CO1109

Business and Financial Computing

Lecture 1. Module Overview and Introduction to Business Fundamentals

Dr. Bo Yuan
b.yuan@leicester.ac.uk

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 Learning Outcomes
On successful completion of this module, you should be able to:

○ Explain some of the fundamental concepts, terminology and processes of

the business/financial domain;
○ Explain the categories and functions of business and information systems
and applications and solve simple problems;
○ Outline the functional and architectural properties of these systems;
○ Explain the different roles and functions of IT professionals within
organisations.
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CO1109 – Business and Financial Computing

Module Overview
Basic business and financial concepts Business Financial Management
Type of business Accounting, Assets/Liabilities, Balance Sheet,
Organizational functions and structures Cash Flow Statement, Key Financial Ratio

Business process Funding Sources and Capital Budgeting

Business Information System Business Intelligence and IT Roles/Process

Technology elements, Architectural paradigms Business intelligence, Data analysis
Enterprise system architecture IT Governance and operations, IT related
Enterprise applications: ERP, CRM, SRM processes, IT project management

CO1109 – Business and Financial Computing

About myself
Professional Experience
○ Lecturer in Computing Science since 2019
○ Industrial KTP Projects (in the domain of Business Intelligence and Data Science)
○ Data scientist at retail industry 2017 – 2019

Research Interests
○ Data Science and Business Intelligence
○ Artificial Intelligence and Machine Learning
○ Big Data Analytics – retail, social media, IoT, computer networks…
○ Distributed computing and networks

CO1109 – Business and Financial Computing

How you will learn and be
assessed

CO1109 – Business and Financial Computing

Indicative Delivery Format
Tutorials: Fridays 10:00-12:00 (UK time) starts next
Lectures: Tuesdays 10:00-12:00 (UK time) week!
Activity Time (mins) Activity Time (mins)
Highlights or recap 5 - 10 Instructions and guidance 15

Teaching session part 1 45 Tutorial session 1 35

Break 10 Break 10
Teaching session part 2 45 Tutorial session 2 30
Activity, Quiz and QA 10 Solution review/demo and QA 30

Lectures and tutorials are all delivered on Zooms unless announced otherwise
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Assessment
No. Assessment Description Weight % Due
1 Coursework 1 20 14 April
2 Coursework 2 20 26 May
3 Examination 60 TBC (June Exam week)

Important notes
 The assignment should be carried out independently. Anything you submit for credit is expected to be your own work
○ OK to exchange ideas, but do NOT copy detailed solutions
○ Attempt to gain credit for work you did not do is misconduct
 Plagiarism will be checked by computer software

CO1109 – Business and Financial Computing

Module Logistics Communications
In-class QA
Email
One-to-one meeting (Teams)
Teaching and Learning feedback

Study Materials in Blackboard

Announcements
Lecture slides, tutorials, solutions
Assignments and assessment information
Lectures will be recorded for enhancing
learning purpose only

Attendance
Turn up on time
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Complete activities and exercises each week
Submission on time
CO1109 – Business and Financial Computing
Basic Requirements
Attendance at lectures and The homework or activities for
tutorials is compulsory each lecture shall be completed in
advance BEFORE next lecture

Enjoy the Course!

Lecture materials are essential

for you to completing tutorials
and practical tasks 9

CO1109 – Business and Financial Computing

Suggested Text (optional reading)

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What you can expect from me
Additional help or personal tutorial beyond the Help with conceptual issues
taught sessions Can you go over the xxx concepts again
Ad hoc individual meetings after the session How to use xxx principles

Clarification of the exercises and assignments

What is needed to install or configure Lectures: An emphasis on concepts, rather
Where to find additional tutorial than specific tools
What does xyz mean in the assignment Tools change, but concepts persist

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Staff Contact
• Module Convenor: Dr Bo Yuan
• Email: b.yuan@leicester.ac.uk
• Meeting by appointment
• Additional support: Teams/Zoom for remote meetings/personal support

