URL study guide

https://studiegids.vu.nl/en/courses/2024-2025/E_FIN_ACF

Course Objective

This course is an advanced course in Corporate Finance. This course has three main learning objectives. 1. Extending academic/ professional knowledge in Corporate Finance: learning about academic concepts in Corporate Finance (Bridging Theory and Practice
- Knowledge). 2. Understanding the origin and empirical strength of academic concepts in Corporate Finance: (Bridging Theory and Practice
- Knowledge). 3. Applying academic concepts in Corporate Finance in real life cases: confrontation of academic concepts in Corporate Finance with real life situations (Bridging Theory and Practice
- Application). Additional learning objectives for the assignments and case solving are:
- Ability to report in a briefly and concise way (Professional / Social Skills)
- Awareness of your skills in bridging theory and practice and case solving skills (Self-awareness Skills) After following this course, you:
- Understand Corporate Finance academic concepts, including their strengths and limitations in application in Corporate Finance practice.
- Are able to apply these basic concepts in real life cases (professional practice), i.e. being able to choose between various concepts. More specific learning objectives for the assignments and case solving are:
- Ability to analyse and solve real life cases in Corporate Finance;
- Being able to report on a case in Corporate Finance.

Course Content

This course is an advanced course in Corporate Finance. Corporate Finance discipline is about matching companies’ assets with investor’s preferences. It has both a micro perspective on CFO decision making and a macro perspective on the functioning of Corporate Financial Markets. This course gives an overview of academic knowledge in corporate finance relevant for corporate finance professionals. Specific attention is given to the application of corporate finance theories in practice: do assumptions hold? Which theory fits best in which specific circumstances? This course requires basic knowledge from standard textbooks on Corporate Finance, like the book written by Brealey, Myers and Allen or the book authored by Berk and DeMarzo. Main topics in this course are:
- leverage decision;
- dividend decision;
- relevance of risk management in corporate finance;
- corporate debt market;
- structured corporate finance (project finance, asset securitization, LBO);
- credit risk measurement (including rating agencies) and credit risk pricing;
- equity risk measurement and pricing

Teaching Methods

Lectures and working classes

Method of Assessment

Both a final written exam (minimum grade >= 5.5) and case assignments. Details will be provided in the course outline.

Literature

TBA in the course outline

Target Audience

This course is designed for students in the VU Master of Finance.

Entry Requirements

This advanced course is elaborating on classical text books like Corporate Finance (Berk and DeMarzo) and Principles of Corporate Finance (Brealey, Myers and Allen). Students are expected to be familiar with chapters in these books on time value of money, basic valuation formulas for bonds and stocks, Markowitz, CAPM, cost of capital, capital structure, payout policy, option valuation and working capital management. These chapters mark the entry knowledge level of this course which is also required knowledge at the exam. For example, chapters 4, 6, 9, 11, 12, 14 – 18, 20, 21, 26 and 27 (Berk and DeMarzo, Corporate Finance, 5th global edition) contain required knowledge at the exam. Students not very familiar with these standards books in Corporate Finance are advised to have a look at these books or even buy it for (required) background knowledge needed in this course.
Academic year1/09/2431/08/25
Course level6.00 EC

Language of Tuition

  • English

Study type

  • Master