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Diploma in Accounting Program | BUSI 370: Business Finance, Section 921

COURSE INFORMATION Term/Period:

2020 Summer – Term 1

Instructor:

Aziz Rajwani, CPA, CA

E-mail:

[email protected]

Course Schedule:

Tuesday/Thursday 6:30-9:30 pm on Zoom and recorded (link posted in Announcements on Canvas)

Course Duration:

May 12th, 2020 to June 18th, 2020

Office Hours:

Tuesday/Thursday before/after class on Zoom (by appointment) and as needed via email (please include your phone number)

Pre-Requisite:

BUSI 293 (may be taken as a co-requisite).

Students with a strong quantitative background may take BUSI 370 concurrently with BUSI 293. For students with a limited quantitative background, completing BUSI 293 and the DAP Quantitative Methods Preparatory Course is highly recommended. Prior to taking BUSI 370, students are expected to have acquired a basic understanding of financial statements (the income statement, the balance sheet and the cash flow statement), the key financial ratios (profitability, liquidity, solvency and market test); the ability to solve for unknowns in equations and an understanding of the rules for exponents. Some understanding of basic statistics (the arithmetic and geometric mean, variance, standard deviation, covariance, correlation coefficient, and linear regression) would also be beneficial. Students should have or need to develop proficiency in using Excel.

COURSE DESCRIPTION The objective of BUSI 370 is to provide students with a working knowledge and understanding of the practice and theory of modern corporate financial management. Students will develop the key analytical tools that are commonly used in structuring and making financial decisions and gain an understanding of the institutional environment within which financial decisions occur. Students will examine the two major areas of corporate financial analysis and decision making: decisions involving the procurement of funds (debt and equity financing) to ensure adequate financing for the ongoing activities of the firm and decisions involving the investing of funds with the goal of maximizing economic value of the firm for its owners. Under the procurement of funds, we will examine the role and functioning of financial markets, the various types of financing instruments that are commonly available, calculate the firm’s cost of capital and evaluate the firm’s financing strategy. Under the disbursement of funds, we will apply time value of money concepts to the valuation of individual debt and equity securities, conduct risk analysis, and evaluate capital investments using various discounted cash flow techniques. BUSI 370 Business Finance – Aziz Rajwani – Spring 2020 – Page 1 of 7

Diploma in Accounting Program | BUSI 370: Business Finance, Section 921

COURSE GOALS Business Finance aims to provide students with a working knowledge of financial markets and the fundamental concepts of corporate finance and to develop the necessary quantitative and critical thinking skills required to analyze and evaluate individual and corporate financing and investment decisions.

LEARNING OBJECTIVES Upon completion of BUSI 370 students will be able to:       

Understand and explain the key features of financial markets and securities Perform time value of money calculations Analyze and evaluate corporate and individual financing and investments decisions Value riskless and risky assets Estimate project cash flows and evaluate capital budgeting decisions using discounted cash flow analysis Analyze a firm’s capital structure and calculate a firm’s cost capital Perform various types of financial valuations

COURSE MATERIALS & REQUIREMENTS Textbook:

WileyPlus (Legacy), Introduction to Corporate Finance, by Laurence Booth and W. Sean Cleary, 4th Edition, Wiley. Class notes (blank) will be posted on Canvas (at least 24 hours) before class and the class notes (annotated) will be posted after class (within 12 hours of the end of class) on Canvas. Other materials may be posted on the Canvas course website throughout the term. Technology Requirements: Your laptop and home Internet service should meet the following minimum requirements: • •

Internet: at least 2Mbps download and 2Mbps upload speed. (You can check your home Internet at: http://www.speedtest.net) Laptop: o Apple: MAC OSX 10.9 or above, PC: Windows 7 or later o Webcam and microphone (built-in or external) o At least 4GB of RAM

A business calculator which can perform discounted cash-flow calculations is required. Please note that CPA courses require you to purchase the Texas Instruments Business Analyst II Plus financial calculator. The Hewlett Packard 10BII+ (or 10B, or 10BII), the Texas Instruments Business Analyst II (which is used by the textbook), and the Sharp Business Calculator (EL-738) are also capable of performing discounted cash-flow calculations. BUSI 370 Business Finance – Aziz Rajwani – Spring 2020 – Page 2 of 7

