1

School of Business and Economics

Department of Accountancy
Downtown Campus

SYLLABUS

COURSE DETAILS
Course No. : AC 4103 Professor:
Course Title : Financial Management Office: Department of Accountancy
Credit Units : 3
Pre-requisites : AC 3104: Financial Markets and Basic Finance Contact No: 230-0100 loc. 513
Term : BSMA, BSAIS: 2nd Semester, SY 2020-2021; Email Add:
BSA, BSIA: 1st Semester, SY 2021-2022
Schedule :

Course Description

The course Financial Management provides 3rd year undergraduate Management Accounting and Accounting Information System students and 4th year undergraduate
Accounting and Internal Audit students an extensive and stimulating look into financial management – the framework of which is designed in such a way that enables the
students to understand and analyze topics in a clear and concise manner. The course will cover four major groups of topics: (1) Fundamental Concepts and financial forecasting,
(2) Investing in Long-Term Assets, (3) Capital Structure and Dividend Policy, (4) Hybrid Financing, and (5) Working Capital Management.
Under fundamental concepts and financial forecasting, the students will be introduced to analysis of financial statements with a focus on ratio analysis and evaluating a firm’s
strengths and weaknesses using liquidity, asset management efficiency, debt management efficiency, profitability, and market value performance ratios. This is followed by
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financial planning and forecasting which encompasses the preparation of projected financial statements to assess the firm’s anticipated performance, estimate the effects of
proposed operating changes, and anticipate the firm’s future financing needs using the pro-forma financial statement method or AFN equation method.
Under investing in long-term assets, the discussion will encompass four topics: (1) the calculation of cost of capital which includes the determination of different capital
component costs; (2) the basics of capital budgeting, which incorporate valuable techniques in making major long term business decisions using non-discounted and discounted
capital budgeting methods; (3) cash flow estimation and risk analysis as a necessary and integral part in evaluating long-term projects; as well as (4) real options and other
topics in capital budgeting, which recognizes the inevitability of uncertainties surrounding long-term investment decisions and incorporating these uncertainties in decision
making using capital budgeting techniques, particularly the NPV method.

Under capital structure and dividend policy, the discussion will comprise of two topics: (1) capital structure and leverage, which focuses on the consideration of quantitative
and qualitative factors that influence capital structure decisions and tradeoffs when determining the target capital structure, and the determination of how much debt to use as
financing means to obtain the target capital structure; and (2) distributions to shareholders dividends and share repurchases, which focuses on dividend policy and addresses
key issues such as how much income should be distributed to shareholders? How should the income be distributed? How stable should the distribution be? The decision
largely takes into account investors’ preferences among other factors. Moreover, this topic also determines how share repurchases and stock splits affect shareholder wealth.

The fourth major topic, hybrid financing, focuses on the valuation of different types of hybrid securities – preferred stock, leases, warrants, and convertibles. Finally, the last
topic is working capital management. Working capital management consists of two subtopics, namely: (1) managing current assets, and (2) financing current assets. Students
will be introduced into the significance of working capital in business operations and how the proper amount of each current asset, as well as how a firm’s credit policies can
affect the firm’s profitability and stock prices. Furthermore, sources of funding current assets are identified and its costs are measured to determine the viability of such funding.
Managing current assets will focus on the management of cash, marketable securities, inventories, and receivables, while financing current assets will focus on the cost of
financing using payables, bank loans, revolving credit agreement, and commercial paper.

Program Educational Outcomes

Three to five years after graduation, the Carolinian management accounting professional graduate will become:

PEO#1 A management accounting professional who can build a career at national and international levels.

A management accounting professional who is competent and capable in creating, managing, and distributing wealth whether in manufacturing, merchandising,
PEO#2
and service related enterprise.

PEO#3 A management accounting professional who contributes his/her expertise to the industry, professional body, and society.
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Program Learning Outcomes

Each course has specific Course Level Student Learning Outcomes (SLOs) that will be achieved through the curriculum designed for the course. The cumulative achievement
of all Course level SLOs will result in the achievement of Ten (10) Program Level Student Learning Outcomes as listed below.
Upon completing the BS Management Accounting program, graduates will demonstrate the following:

PEOs
Domain Domain Definition Skills
PEO#1 PEO#2 PEO#3

The ability to acquire and apply knowledge of science, mathematics, business and
PO#1: Business Knowledge economics and to understand key terms, facts and processes related to Finance and Cognitive
Accounting.

The ability to verbalize and articulate business information to be used by financial

PO#2: Communication/Reporting Psychomotor
information users in making economic decisions.

The ability to direct and influence others towards a common goal and to recognize Affective/
PO#3: Leadership/Teamwork
individual performance and work with others towards achieving a common goal. Psychomotor

PO#4: Multi-disciplinary Teams The ability to function in collaboration with other disciplines. Psychomotor

The ability to be professionally competent, noble in character, sensitive to the

PO#5: Witness to the Word Gospel's mission and adhere to the Code of Professional Ethics for the accounting Affective
profession.

The ability to demonstrate personal and intellectual autonomy and information

PO#6: Life-long Learning Affective
literacy.

The ability to embrace the diversities and complexities of the world across
disciplines and perspectives, at the same time preserve and promote “Filipino Cognitive/
PO#7: Global Citizenship historical and cultural heritage”; to demonstrate corporate citizenship, social Affective/
responsibility, and ethical practices in performing functions as a professional Psychomotor
management accountant.
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The ability to undertake an in-depth study of accounting, tax, business law, and
PO#8: Research Cognitive
auditing issues.