Module TA: Miss Nicole Yap

o Email: ny50@leicester.ac.uk
o Tutorial and coursework support

Module TA: Mr. Muhammad Saad Zia

o Email: msz6@leicester.ac.uk
o Tutorial and coursework support

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CO1109 – Business and Financial Computing

Introduction to Business Fundamentals

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Key Topics
Main types of business
How a company/corporation is managed and controlled
The financial cycle and financial department’s place
Common financial reports

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The Purpose of Business
The economic problem
○ There exist unlimited wants but limited resources to produce the goods or services to satisfy
those wants

Business combines factors of production to make products (goods and services)

to satisfy people’s needs/wants
○ Input: land, labour, capital, enterprise
○ Output: products (goods or services)
○ Purpose: to satisfy people’ wants but ultimately to create wealth for its owner (or owners)

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CO1109 – Business and Financial Computing

Types of Business
Sole Trader (Sole Proprietorship)
○ The firm can have only one owner
○ There is no separation between the firm and the owner

Examples
○ Trades people: plumbers, electricians, or gardeners.
○ Freelance workers: graphic designers, web designers, photographers, or artists.
○ Independent contractors: tutors, food delivery drivers.
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CO1109 – Business and Financial Computing

Types of Business
Partnerships
○ More than one owner
○ General partners (management with unlimited liability) and limited partners (non
management)
○ The partnership ends on the death or withdrawal of any single partner
Examples
○ Firm of accountants
○ Firm of solicitors
○ Firm of architects
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CO1109 – Business and Financial Computing

Types of Business
Limited Liability Companies or Corporations
○ Limits the owner’s liability to their investment
○ Owners are not allowed to trade their shares on an organized exchange
○ Ltd stands for limited

Ltd Examples
○ Europe Food Ltd
○ First Call Contract Services Ltd
○ QS Recruitment Ltd
Plc Examples
Public Limited Companies Google Plc
○ Business that are legally allowed to sell its shares to the public Baidu Plc
○ Plc stands for public limited company Royal Mail Plc 18

CO1109 – Business and Financial Computing

Summary: company types
Business type Risk Ownership Limited
Liability
Sole trader Carried by sole owner One owner No

Partnership Carried by all Several partners No

partners
Private Limited Shareholders up to Shareholders Yes
Company their original May be a few or many, but
investment shares cannot be sold to
public
Public Limited Shareholders up to Shareholders - many Yes
Company their original
investment
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CO1109 – Business and Financial Computing

Corporations
A corporation is a separate legal entity from their owners
○ It can enter into contracts, acquire assets, incur obligations
○ A corporation is solely responsible for its own obligations
○ The owners of a corporation are not liable for any obligations the corporation enters into

Ownership of a Corporation
○ An owner of a share of stock in the corporation is known as a shareholder, stockholder, or equity holder
○ Shareholders are entitled to dividend payments

Management Team
○ Board of Directors
○ Chief Executive Officer (CEO) 20
○ Chief Information Officer (CIO)

CO1109 – Business and Financial Computing

Organisation and Management
Organisational structure
○ Levels of management and division of responsibilities

Narrow span of control Wide span of control 21

CO1109 – Business and Financial Computing

Organisational Structure – Apple

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Apple Organizational Structure
https://research-methodology.net/apple-organizational-structure-a-hierarchical-structure-that-may-change-in-near-future/

CO1109 – Business and Financial Computing

Business Process
A business process is an ongoing collection of related business activities that
create a product or a service of value to the organization, its business partners,
and/or its customers.

A process is comprised of three fundamental elements:

○ Inputs: Materials, services, and information that fl ow through and are transformed as a
result of process activities
○ Resources: People and equipment that perform process activities
○ Outputs: The product or a service created by the process

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Business Process – Airline Company Example

• Rectangles (steps) are activities that are

performed by process resources (reserve
seats, issue e-ticket).

• Diamond-shaped boxes indicate decisions that

need to be made (seats available?)

• Arrows are used as connectors between

steps; they indicate the sequence of activities.