Diploma in Accounting Program | BUSI 370: Business Finance, Section 921 IT IS EXTREMELY IMPORTANT THAT YOU HAVE YOUR FINANCIAL CALCULATOR AT THE FIRST CLASS. Campus-Wide Login (CWL): All students at UBC are required to sign-up for a Campus-Wide Login (CWL), which can be used to access a number of services at UBC such as the SSC, Canvas and UBC E-mail. Information about CWL can be found at: https://it.ubc.ca/services/accounts-passwords/campus-wide-login-cwl Canvas: We will be using the Canvas Learning Management System for this course. The course page will be accessible starting May 8th. Canvas will contain the critical files for the course, including assignments, assignment solutions, a practice midterm with solutions and final examination problems with solutions. ALL THE FILES WILL BE IN “MODULES”. Students are advised to check this site regularly for updates. How to Login to Canvas: Follow these steps to access the Busi 370 course page on Canvas:  Go to www.canvas.ubc.ca click “Login to Your Courses” In the blue box (labelled “Login to www.canvas.ubc.ca”), enter your Login ID and password, then click on the “Login” button:  Login ID: Your CWL (Campus Wide Login).  Password: Your CWL password  Click on the course name (BUSI 370) Technical Support: If you experience any technical difficulties with your login, please contact the UBC Information Help Desk. By e-mail: [email protected] or by phone: 604-822-2008

ASSESSMENT SUMMARY The course grade will determined using the following weighting for the different components of the course: Final Exam 55% Midterm 35% Assignments 10% 100% You must achieve an aggregate passing grade on the examination components in order to pass the course. [(MT*35% + FINAL*55%) ≥ 45%] BUSI 370 Business Finance – Aziz Rajwani – Spring 2020 – Page 3 of 7

Diploma in Accounting Program | BUSI 370: Business Finance, Section 921 ASSIGNMENTS The homework assignments are due at the beginning of class. Late assignments will not be accepted nor will any assignments be remarked. Submit assignments based on the .pdf templates posted on CANVAS.

POLICIES & PROCEDURES UBC places a high value on academic integrity and it is a core value of the DAP diploma. Submitting someone else’s work as your own constitutes plagiarism and is a form of academic misconduct. The UBC calendar sets out the policies on academic honesty and what constitutes academic misconduct. For more information please refer to the UBC calendar: http://www.calendar.ubc.ca/vancouver/index.cfm?tree=3,54,111,0 Late assignments will not be accepted. Assignment solutions will be posted on Canvas and discussed in-class as required. In order to pass the course, students must achieve a minimum grade of 50% on the examination components of the course as indicated in the assessment summary above. The midterm exam will be written (during class time) on June 9th. I have no discretion to allow the final exam to be written at any time other than the scheduled time. The exam period for this semester runs from June 22nd–26th. The final exam schedule should be available by the end of May. Cell phones or any other electronic devices, with the exception of your business calculator, are not permitted on your desk during the exam. Your identification will be verified at the examinations. Please have you UBC student card with you. All other course and program polices can be found in the DAP Program Policies, available on myUBCDAP: https://professional.sauder.ubc.ca/dap/students/myubcdap/academic/index.cfm.

UNIVERSITY POLICIES AND RESOURCES UBC provides resources to support student learning and to maintain healthy lifestyles but recognizes that sometimes crises arise and so there are additional resources to access including those for survivors of sexual violence. UBC values respect for the person and ideas of all members of the academic community. Harassment and discrimination are not tolerated nor is suppression of academic freedom. UBC provides appropriate accommodation for students with disabilities and for religious observances. UBC values academic honesty and students are expected to acknowledge the ideas generated by others and to uphold the highest academic standards in all of their actions. Details of the policies and how to access support are available on the UBC Senate website at https://senate.ubc.ca/policies-resources-support-student-success.

ACADEMIC CONCESSIONS The following accommodations are available to students with valid academic concession requests.  The due date for any assignment may be modified for an individual student. BUSI 370 Business Finance – Aziz Rajwani – Spring 2020 – Page 4 of 7

Diploma in Accounting Program | BUSI 370: Business Finance, Section 921 

If you are unable to write the midterm exam based on medical circumstances or compassionate grounds, please communicate with me (in a timely manner) and arrangements to write a supplemental exam will be made.