The ability to analyze and interpret financial and business risks, identify and
analyze problems related to management accounting issues as basis for solutions
PO#9: Technical Competency and recommendations, and render professional judgment on the preparation of Cognitive
external and internal reports based on applicable standards and practices.
\

The ability to exercise discretion in the analysis and interpretation of management

PO#10: Professional Judgment accounting issues, both local and international, and present options in resolving Cognitive
emerging and relevant challenges related to management accounting.

Course Learning Outcomes

Program Learning Outcomes (POs)

Upon completion of the course, students should be able to:
PO#1 PO#2 PO#3 PO#4 PO#5 PO#6 PO#7 PO#8 PO#9 PO#10
Identify, describe, discuss, differentiate, and theorize key and
emerging concepts and issues of bonds, stocks, cost of capital,
CO#1:
capital budgeting, capital structure, dividend policy, and hybrid
financing.

Explain the key principles and importance of the topics covered

CO#2: and its relationship and relevance to ethics, to other disciplines,
and to the industry both in local and global setting.

Compute and solve problems, using appropriate managerial

CO#3:
concepts covered in this course under different business scenarios.

Apply relevant macroeconomic concepts that affect bond and

stock valuation, cost of capital, capital budgeting decision
CO#4:
analysis, hybrid security valuation, and managerial decisions
involved in determining capital structure and dividend policy.
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Reflect and interpret the numerical figures measured from solving

problems, comparing the figures to local and international
CO#5:
benchmark standards, using them as basis for planning and
decision making.

Course Structure
COURSE ASSESSMENT TEACHING AND LEARNING
TOPIC INTENDED LEARNING OUTCOMES
OUTCOMES TASKS ACTIVITIES
I. Course Orientation (1.5 hours) CO#1, CO#2 1. Review of the related concepts, principles, 1. Group 1. Discussion on the course
A. USC Vision and Mission Statement. formulas, and other matters that will relate to the activity objectives, requirements,
B. SBE and Department of Accountancy course. grading system, and house
Aims. rules.
C. Duties and responsibilities of a 2. Group game / Review
student. Questions – Q&A
D. Classroom rules and policies.
E. Expectations from the subject and the
teacher.
F. Course Overview

II. Analysis and Interpretation of 1. Explain the rationale of performing financial 1. Short quiz 1. Assign an advanced reading
Financial Statements (3 hours) statement analysis. 2. Seatwork 2. Lecture
A. Uses, reasons, and limitations of 2. Describe the two types of comparisons when 3. Oral exam discussion/powerpoint
financial statement and ratio analysis. using financial ratios. 4. Course presentation
B. Types of comparisons using ratio 3. Prepare and interpret financial statements in preparation 3. Discussion of illustrative
analysis. comparative and common-size form. assignment examples
C. Leverage Principle and ratios 4. Enumerate and discuss the five major categories 5. Group 4. Guided practice exercises
D. Main categories of ratios that are of of ratios as well as their significance. 6.
activity 5. Seatwork – problem based
vital importance to users of financial 5. Compute and interpret financial ratios that learning
statements. would be useful to a common stockholder, 6. Team-based exercises
E. Return on Equity, Return on Capital short-term, and long-term creditor. 7. Group game – quizbowl
Employed, & Economic Value 6. Explain the problems of Return on Equity
Added as performance measurement (ROE) if it is used as the sole measure of
tools. performance.
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F. Computation, significance, analysis, 7. Explain the concept of Economic Value Added

and interpretation of each ratio. (EVA) and its advantage when it is being used
G. Reasons for Benchmarking. to gauge performance.
H. Analysis and decision making using 8. Compute the common financial ratios, explain
Du Pont Equation, relationship their function, analyze and interpret the firm’s
between ROA and ROE. ratios in comparison to the past (trend analysis)
I. Qualitative factors to be considered or in comparison with its peers (benchmarking).
when making financial decisions. 9. Explain the purposes of benchmarking
10. Discuss the purpose of the Du Pont Equation
and make decisions based on the output derived
from the Du Pont Equation.
11. Interpret trend analysis from a graph.
12. Enumerate and explain the uses and limitations
of ratio analysis.
13. Enumerate and discuss other factors that
managers have to look into apart from
numerical analysis.

III. Financial Planning and Forecasting 1. Explain the need for financial planning and 1. Short quiz 8. Assign an advanced reading
(3 hours) forecasting. 2. Seatwork 9. Lecture
A. Steps of creating a financial plan 2. Enumerate and describe the different plans used 3. Oral exam discussion/powerpoint
B. Creation of sales forecast using the by managers and their various components. 4. Course presentation
percent of sales method 3. Enumerate the steps in creating a financial plan. preparation 10. Discussion of illustrative
C. Creation of forecasted income 4. Discuss the rationale and computations for assignment examples
statement and balance sheet using forecasted sales using the percent of sales 5. Group 11. Guided practice exercises
pro-forma financial statement method. 6.
activity 12. Seatwork – problem based
method. 5. Create a forecasted income statement and learning
D. Computation of Additional Funds forecasted balance sheet. 13. Team-based exercises
Needed (AFN). 6. Compute for Additional Funds Needed (AFN). 14. Group game – quizbowl
E. Key assumptions when using the 7. Enumerate the key assumptions of the AFN
AFN equation method rather than the equation method.
pro-forma financial statement 8. Compute amounts for balance sheet items using
method. simple linear regression and excess capacity
F. Other techniques for forecasting adjustment.
items in financial statements 9. Explain how excess capacity would affect
various forecasted ratios
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G. Effect of excess capacity on 10. Explain how changes in income statement

forecasted financial ratios; effect of and/or balance sheet items would affect AFN.
changes in financial statement items
on AFN.

