UNIVERSITY OF THE PUNJAB

JHELUM CAMPUS

B.Com (Hons)
COURSE OUTLINE: ADVANCE FINANCIAL MANAGEMENT

COURSE INSTRUCTOR: Adeel Nasir

COURSE DESCRIPTION:

This course will enhance students understanding of how financial decisions create value for a
firm. Students are introduced to the areas of business valuations, corporate financing and
capital structure. The course will enable students to build an understanding of how strategic
financial decisions are taken and how the outcomes are quantified. Additionally the course aims
at enabling students to assess and manage corporate risks.

Contents:

 Cost of Capital
o Overview of cost of capital
o Cost of long term debt
o Cost of preferred stock
o Cost of common stock
o WACC
 Capital budgeting techniques
o Overview of capital budgeting
o Payback period
o Net present value (NPV)
o Internal Rate of Return (IRR)
o Comparing NPV and IRR techniques
 Capital Budgeting cash flows
o Relevant Cash flows
o Finding the initial investment
o Finding the operating cash inflows
o Finding the terminal cash flows
o Summarizing the relevant cash flows
 Risk and Refinement in Capital Budgeting
o Introduction to risk in capital budgeting
o Behavioral approaches for dealing with risk
o International risk consideration
o Risk adjusted discount rates
o Capital budgeting refinement

Textbook:
“Strategic Corporate Finance Application in Valuation and Capital Structure” by Justin Pettit,
John Wiley and Sons Co. (2007)
“Fundamentals of Corporate Finance” Latest Edition, by Ross, Westerfield and Jordon, McGraw-
Hill Co.
“Corporate Finance Theory and Practice” by Pascal Quiry, Maurizio Dallocchio, Yann Le Fur and
Antonio Salvi, John Wiley and Sons Co. (2005)
“Investment Valuation: Tools and Techniques for Determining the Value of Any Asset” Second
Edition, Aswath Damodaran, John Wiley & Sons Co. (2002).
“Quantitative Corporate Finance” by Guerard Jr. and Schwartz, Springer (2007)
“Financial Management and Analysis” 2nd Edition by Frank Fabozzi & Peterson, John Wiley and
Sons Co. (2003)