Professor Jonathan A. Scott
Finance W350
Seminar in Financial Management
Fall 2005
Tuesday: 2:40 - 5:10 p.m.
Course Description: This course integrates the key concepts of finance around the theme of valuation. The course enables students to: prepare a complete financial analysis focusing on the firm's sources of value and economic profit; compute a firm's cost of capital using publicly available data; value a firm using comparables and free cash flow methods; have a basic understanding of how the presence of real options affects standard methods of valuation; and use the valuation model to assess takeover alternatives and potential capital structure changes
Prerequisities: Finance 0101 and 0103 (or 0191 and 0193), Finance 0211 or 0223, and Accounting 0011
Course Learning Objectives:
Finance W350 is the capstone course for the finance major. The goal of the course is to integrate key concepts you should have learned as a finance major around the theme of valuation. Upon completion of the course, you should have a firm grasp of the fundamentals of valuation and should be able to communicate these fundamentals in a clear, non-jargon laden way to business professionals. By the end of the semester, you should be able to:
Required Texts: Seminar in Corporate Finance (readings book from Southwestern Inc.; ISBN 032453437X); Instructor teaching notes
Office Hours:
Leave a voice (215.204.7605) or email [jonathan.scott@temple.edu] at any time. I usually respond to e-mail very early in the morning. If you send me a question after 9:00 p.m. you will usually have a response by 9:00 am the next day. All student e-mails will be answered within 24 hours during the regular semester (first day of class through the last day of final exams).
Individual appointments can be made for on-campus times via phone [voice mail messaging] or e-mail. My office hours are from 11:30 - 1:00 on TTH and Friday afternoons by appointment. I will not be available on the following Fridays: September 9 and 23, October 14 and 21, November 18, and December 2. My office number is 368 Speakman Hall, on the third floor in the southwest corner.
Pedagogy:
This course meets both the writing and technology requirements for the Fox School of Business and Management. All of the writing assignments will be in a business memo format that requires a recommended course of action.
The technology component of the course is met with computer usage for the writing assignments. Many of these assignments will require you to access financial data from third party sources of data (www.investor.reuters.com and finance.yahoo.com) and construct spreadsheets, or use templates that I provide. Use of the Internet is mandatory to complete the requirements for the writing assignments. The Reuter's site requires you to register (for free).
Delivery of the course involves a combination of lecture, inquiry, and in-class group activities. You are responsible for reading and comprehending non-technical, institutional material; class time will be reserved for applications. I will try to reserve about 15-20 minutes at the end of some classes for a group activity that requires you to use financial information to make a recommendation about a company. Other classes will require you to review a key concept at the beginning of class.
The course only meets once per week and you need to adjust your preparation time accordingly. You should be spending at least 6 hours a week for each class if you want to master this material. If you begin the reading the night before or morning of the class, you will fall behind in the course and feel that I am covering the material too fast in class. Emphasis is given to applying the concept of real-world financial decision making. You will find this course more unstructured than your other courses and the burden of learning the material, like the real world, rests with you, not me (see statement on Personal Responsibility).
All course resources will be provided through Blackboard. I will make use of Blackboard's Discussion Board to provide an opportunity to ask questions about all assignments, class topics, and current events pertinent to this course. If you ask me questions about material posted to Blackboard, I will refer you to Blackboard instead of directly answering your question. You MUST consult Blackboard periodically each week. Items that will be posted to Blackboard include:
Reinforcement of key quantitative concepts in the course will be accomplished through questions I ask in class and periodic quizzes throughout the semester.
Course Grade
The final grade is weighted as follows:
Writing assignments (66% or 400 points): There are four (4) mini-case assignments, each worth 100 points. Letter grades are assigned with a mapping to a point total (e.g., A=95, A-/B+ = 90). All assignments may be completed by groups, but you may work individually. Groups will not exceed 3 persons. The assignment due dates will be posted to Blackboard. NO LATE ASSIGNMENTS ARE ACCEPTED - if you submit the assignment late your grade is 0.