IV. The Cost of Capital (3 hours) CO#1, CO#2, 1. Describe weighted average cost of capital 1. Short quiz 1. Assign an advanced reading
A. Weighted Average Cost of Capital as CO#3, CO#4, (WACC) and explain why WACC is used in 2. Seatwork 2. Lecture
“the” rate used in capital budgeting. and CO#5 capital budgeting. 3. Oral exam discussion/powerpoint
B. Four component costs of capital. 4. Course presentation
2. Enumerate and describe the component costs of
C. Four approaches of computing cost preparation 3. Discussion of illustrative
of retained earnings. capital. assignment examples
D. Computation of cost of common 3. Measure the costs of different capital 5. Group 4. Oral recitation
stock. components using different approaches. activity 5. Guided practice exercises
E. Determination whether to use cost of 4. Apply retained earnings breakpoint concept in 6. Summative 6. Seatwork – problem based
retained earnings or cost of common computing for WACC. long exam learning
stock through the retained earnings 5. Measure the firm’s WACC by combining the 7. Team-based exercises
breakpoint concept. 8. Group game – quizbowl
different component costs of capital and
F. Calculation of WACC.
G. Factors affecting WACC: incorporating risk.
H. Risk-adjusted Cost of Capital and 6. Enumerate the factors that affect the WACC.
Hurdle Rate. 7. Enumerate the problems that firms face with
I. Problems of cost of capital estimates. cost of capital estimates.

V. The Basics of Capital Budgeting (6 CO#1, CO#2, 1. Explain the importance of capital budgeting. 1. Short quiz 1. Assign an advanced reading
hours) CO#3, CO#4, 2. Enumerate and explain the uses of capital 2. Seatwork 2. Lecture discussion/powerpoint
A. Importance of capital budgeting CO#5 budgeting in decision making. 3. Oral exam presentation
when making long-term decisions. 4. Course 3. Discussion of illustrative
3. Enumerate the different capital budgeting
B. Uses of capital budgeting. preparation problems
methods: Payback period, Payback reciprocal, assignment 4. Oral recitation
C. Different capital budgeting methods.
D. The advantages and disadvantages of Payback bailout, Accounting rate of return 5. Group 5. Team-based exercises
the different capital budgeting (ARR), Discounted payback period, Net present activity 6. Group game – quizbowl
methods. value (NPV), Profitability index, Internal rate of
E. Computation of capital budgeting return (IRR) and Modified internal rate of return
problems and making decisions for (MIRR)
independent and mutually exclusive
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projects using different capital 4. Enumerate and explain the advantages and
budgeting decision methods disadvantages of capital budgeting criteria for
F. Multiple internal rate of return both non-discounted and discounted methods of
problem and how to overcome it.
capital budgeting.
G. NPV profile graph.
H. Fisher rate or crossover rate 5. Apply the non-discounted and discounted
I. Sensitivity analysis and Post-audit of capital budgeting criterial for decision making.
capital projects. 6. Resolve the problem of MIRR.
7. Construct the NPV profile and compute for the
Fisher or Crossover rate using the calculator
method and graphical method.
8. Explain why NPV is the best capital budgeting
tool.
9. Explain how the NPV overcomes problems
inherent in the other capital budgeting methods.
10. Perform sensitivity analysis and post-audit of
investment projects.

VI. Cash Flow Estimation and Risk CO#1, CO#2, 1. Explain why cash flow estimation and risk 1. Short quiz 1. Assign an advanced reading
Analysis (4.5 hours) CO#3, CO#4, analysis is an essential part in capital budgeting 2. Seatwork 2. Lecture
A. Conceptual issues surrounding cash and CO#5 analysis and explain the conceptual issues in 3. Oral exam discussion/powerpoint
flow estimation. cash flow estimation. 4. Course presentation
B. Identification and estimation of 2. Identify “relevant” cash flows that should be preparation 3. Discussion of illustrative
relevant cash flows. included in a capital budgeting analysis. assignment examples
C. Capital Budgeting risks that affect 3. Compute a project’s relevant cash flows and 5. Group 4. Oral recitation
cash flows: incorporate them into time line format that can activity 5. Guided practice exercises
D. Stand-alone risk be used to solve capital budgeting problems 6. Summative 6. Seatwork – problem based
E. Risk measurement and WACC 4. Describe and measure the risks involved in long exam learning
adjustment. capital budgeting. 7. Team-based exercises
F. Scenario analysis. 5. Explain how risk is measured and use this 8. Group game – quizbowl
G. Net present value for mutually measure to adjust the firm’s WACC to account
exclusive projects with unequal lives. for differential project riskiness.
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6. Perform scenario analysis to determine the

possible effects to capital budgeting metrics
when various scenarios are presented.
7. Compute for the NPV of mutually exclusive
projects with unequal lives.

