Chapter 12: Problems 1, 19 and 22

 

Week 6

  • Readings:
  • Chapter 15: Investment Banking: Public and Private Placement
  • Chapter 16: Long-Term Debt and Lease Financing
  • Chapter 17: Common and Preferred Stock Financing

 

  • Weekly Homework Assignment: After you finish the readings for Week 6,
    • Do the following application problems:
      • Chapter 15: Problems 5 and 11
      • Chapter 16: Problems 3
      • Chapter 17: Problems 9 and 17

 

Week 7

  • Readings:
  • Chapter 18: Dividend Policy and Retained Earnings
  • Chapter 19: Convertibles and Warrants
  • Chapter 20:External Growth through Mergers

 

  • Individual Project: The individual project is due in week 7.
  • Do the following application problems:  Chapter 18: Problems 9 and 16; Chapter 19: Problem 10; Chapter 20: Problem 5

Week 8

Final examinations will be administered during this last week of class.

McAfee Memorial Library - Online information, links, electronic databases and the Online catalog. Contact the library for further assistance via email or at 800-270-4347.

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