Syllabus

Fundamentals of Financial Management

Master of Science in Management

Credit units 3 units

Facilitator Agus Setiawan, Ph.D., CMA.

Office Faculty of Economics and Business

Universitas Gadjah Mada
South-wing 3rd Floor
Bulaksumur, Yogyakarta - Indonesia 55281
Phone : +62 274 548510 ext. 143
e-mail : agus_setiawan@ugm.ac.id

Consultation Monday 13.00 – 14.00

Time Wednesday 13.00 – 14.00

Course Financial Management is an introductory finance course designed to make

Description students understand the basic finance concepts. The course involves
studies on decision-making utilizing financial resources available to the firm
from the perspective of the manager. The course emphasizes the
understanding of finance theory and working knowledge of the financial
environment in which the firm operates in order to develop appropriate
financial strategies. Hence, it covers the whole range of basic finance
concepts, economics and financial environment, financial statement
analysis, risk and return analysis, the valuation process (bond and stock),
capital budgeting (cost of capital and cash flow estimation), capital
structure, distribution to shareholder (dividend decision) and working capital
management.

Learning After completion of this course, students are expected to be able to:
Objectives 1. Identify and describe basic concepts and theories in finance,
especially the financial management of business corporations.
2. Identify critical point of financing decisions process, interpret
financial statement.
3. Analyze risk and return, analyze financial statement (financial ratio),
evaluate corporate operation and performance; distinguish financial
performance, risk and return of companies from different industries
characteristics.
4. Estimate cost of capital, valuate corporate asset both real assets
(capital budgeting, project analysis) and financial assets (bonds and
stocks).
5. Understand capital structure theories and payout policy, evaluate
and make decision based on the theories.
6. Understand working capital management.
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 7. Analyze problems, weighing alternative solutions, and deciding the
best possible solution to a company’s problems or opportunities in the
financial context.

Book and 1. Brigham and Houston, adapted by Jun-Ming, Yoon Kee and Arifin
Reading (2018) Essential of Financial Management . Fourth Edition, Cengage
Material Learning Asia Pte Ltd, Singapore (BH).
2. Titman, Keown and Martin (2018) Financial Management: Principles
and Applications, 13th edition, Pearson (TKM).
3. Additional materials will be announced or distributed later.

Students’ Class participation. Students are highly expected to contribute ideas,

Responsibilities thoughts, experiences, and argument to the class discussion. Although
overviews of key points and issues will be provided, we strongly
recommend that students comprehend the materials in details, raise
questions and ideas, and create a “lively” class, meaning that you must
read and prepare readings assigned prior to coming to the class.

Absenteeism Predicted on FEB UGM regulation, students are required to attend 100% of
total lectures held. Any violations against this rule may render the final
grade penalized.

Learning An experiential approach. Continuously and consistently, students are

method assigned to construct experiential observations on managerial cases and
practices, and subsequently report the findings to the instructor.

Internet exploration. Students are encouraged to harness the advancement

of information technology in exploring knowledge and opportunities.
Remember that in current circumstances, a clever person is not she being
able to answer all questions; rather, it knows where to find answers.

Assignments. Student will be assigned individually to solve problem at the

end of each chapter. It is expected that the student works diligently on these
assignments so as to apply theoretical concepts to real problems and
develop students’ analytical and problem solving skills.

Examinations. Mid-term and final test purport to examine students’

Grading knowledge and understanding on concepts learnt in the lectures.
WEIGHT SCORE:
Assignment : 25%
Participation, Discussion & Quiz : 25%
Mid-Term Exam : 25%
Final Exam : 25%

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 Topics and Learning Goals
Learning Goals Source & Assignment
Session Topic(s)
DAUK DAC DAWT DUICE DAL
1 Overview of Financial BH-1 & 2
Management and Financial   Q1- 8 & 11;
Markets & Institutions Q2 – 1 & 4
2 Financial Statements, Cash
   BH-3
Flow, and Taxes P3 – 14 & 16
Analysis of Financial BH-4 & 6
Statements & Financial    P4- 9 & 24;
Planning P6 - 13
3 BH-5 & 7
The Time Value of Money and
Interest Rate
  P5- 13 & 37;
P7- 1 & 18
4 BH-8 & 9
Risk & Rate of Return and
Bond and Their Valuation
  P8 – 19;
P9- 2 & 18
5 BH-10
Stock and Their Valuation  
P10- 15 &21
Midterm Exam
6 The Cost of Capital
  BH-11
P11- 8 & 12
The Basic Capital Budgeting
  BH-12
P12- 7 & 19
7 Cash Flow Estimation and BH-13 & 14
Real Options   P13- 7 & 19;
P14- 2 & 7
8 Capital Structure and BH-15
 
Leverage P15- 2 & 10
9 Distribution to Shareholders,
BH-16
Dividend & Share  
Repurchase P16- 7 & 9
10 Working Capital Management
  BH-17
P17- 5 & 10
Final Exam

DAUK=Demonstrate the Ability to Understand Knowledge in the Field of FM; DAC= Demonstrate the Ability to
Communicate; DAWT = Demonstrate the Ability to Work in Team; DUICE = Demonstrate the Ability to Identify and Make a
Choice based on Ethical consideration; DAL= Demonstrate the Ability to Leads others.

Notes:
1. Other materials will be announced.
2. Q: Questions
3. P: Problems
4. Individual assignment to be submitted before the next session starts.