MIDTERM DEPARTMENTAL EXAMINATION

VII. Real Options and Other Topics in CO#1, CO#2, 1. Explain what real options are and their value. 1. Short quiz 1. Assign an advanced reading
Capital Budgeting (3 hours) CO#3, CO#4, 2. Explain how real options influence capital 2. Seatwork 2. Lecture
H. Relevance of real options in capital and CO#5 budgeting and how they can be analyzed. 3. Oral exam discussion/powerpoint
budgeting. 3. Explain how projects’ NPV are affected by the 4. Course presentation
I. Effect of project NPV and overall size of the firm’s total capital budget and how to preparation 3. Discussion of illustrative
WACC due to capital budget size. deal with this situation. assignment examples
J. Incorporating real options into capital 4. Apply real option analysis to evaluate projects. 4. Oral recitation
budgeting analysis (specifically the 5. Recognize the inevitability of capital rationing 5. Guided practice exercises
net present value method). when resources are scarce. 6. Seatwork – problem based
K. Capital rationing when resources are 6. Determine which projects should be accepted learning
scarce and related problems. when resources are scarce.
L. Incorporating real options into post- 7. Describe post-audit and explain its relevance in
audit analysis. capital budgeting decisions when real options are
involved.

VIII. Capital Structure and Leverage (3 CO#1, CO#2, 1. Differentiate business risk from financial risk. 1. Short quiz 1. Assign an advanced reading
hours) CO#3, CO#4, 2. Explain the effects that debt financing has on the 2. Seatwork 2. Lecture
A. Target capital structure and stock and CO#5 firm’s expected return and risk. 3. Oral exam discussion/powerpoint
price maximization. 4. Course presentation
3. Compute for the degree of operating leverage,
B. Business risk versus financial risk. preparation 3. Discussion of illustrative
C. Degree of operating, financial, and degree of financial leverage and degree of assignment examples
combined leverage combined leverage. 5. Group 4. Oral recitation
D. Hamada equation 4. Calculate Beta using the Hamada Equation activity 5. Guided practice exercises
E. Effect of debt financing on a 5. Determine a firm’s target and optimal capital 6. Seatwork – problem based
company’s expected return and structure using analytical frameworks. learning
measure of risks. 6. Explain the capital structure theory. 7. Team-based exercises
8. Group game – quizbowl
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F. Computation of target or optimal 7. Explain why firms in different industries tend to

capital structure. have different capital structures.
G. Capital Structure Theories. 8. Enumerate and explain the factors influencing
H. Symmetric versus Asymmetric
capital structure decisions.
Information (Signaling Theory)
I. Factors influencing capital structure 9. Analyze variations in capital structure.
decisions
J. Variations of capital structure across
industries and across firms.

IX. Distribution to Shareholders: CO#1, CO#2, 1. Discuss the purpose of dividend policy and how 1. Short quiz 1. Assign an advanced reading
Dividends and Share Repurchases (3 CO#3, CO#4, such can affect shareholder wealth. 2. Seatwork 2. Lecture
hours) and CO#5 2. Explain the importance of dividend policies. 3. Oral exam discussion/powerpoint
A. Importance of dividend policy. 3. Enumerate and explain the dividend policy 4. Course presentation
B. Theories of dividend policy. theories. preparation 3. Discussion of illustrative
C. Different effects of stock price and 4. Describe the effects of stock price based on assignment examples
cost of equity when dividends are different dividend payment scenarios. 5. Group 4. Oral recitation
paid illustrated via graphical analysis. 5. Describe the effects of cost of equity based on activity 5. Guided practice exercises
D. Issues influencing optimal dividend different dividend payment scenarios. 6. Summative 6. Seatwork – problem based
policy. 6. Explain the concept and importance of dividend long exam learning
E. Importance of dividend stability and stability. 7. Team-based exercises
its role in increasing shareholder 7. Compute how much dividends should be paid 8. Group game – quizbowl
wealth. using the residual dividend model.
F. Factors determining the optimal 8. Enumerate and explain the advantages and
payout ratio and dividend policy disadvantages of the residual dividend model.
decisions. 9. Compute dividend payout ratio based on
G. Steps in setting the dividend policy. different net income scenarios.
H. Computation of dividend payout ratio 10. Explain the effects of dividend policy under
using the residual dividend model. different investment opportunity scenarios.
I. Various advantages and 11. Describe the dividend payment procedures.
disadvantages of the residual 12. Enumerate and describe the four important
dividend model. dividend payment dates.
J. Changes in dividend payout when 13. Discuss the concept and purpose of dividend
investment opportunities change. reinvestment plans, and low-regular-dividends-
K. Dividend payment procedures and plus-extras.
Dividend dates
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L. Types of Dividend Reinvestment 14. Discuss stock repurchases and stock splits and
Plan. explain their effects using both theoretical and
M. Advantages, disadvantages, & effects practical applications.
of stock repurchases and splits.
N. Comparison between stock dividends
and stock splits.