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Business process for ordering e-ticket from airline Web site.
Image from Introduction to Information System Supporting and Transforming Business
CO1109 – Business and Financial Computing
Examples of Business Process
Human Resources Processes
○ Managing employee hiring
○ Applying disability policies
○ Handling employee orientation
○ Managing files and records
○ Applying healthcare benefits
○ Managing pay and payroll

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Examples of Business Process
Marketing Business Processes
○ Managing post-sale customer follow-up
○ Applying copyrights and trademarks
○ Using customer satisfaction surveys
○ Managing customer service
○ Handling customer complaints

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Examples of Business Process
Management Information Systems Processes
○ Management Information Systems Processes
○ Antivirus control
○ Computer security issues incident reporting
○ Computer user/staff training
○ Applying disaster recovery procedures
○ Applying electronic mail policy
○ Generating Internet use policy

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The Financial Cycle
In the financial cycle
Financial institutions:
○ People invest and save their money
o Move funds from savers to
○ Through loans and stock, that money flows borrowers
to companies who use it to fund growth o Move funds through time
through new products, generating profits o Help spread out risk-
and wages bearing
○ The money then flows back to the savers
and investors

Material from Fundamental of corporate finance

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Business Finance Department
Finance departments have following responsibilities
○ Recording financial transactions, such as payment, and sales revenue
○ Producing accounting information for managers
○ Financial accounting for outsiders
○ Making important financial decisions

Stockholders own a corporation but rely on financial managers to actively

manage the corporation

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Corporation Profit vs Cost Centres
Profit Centres:
○ a.k.a. Units with Line Responsibilities or Business Units
○ Implement the core mission of an organization and generate profit directly (e.g. sales,
trading)
Cost Centres:
○ a.k.a. Units with Staff Responsibilities or Support Units
○ Help business units accomplish their objectives, do not directly generate profit(e.g. human
resources, legal, procurement).

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CO1109 – Business and Financial Computing

Finance Basics
Finance: Management (Raising, Custody and Spending) of Money
Long-Term Sources of Money
○ Money invested by Shareholders (=Share Capital)
○ Borrowing from Banks and other sources (=Liabilities)
○ Retained earnings (i.e., profits)

Share Capital + Retained Earnings = Stockholders’ Equity

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CO1109 – Business and Financial Computing

Finance Basics
Assets: The resources owned/controlled by the company
○ Office space, computers, printers, company cars
Liabilities: amounts owed to lenders and other creditors
○ Non-current liabilities: those repayable more than one year in the future
○ Current liabilities: those repayable in one year or less

Share Capital + Long Term Borrowing = Capital Employed

○ Capital employed is the total capital the company has

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Finance Basics
Capital expenditures (CAPEX)
○ Money spent in order to create future benefits for an organization
○ i.e. purchasing new fixed assets (e.g. equipment, property, buildings) or extending the value (useful
life) of existing assets beyond the taxable year – (non-current assets)

There also exist current assets

○ used up in less than one year (e.g. inventories of products, ‘trade receivables’ (trade debtors),
○ i.e. amounts due from customers for goods or services which have been sold on credit

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Finance Basics
An Operating Expense (OPEX) is any on-going cost for operating the business (e.g. property rent, office
stationary, utility bills, travel expenses, personnel salaries).
○ For example, the purchase of a printer is a CAPEX cost whereas the annual expenses for paper, toner,
power and the maintenance of the printer are OPEX costs.
○ Other common OPEX examples are the cost of personnel and facility expenses (e.g. rent, electricity).

Fixed capital: the part of a company’s money (capital) invested in non-current (long-term) assets.

Working capital: the part of a company’s capital invested in net current assets (current assets - current
liabilities).

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CO1109 – Business and Financial Computing

Key takeaways
The purpose of business
Common type of business
The role of business finance
Three main sources of long-term money

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CO1109 – Business and Financial Computing

What’s next
• Tutorial starts next week, 3rd March using the same Zoom ID
• Next Lecture: Introduction to Financial Statements
• Email me if you have any questions: b.yuan@leicester.ac.uk

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CO1109 – Business and Financial Computing

 Any Questions?

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CO1109 – Business and Financial Computing