COURSE SCHEDULE DATE May 12, 14, 19 May 19 SATURDAY May 23 11 am-1:30 pm May 21 May 21, 26 May 26, 28 May 28, June 2 June 2, 4

SATURDAY June 6 11-1:30 pm TUESDAY June 9 6:30−9:30 June 11

FRIDAY June 12 June 12, 16 June 18

TEXTBOOK READINGS (4th Edition) Chapter 5 Chapter 1: Topic 1.1 (p. 4) & Topic 1.4 (pp. 16-21) Chapter 2: Topic 2.2, 2.3 & 2.4 (pp. 35-46) Attendance is optional. All notes/questions done (and recording) will be posted on CANVAS. Working Capital Management Chapter 24: Topic 24.4 (pp. 857-858) Bond Valuation and Interest Rates Chapter 6 Equity Valuation Chapter 7 Risk, Return and Portfolio Theory Chapter 8: Topics 8.1, 8.2 & 8.3 The Capital Asset Pricing Model (CAPM) Chapter 9: Topic 9.3 Cash Flow Estimation and Capital Chapter 14 (IGNORE CCA recapture and terminal Budgeting Decisions losses and pages 512-513). Topic 14.5 to be covered on June 11. The Canadian Tax System Chapter 3: Topic 3.5 (pp. 83-87) BUT IGNORE [Examined on the Final.] CCA recapture and terminal losses) Attendance is optional. All notes/questions Question/Answer/Review Session on done (and recording) will be posted on Midterm. CANVAS. Midterm Exam [NORMAL Class day and time] [All material covered up to and including Chapter 9− i.e., material covered up to and including the first-half of the June 2 class.] Capital Budgeting, Risk Considerations, Chapter 13. and Other Special Issues Independent and Interdependent Projects Chapter 13: Topic 13.3 Inflation and Capital Budgeting Decisions Chapter 14: Topic 14.5 Debt, Equity and Hybrid Instruments Chapter 18: Pages 632-633 and 647-651 Chapter 19: Topics 19.1 & 19.2 Cost of Capital Chapter 20 (IGNORE pp. 716-720) Capital Structure Decisions Chapter 21 (Financial Leverage: pp. 744-750; Topics 21.5, 21.6 and 21.7) Dividend Policy Chapter 22: Topics 22.1, 22.2, 22.5 and 22.6 (IGNORE Repackaging Dividend-Paying Securities) TOPIC Time Value of Money An Introduction to Finance Business (Corporate) Finance Question/Answer/Review Session on Time Value of Money.

BUSI 370 Business Finance – Aziz Rajwani – Spring 2020 – Page 5 of 7

Diploma in Accounting Program | BUSI 370: Business Finance, Section 921 HANDOUT POSTED ON CANVAS

Mergers & Acquisitions: Valuations [NOT EXAMINABLE]

FRIDAY June 19

Attendance is optional. All notes/questions Question/Answer Session on topics done (and recording) will be posted on covered on the final. Please bring the practice final questions (posted on CANVAS. CANVAS). Date is scheduled by the Registrar’s office (NOT me). DO NOT MAKE ANY PLANS until you know the exact date and time (posted on www.students.ubc.ca by the end of May ). The FINAL EXAM will be ENTIRELY based on POST-MIDTERM material.

June 22-26

Chapter 15 (Topic 15.5) & Appendix 7B

ANYTHING NOT COVERED IN CLASS, IS NOT EXAMINABLE. Assignment Schedule Assignments are to be submitted online in the assignment drop box by the beginning of the lecture as per the assignment schedule. Assignments MUST be typed [Font please. Thanks.

size 14 point (Arial), spacing 1.5] and submitted as a PDF file

Late assignments will not be accepted. Homework assignments and related solutions will be posted on CANVAS. Your FILE must be submitted in the following manner: Rajwani,Aziz,Assignment#.pdf LAST Name (Family Name), THEN

,Aziz,Assignment#]

A COMMA, FIRST Name (Given Name). [Rajwani

NUMBER

CHAPTER###

DUE DATE

1

5 and 24

May 26

2

6 and 7

May 28

3

8 and 9

June 4

4

14

June 11

5

13 and 13.3

June 16

BUSI 370 Business Finance – Aziz Rajwani – Spring 2020 – Page 6 of 7

Diploma in Accounting Program | BUSI 370: Business Finance, Section 921 6

14.5 and 20

### THE ASSIGNMENT QUESTIONS ARE NOT FROM THE TEXTBOOK.

BUSI 370 Business Finance – Aziz Rajwani – Spring 2020 – Page 7 of 7

June 18...