X. Hybrid Financing: Preferred Stock, CO#1, CO#2, 1. Explain what hybrid financing is. 1. Short quiz 1. Assign an advanced reading
Leasing, Warrants, and Convertibles (4.5 CO#3, CO#4, 2. Enumerate the reasons why companies are 2. Seatwork 2. Lecture
hours) and CO#5 offering hybrid securities to investors, in 3. Oral exam discussion/powerpoint
A. Reasons for issuing hybrid securities addition debt and equity securities. 4. Course presentation
B. Preferred Stock, its characteristics, 3. Enumerate the differences between hybrid preparation 3. Discussion of illustrative
valuation, advantages and securities and debt and equity securities. assignment examples
disadvantages. 4. Enumerate the common kinds of hybrids. 4. Oral recitation
C. Lease, the parties involved, its 5. Describe the characteristics of preferred shares 5. Guided practice exercises
characteristics, valuation, advantages and their risk profile before and after tax. 6. Seatwork – problem based
and disadvantages 6. Discuss the advantages and disadvantages of learning
D. Warrants, its characteristics, preferred issuing preferred shares
valuation, advantages and 7. Enumerate and describe the parties in a lease
disadvantages. and the two forms of leases.
E. Convertibles, its characteristics, 8. Discuss the effect of leasing decisions to a
valuation, advantages and company’s leverage and factors affecting
disadvantages. leasing decisions.
9. Enumerate the criteria when a lease must be
classified as a capital lease.
10. Perform computations that help decide whether
it is better to lease or to borrow and buy.
11. Enumerate the factors that affect leasing
decisions.
12. Describe the nature of warrants, why they are
issued, and when investors are likely to exercise
warrants.
13. Compute for the value of warrants.
14. Illustrate and describe the effects on old
shareholder wealth if warrants are mispriced,
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and discuss the dangers when warrants are

mispriced.
15. Describe the nature of convertibles, why they
are issued, and when investors are likely to
exercise the convertibles.
16. Compute for conversion ratio, conversion price,
conversion value, straight debt value, and
component cost of convertibles.
17. Enumerate the advantages and disadvantages of
issuing convertibles.
18. Compare and contrast warrants from
convertibles.

XI. Working Capital Management (6 CO#1, CO#2, 1. Explain what working capital is and why this is 1. Short quiz 15. Assign an advanced reading
hours) CO#3, CO#4, needed by firms to sustain their operations. 2. Seatwork 16. Lecture
A. Effect of net working capital on and CO#5 2. Explain how different amounts of current assets 3. Oral exam discussion/powerpoint
firms’ profitability and stock prices. and current liabilities affect firms’ profitability
4. Course presentation
B. Working Capital Investment Policies. preparation 17. Discussion of illustrative
and thus their stock prices. assignment examples
C. Current Asset Financing Policies. 3. Describe, compare, and contrast the current 5. Group 18. Guided practice exercises
D. Cash Management, Cash Conversion asset investment and financing policies. activity 19. Seatwork – problem based
Cycle and related computations, and 4. Explain how the cash conversion cycle is 6. Summative learning
Preparation of Cash Budget. determined and how it is used in working long exam 20. Team-based exercises
E. Marketable Securities Management. capital management. 21. Group game – quizbowl
F. Inventory Management. 5. Compute for the inventory conversion period,
G. Receivables Management. average collection period, payables deferral
H. Procedures in working capital period, and cash conversion cycle;
investment policies. 6. Compute for disbursements, collections, and net
I. Policies affecting the firm’s sales and float.
profitability. 7. Prepare a cash budget and explain its relevance
J. Payables: Computation of cost of in working capital management.
trade credit, (free trade credit and 8. Explain the purpose of a lockbox system and
costly trade credit). determine whether it is feasible for companies
to implement a lockbox system.
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K. Bank loans, revolving credit 9. Compute for money market yields.

agreement, and commercial paper. 10. Determine Economic Order Quantity (EOQ),
L. Secured Loan versus Unsecured the minimum cost of holding and ordering
Loan inventory, and the reorder point.
11. Construct an aging schedule.
12. Explain how companies decide on the amount
of each current asset to hold.
13. Explain how companies set credit policies and
explain its effect on sales and profits.
14. Describe how the costs of trade credit, bank
loans, and commercial paper are determined and
how that these impact decisions for financing
working capital.
15. Compute for the cost of trade credit, specifically
free trade credit and costly trade credit.
16. Compute for cost of revolver in revolving credit
agreement, the cost of bank loans, and effective
annual interest rate for commercial papers.
17. Explain how companies use security to lower
their costs of short-term credit.

FINAL DEPARTMENTAL EXAMINATION

Educational Resources
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A. Book
Brigham, E.F. & Houston, J.F. (2013). Fundamentals of Financial Management (13th ed.). Ohio, USA: South-Western Cengage Learning.

References
Garrison, R., Noreen, E., & Brewer, P. (2014). Managerial Accounting (15th ed.). New York, USA: McGraw-Hill Higher Education.
Gitman, L. & Zutter, C. (2015). Principles of Managerial Finance (14th ed.). Upper Saddle River, New Jersey, USA: Pearson Prentice Hall.
Saunders, A. & Cornett, M. (2012). Financial Markets and Institutions (5th ed.). New York, USA: McGraw-Hill Higher Education.

