Syllabus

Financial
Management

Credit units 3 units

Facilitator Prof. Eduardus Tandelilin, Ph.D., MBA.,CWM., CSA

Master in Management, Universitas Gadjah Mada

Offic MM FEB UGM, Yogjakarta
e 5th Floor
Phone : +62 811 268 572
e.ml : eduardus.tandelilin@gmail.com

Consultation Monday: 11.30 – 13.00

Time Tuesday: 12.30 – 13.30 or with appointment

Course The course introduces students to the greater depth on finance

Descriptio especially the financial management of business corporations.
n First, we will review some fundamental concepts on financial
management. Second, we will discuss the strategic investment
decision, including cost of capital, capital budgeting and cash flow
estimation. Third, we will discuss the strategic financing decision
including long-term financial planning, capital structure and
dividend policy. Fourth, we will discuss the tactical financing
decision such as lease financing and hybrid financing. Next, we
will discuss working capital management (current asset
management and short-term financing). Finally, we will discuss
number of related topics in financial management, including
derivatives and risk management and mergers. We will also
discuss some cases in financial management to improve our
understanding on theories and practices of financial management.

Learning After completion of this course, students are expected to be able to:
Objective 1. Understand the greater depth of theory of finance,
s especially the financial management of business
corporations.
2. Solve problem and cases in financial management.
3. Analyze some special topics in financial management.
4. Analyze problems, weighing alternative solutions, and
deciding the best possible solution to a company’s problems
or opportunities in the financial context.

Book 1. Koh, Annie., Ang, Ser-Keng., Brigham, Eugene F., and

and Ehrdhart, Michael C., (2014). Financial Management:
Reading Theory and Practice, An Asia Edition., Cengage Learning,
Material Singapore.
2. Bruner, Robert F., Eades, Kenneth M.,and Schill, Michael J.
(2018). Case Study in Finance: Managing for Corporate Value
Creation. Eighth Edition, McGraw-Hill.
3. Handout and other readings.
Students’ Class participation. Students are highly expected to contribute
Responsibilities ideas, 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. Besides, students are
encouraged to raise comments on, questions, or critiques to the
other presenting groups.
Absenteeism Predicted on MM UGM regulation, students are required to
attend 100% of total lectures held. Any violations against this
rule may render the final grade penalized.

Learnin An experiential approach. Continuously and consistently,

g students are assigned to construct experiential observations on
method 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.

Case analysis. Student will be randomly distributed into groups.

Besides functioning as a discussion forum, the group is required
to submit a case write-up presentation. It is expected that the
student works diligently on these cases so as to apply theoretical
concepts to real problems and develop students’ analytical and
problem solving skills.

The length of the case write-up must not exceed ten pages of
A4- sized paper, not including figures, tables, charts, or other
appendices. The report has to be typewritten with 1.5-spaced
text system. Quantitative analysis supporting recommendations
may be attached in appendices whilst figures, table, or charts
summarizing the quantitative analyses can be included in the text.
Grading will be based on five criteria:
1. clarity
2. completeness
3. conciseness
4. correctness
5. consistency
Late submissions will not be accepted without prior approval of
the lecturer. All request for extension should be directed to
Professor Eduardus Tandelilin by e-mail at last two days before
due date for submission. Extensions will be granted for medical
reasons upon receipt of medical certificate, or in exceptional
circumstances in consultation with the individual lecturer.
Grading EXAMINATIONS. MID-TERM AND FINAL TEST PURPORT TO
EXAMINE STUDENTS’ KNOWLEDGE AND UNDERSTANDING ON
CONCEPTS LEARNT IN THE LECTURES.

WEIGHT SCORE:
Homework and assignment:
15%
Class participation: 15%
Case Analysis and presentation: 20%
Mid-Term Exam: 25%
Final Exam:
25%

Course Schedule
Meetings Chapter Topics
 An Overview of FM and the Financial Management
and the Financial
 Financial Statement, Cash Flow, and Taxes.
1 1, 2 Assignments: Questions CH1: 1-3, 1-4; Problems CH2: 2-4,
2-9.

 Analysis of Financial Statement.

2 3,4  Time Value of Money.
Assignments: Problem CH3: 3-9, 3-12; CH4: 4-21, 4-26
 Bond, Bond Valuation, and Interest Rate.
3 5,6  Risk, Return, and the Capital Pricing Model.
Assignments: Problems CH5: 5-15, 5-21; CH6: 6-7, 6-9
 Stocks, Stock Valuation, and Market.
 Financial Options and Applications in Corporate Finance.
4 7,8 Assignments: Problems; CH7: 7-10, 7-15; CH8: 8-4, 8-6
Case 1: Larry Puglia and the T. Rowe Price Blue Chip Growth
Fund (Bruner ..Case 3)
 The Cost of Capital
 The Basic of Capital Budgeting: Evaluating Cash Flow
5 9,10 Assignments: Problems; CH9: 9-10, 9-12; CH10: 10-16, 10-18.
Case 2: H.J. Heinz: Estimating the Cost of Capital in
Uncertain
Times (Bruner
Cash Flow ..Case 12) and Risk Analysis.
Estimation
 Financial Planning and Forecasting Pro Forma
6 11,12 Financial Statement
Assignments: Problems CH11: 11-7, 11-11; CH12: 12-7, 12-9
Case 3: Fonderia del Piemonte S.p.A. (Bruner ... Case 19)
 Corporate Valuation, Value Based Management,
7 13 and Corporate Governance
Assignments: Problems CH13: 13-4, 13-6, 13-8
Case 23: The Proctor and Gamble Company:
Investment in Crest Whitestrips Advanced Seal.
MID TERM EXAMINATION
  Distribution to Shareholders: Dividends and Repurchases
14 Assignments: Problems CH14: 14-6 14-7, 14-7, 14-10.
8
 Capital Structure Decisions
9 15
Assignments: Problems CH15: 15-5, 15-6, 15-9
 Working Capital Management
10 16 Assignments: Problems CH16: 16-8, 16-14, 16-16
Case 4: Rockboro Machine Tools Corporation. (Bruner ....
CaseMultinational
26). Financial Management
11 17,18  Lease Financing
Assignments: Problems CH17: 17-11, 17-12, 17-14; CH18: 18-
2, 18-3, 18-5
 Preferred Stock, Warrants, and Convertibles
12 19 Assignments: Problems CH19: 19-2, 19-4, 19-6
Case 5: Nokia OYJ: Financing the WP Strategic Plan (Bruner..
CaseIPO,
34) Investment Banking & Financial Restructuring
13 20,21  Mergers, LBOs, Divestitures, and Holding Company
Assignments: Problems CH20: 20-2, 20-3, 20-5; CH21: 21-1,
21-2, 21-4
Case 6: Horizon Lines, Inc.(Bruner.. Case 34)
 Bankruptcy, Reorganization & liquidation
14 22,23  Derivative and Risk Management
Assignments: Problems CH22: 22-1, 22-3, 22-3; 23-3, 23-4

Final Examination