B. Researches
Avanzi, B. (2009). Strategies for Dividend Distribution: A Review. North American Actuarial Journal, 13(2), 217-251.
Baker, H.K., Dutta, S., & Saadi, S. (2011). Management views on Real Options in Capital Budgeting. Journal of Applied Finance, 21(1), 18.
Belousova, A., Gurianov, P., Melnichuk, A., Vinichenko, M., & Duplij, E. Dividend Payments and Cross-country Differences in the Choice of Dividend. International
Journal of Economics and Financial Issues, 6(1S).
Cooper, W., Cornick, M., & Redmon, A. (1992). Capital Budgeting: A 1990 Study of Fortune 500 Practices. Journal of Applied Business Research, 8(3).
Grossman, R. (2010). Leverage, Liquidity and Solvency. RMG Financial Consulting.
Harford, J. & Uysal, V. (2014). Bond market access and investment. Journal of Financial Economics, 112(2), 147-163.
Lemmon, M.L. & Zender, J.F. (2010). Debt Capacity and Tests of Capital Structure Theories. Journal of Finance and Quantitative Analysis, 45(5), 1161-1187.
Mills, L. & Newberry, K. (2005). Firms’ Off-Balance Sheet and Hybrid Debt Financing: Evidence from their book-tax reporting differences. Journal of Accounting
Research, 43(2), 251-282.
Murray Z.F. & Vidhan K.G. (2009). Capital Structure Decisions: Which Factors Are Reliably Important? Financial Management Online Library, 38(1), 1-37
Travlos, N., Trigeorgis, L., & Vafeas, N. (2001). Shareholder Wealth Effects of Dividend Policy Changes in an Emerging Stock Market: The Case of Cyprus.
Multinational Finance Journal, 5(2), 87-112
Yao, D., Yang, H., & Wang, R. (2010). Optimal Financing and Dividend Strategies in a dual model with proportional costs. Journal of Industrial and Management
Optimization, 6(4), 761-777.

C. Websites
www.cengageasia.com
Textbook Website
www.mheducation.com
Textbook Website
http://www.fma.org/
Financial Management Association
www.investopedia.com
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Finance Terms
www.cfainstitute.org/
Chartered Financial Analyst Institute Website

Course Requirements
As a students in this course, you must comply with the following requirements:
1. Attendance and Class Participation
You are expected to attend all classes. Attendance in the lectures is very important because the lectures present new information and provide background for the assignments.
You are responsible for all of the material presented in lectures.
The USC Student Manual (2006 Edition) specifies that “a student who incurs absences of more than 20% of the prescribed number of class hours or laboratory periods
during the term should be given NC or 5.0.” A 3-unit course has 48 class hours. Students with three absences are required to get a readmission permit from the college dean.
Class participation is evidenced by individual or group outputs from in-class exercises. These outputs shall be collected at the end of a class meeting. In-class exercises
could include Short quizzes, seatworks, and group discussions.
2. Out-of-Class Learning Tasks and Assignments
To ensure learning engagement and constant timely practice, you are required to do out-of-class tasks in the form of small projects and recommended problems relevant to
a particular unit. To this end, you are required to have a notebook intended only for exercises. From time to time, your exercise notebooks will be checked in order to assess
the timeliness of your learning efforts.
3. Tests and Examinations
A minimum of four (4) exams are given during the semester and are scheduled following the schedules set by the university. The midterm exam and the final exam are
three-hour examinations and require students to present valid examination permits for participation in the examination.

Grading System
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This course will follow the standard grading system of the University as follows:
Assessment Tasks Weight (%) Assessment Reference
Midterm Grade
Class participation and attendance 25 Rubric No. 1
Pre-midterm summative exams and midterm exam 50 Multiple choice, open ended questions
Class activities (individual & group post-tests,
25 Rubric No. 2 Rubric No. 3, Rubric No. 4
assignments, and seatwork)
Total 100

Final Class Standing

Class participation and attendance 25 Rubric No. 1
Pre-final summative exams and final exam 50 Multiple choice, open ended questions
Class activities (individual & group post-tests,
25 Rubric No. 2 Rubric No. 3, Rubric No. 4
assignments, and seatwork)
Total 100

FINAL GRADE (1/3 Midterm Grade + 2/3 Final

100
Class Standing)

GPA Scoring
For purposes of transmutation, the standard equivalents will be used as follows:
Score Range 100-95 94-93 92-91 90-89 88-87 86-85 84-83 82-81 80-79 78-77 76-75
Grade Equivalent 1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 2.0

Score Range 74-73 72-71 70-69 68-67 66-65 64-62 61-59 58-56 55-53 52-50 49 below
Grade Equivalent 2.1 2.2 2.3 2.4 2.5 2.6 2.7 2.8 2.9 3.0 5.0

Note:
1. Students who obtain grades below 3.0 is equivalent to a failing grade of 5.0.
2. BSA students must maintain a 2.0 GPA in each core and professional course.
3. BSMA, BSAIS, and BSIA students must maintain a 2.5 GPA in each core and professional course.
4. Students who have not complied with their final requirements for the subject will be given an INC grade.
5. Students with an INC grade are given at most one year to comply with the necessary requirements to be given a final grade. Students whose grades are not changed
within one year will automatically receive a final grade of No Credit (NC).
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6. Students can only have a maximum of nine (9) units of INC grades at one time. Students who violate this rule will not be allowed to enroll in further subjects until
they comply with the requirements and have their INC grades changed.

Classroom Management
1. Attendance is a MUST. Students may incur only seven (7) absences at a maximum, otherwise, they will automatically be dropped from class and receive a grade of
either NC (No Credit) or a failing grade of 5.0, whichever is applicable.
2. Students who incur three (3) absences will be asked by the instructor to see the Department Chair to secure permission to be re-admitted to class. A re-admission slip
should be properly accomplished for this.
3. Tardiness is discouraged. It is a source of irritation and class disruption when students arrive late. Students who arrive 15 minutes after the start of class are considered
tardy. Please note that three (3) tardiness is equivalent to one (1) absence.
4. A permanent seat plan will be made at the start of the semester. Students are advised to keep to their assigned seating arrangement; otherwise, they will be marked
absent for that day.
5. Classes should always start and end with a short prayer. The instructor can opt to lead the prayer or assign students to do this alternately.
6. Students should assist in maintaining the orderliness and cleanliness of the classrooms. Graffiti writing is strictly prohibited. Any student found violating this rule will
be punished with the appropriate sanction. Before leaving the classroom, the instructor with the help of the students, should ensure that no litter/garbage is left behind
and that chairs are in their proper order. Should the class be the last schedule for the day, the instructor should arrange that the lights and air conditioning units are
switched off.
7. Going out of the classroom at any time is strictly discouraged. Students should make it a habit to go to the restroom during their vacant period or before the start of their
classes. If they must visit the restroom, permission should be sought from the instructor.
8. Use of mobile phones inside the classroom is strictly prohibited. They should be switched off or placed in silent mode before entering classes. The instructor has the
right to confiscate mobile phones that ring and/or are used during class hours. The confiscated unit can only be claimed from the Dean’s Office at the end of the semester.
9. The teacher reserves the right to ask the student to leave the room if his behavior is disruptive in class.
10. It is the responsibility of the students to properly schedule their classes so that meals and snacks will be taken at the proper time.
11. Students are encouraged to see the instructor during consultation hours for any concerns, questions and assistance with regards to the course.

Prepared by: Jovelyn Q. Yu, CPA, MBA, LRSM, FRSM Approved by:
Date: January 21, 2021 Date:
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Rubric No. 1: Assessing Student Participation

Level of Competence
Criteria Score
1 – Unacceptable 2 – Satisfactory 3 – Very Good 4 – Outstanding
Student does not initiate Students initiate contribution at Student initiates contribution Student initiates contributions
1. Frequency of
contribution and needs least in half of the recitations. once in each recitation. more than once in each 4
participation in class
instructor to solicit input recitation.

Comments are uninformative, Comments sometimes Comments mostly insightful Comments always insightful and
lacking in appropriate constructive, with occasional and constructive; mostly uses constructive; uses appropriate
terminology. Heavy reliance signs of insight. Student does appropriate terminology. terminology. Comments
2. Quality of
on opinion and personal taste. not use appropriate Occasionally comments are too balanced between general 2
comments
terminology; comments not general or not relevant to the impressions, opinions and
always relevant to the discussion. specific, thoughtful criticisms or
discussion. contributions.

Does not listen speak or does Student is often inattentive and Student is mostly attentive Student listens attentively when
not pay attention while other needs reminder of focus of when other present ideas, other present materials,
speak; detracts from class. Occasionally makes materials, as indicated by perspective, as indicated by
discussion; sleeps, etc. disruptive comments while comments that reflect and comments that build on others'
3. Listening skills others are speaking. build on others' remarks. remarks, i.e. student hears what 2
Occasionally needs say and contributes to the
encouragement or reminder dialogue.
from T.A. of focus of
comment.
(𝟒+𝟐+𝟐)
RUBRIC SCORE {[ ] + 𝟏} ∗ 𝟐𝟎 *3 refers to the # of criteria, 1 and 20 are constants 73.3333
𝟑

PERCENTAGE SCORE Computed as Rubric Score divided by 100 *100 is a constant 73.3333%
TRANSMUTATION EQUIVALENT Computed as Percentage Score multiplied by -4 plus 5 *-4 and 5 are constants 2.1
 19

Rubric No. 2: Teamwork Value Rubric

Level of Competence
Criteria Score
1 – Unacceptable 2 – Satisfactory 3 – Very Good 4 – Outstanding
1. Contributes Shares ideas but does not advance Offers new suggestions to advance Offers alternative solutions or courses Helps the team move forward by
to team the work of the group. the work of the group. of action that build on the idea of articulating the merits of alternative
others. ideas or proposals. 2
meetings

Completes all assigned tasks by Completes all assigned tasks by Completes all assigned tasks by Completes all assigned tasks by
2. Individual deadline. deadline; work accomplished deadline; work accomplished is deadline; work accomplished is
contributions advances the project. thorough, comprehensive, and thorough, comprehensive, and
outside of advances the project. advances the project. Proactively 4
helps other team members complete
team meetings their assigned tasks to a similar level
of excellence.
Supports a constructive team climate Supports a constructive team climate Supports a constructive team climate Supports a constructive team climate
by doing any one of the following: by doing any two of the following: by doing any three of the following: by doing all of the following:
Treats team members respectfully Treats team members respectfully Treats team members respectfully Treats team members respectfully
by being polite and constructive by being polite and constructive by being polite and constructive in by being polite and constructive
in communication. in communication. communication. in communication.
Uses positive vocal or written Uses positive vocal or written Uses positive vocal or written Uses positive vocal or written
3. Fosters tone, facial expressions, and/or tone, facial expressions, and/or tone, facial expressions, and/or tone, facial expressions, and/or
constructive body language to convey a body language to convey a body language to convey a body language to convey a
positive attitude about the team positive attitude about the team positive attitude about the team positive attitude about the team 1
team climate
and its work. and its work. and its work. and its work.
Motivates teammates by Motivates teammates by Motivates teammates by Motivates teammates by
expressing confidence about the expressing confidence about the expressing confidence about the expressing confidence about the
importance of the task and the importance of the task and the importance of the task and the importance of the task and the
team’s ability to accomplish it. team’s ability to accomplish it. team’s ability to accomplish it. team’s ability to accomplish it.
Provides assistance and/or Provides assistance and/or Provides assistance and/or Provides assistance and/or
encouragement to team members. encouragement to team members. encouragement to team members. encouragement to team members.
(𝟐+𝟒+𝟏)
RUBRIC SCORE {[ ] + 𝟏} ∗ 𝟐𝟎 *3 refers to the # of criteria, 1 and 20 are constants 66.6667
𝟑

PERCENTAGE SCORE Computed as Rubric Score divided by 100 *100 is a constant 66.6667%
TRANSMUTATION EQUIVALENT Computed as Percentage Score multiplied by -4 plus 5 *-4 and 5 are constants 2.3
 20

Rubric No. 3: Problem Solving Value Rubric

Level of Competence
Criteria Score
1 – Unacceptable 2 – Satisfactory 3 – Very Good 4 – Outstanding
1. Defining the Student does not identify the Student fails to define the Student adequately defines Student states the problem and
Problem/identification problem and/or operational problem and/or operational the problem and/or clearly and identifies underlying 3
of operational issues. issues. issues adequately. operational issues issues.

2. Developing a Plan to Student does not develop a Student develops a marginal Student develops an adequate Student develops a clear and
Solve the Problem coherent plan to solve the plan, and does not follow it to plan and follows it to concise plan to solve the
problem. conclusion. conclusion. problem, with alternative 3
strategies, and follows the plan to
conclusion.

3. Collecting and Student collects no viable Student collects inadequate Student collects adequate Student collects information from
Analyzing information. Incorrect information to perform information and performs multiple sources and analyzes the
Information/application analysis based on partial meaningful analyses. basic analyses. information in-depth. Excellent 3
of analytical techniques understanding of the application of the appropriate
problem. techniques

4. Interpreting Findings Student does not interpret the Student provides an Student provides an adequate Student provides a logical
and Solving the findings/reach a conclusion. inadequate interpretation of interpretation of the findings interpretation of the findings and
Problem, Incorrect recommendation. the findings and does not and solves the problem, but clearly solves the problem,
Recommendations No managerial insights. derive a logical solution to the fails to provide alternatives. offering alternative solutions. 2
&Managerial insights problem. Reasonable Reasonable recommendation, With solid recommendation and
recommendation, but does not but weak managerial insights. managerial insights.
offer a managerial insights.
(𝟑+𝟑+𝟑+𝟐)
RUBRIC SCORE {[ ] + 𝟏} ∗ 𝟐𝟎 *4 refers to the # of criteria, 1 and 20 are constants 75
𝟒

PERCENTAGE SCORE Computed as Rubric Score divided by 100 *100 is a constant 75%
TRANSMUTATION EQUIVALENT Computed as Percentage Score multiplied by -4 plus 5 *-4 and 5 are constants 2.0
 21

Rubric No. 4: Topic Presentation Rubric

Level of Competence
Criteria Score
1 – Unacceptable 2 – Satisfactory 3 – Very Good 4 – Outstanding
1. Introduction/ The introduction does not The introduction shows some The introduction is clear and The introduction presents the overall
Organization orient the audience to what will structure but does not create a coherent and relates to the topic. topic and draws the audience into the
follow. The sequencing is strong sense of what is to follow. presentation with compelling questions or
unclear and does not appear May be overly detailed or by relating to the audience's interests or 3
interesting or relevant to the incomplete and is somewhat goals.
audience. appealing to the audience.
2. Content The content lacks a clear point The content is vague in conveying a The content is written with a The content is written clearly and
of view and logical sequence of point of view and does not create a logical progression of ideas and concisely with a logical progression of
information. Includes little strong sense of purpose. Includes supporting information. Includes ideas and supporting information. The
persuasive information and some persuasive information with persuasive information from project includes motivating questions and
only one or two facts about the few facts. Some of the information reliable sources. advanced organizers. The project gives 3
topic. Information is may not seem to fit. Sources used the audience a clear sense of the main
incomplete, out of date and/or appear unreliable. idea. Information is accurate, current and
incorrect. Sequencing of ideas comes mainly from primary sources.
is unclear.
3. Presentation Presentation was not clearly Presentation was audible, but needs Presentation was audible. Good Presentation was presented in a
audible and hard to hear. Visual improvement on tone of voice tone of voice when speaking. professional way. Audio and visual
presentation was very when speaking. Visual aspects of Visual aspects of project was aspects were perfect. Group members
disorganized and hard to read. project could be better organized organized and easy to read. were able to answer all questions posed
Group members did not ask for and easier to read. Group members Group members were able to by the other students as well as the 3
questions and were unable to were not able to answer some answer most questions posed by instructor.
answer questions asked by questions when asked by instructor instructor and other students.
other students or the instructor. or other students.
4. Group Some team members have no Some group members participate. Most group members participate All group members participate and
Presentation role in presentation. equally, not all demonstrate knowledgeable of material. 3
knowledge of material.
(𝟑+𝟑+𝟑+𝟑)
RUBRIC SCORE {[ ] + 𝟏} ∗ 𝟐𝟎 *4 refers to the # of criteria, 1 and 20 are constants 80
𝟒

PERCENTAGE SCORE Computed as Rubric Score divided by 100 *100 is a constant 80%
TRANSMUTATION EQUIVALENT Computed as Percentage Score multiplied by -4 plus 5 *-4 and 5 are constants 1.8