These are short memos (1000 word maximum excluding exhibits) where you are responding to a question in the role of consultant to or subordinate of a senior financial manager. If you submit the assignment to me 36 hours before the due date, I will provide you with comments that should help you improve your grade.
You will receive two grades on the assignment: the first is for content and the second is for writing style. The total grade is the sum of the two grades. I expect that many of you will have higher grades for content than writing style. Your writing style grade will be a function of clarity, organization, grammar, completeness of exhibits, etc. You should not be surprised to receive writing grades below a C- on your first assignment.
If you want to improve your grade on the first three mini-cases, the assignment can be resubmitted. The last mini-case cannot be resubmitted as a re-write. In addition, I will not comment on the re-writes. The grade on the re-write will be based on how well you addressed my comments as well as the content of the class discussion and improvements in the style. I reserve the right to raise other issues not previously noted in the original draft that should have been addressed in the rewrite. The easiest way to improve the style component of the grade is to take your draft to the University Writing Center and have them help you revise the paper. Re-writes are due two weeks after they are returned to you.
Your final grade on the assignment will be a weighted average of grades on the submitted assignment, with a 25% weight assigned to the initial submission and 75% to the final submission. For example, suppose you choose to hand in an incomplete or poorly written assignment and you are given a 50 (F). If the next assignment is receives a weighted grade of A-/B+ (90), the your final grade for the assignment will be a 82 (= .25 x 50 + .75 x 90). If you meet all the stated requirements of the assignment you will earn an A, which is a 95/100. If you 'wow' me with your analysis, you will earn an A+ (98-100).
Here is a guideline of some of the grade deductions that I will apply. Please note that this list is not inclusive.
Each mini-case will be discussed in class on the date it is due (which is why no late assignments will be accepted). The format will vary. We may have panel discussions where you will be given a chance to prepare at the beginning of class. Or, I may ask you questions directly. Your participation in these discussions is an important part of your class participation grade.
Quizzes (25% or 150 points): There will be 6 quizzes given at the beginning of class that are worth 25 points each. These quizzes may ask be objective (multiple choice), short answer, problems or a mixture. They are based on assigned material for that class as well as material covered from the previous class. You will be given 20 minutes to complete the quiz at which time my teaching assistant will pick them up for grading. I will drop the lowest quiz grade. There are no make-ups. If you are late for class you will not be given extra time for the quiz; if you miss class, this will be the quiz grade that is dropped.
Class participation (8.3% or 50 points): Class participation is an essential part of learning in this class. To participate in class you must be prepared for class; if you are not prepared, then this part of the grade will suffer. Your class participation grade will mostly be based on your mini-case presentations, contributions during the in-class mini-case review, and contributions to the in-class group activities. Everyone starts with 0 points. If you choose not to volunteer to participate throughout the semester, then the highest grade you can earn is 550/600 points, or 92% (A-).
Incompletes: I only give an "I" if you meet the requirements for this grade, i.e., you have completed substantially all of the work in the course, but for some unforeseen reason you cannot finish the course.
The departmental grading policy is that the average grade for this course should be a 2.90 (A=4.00) +/- .20. Grades will be adjusted by the end of the semester for achieve this target. Any questions about this policy should be directed to the department chair, Dr. Kopecky. My class average has generally been around this target using the following percentage grade cutoffs: A (93% and higher), A- (90-92%), B+ (87-89%), B (83-86%), B- (80-82%), C+ (77-79%), C (73-76%), C- (70-72%), D (below 70%). The total number of points is 600.
Attendance:
I take attendance for this class because it only meets once per week. Each absence is equivalent to missing 3 classes that meet MWF or 2 classes that meet TR. For each absence beyond 3, you final grade will be reduced by 1/2 a letter grade. There are no 'excused' absences. I will come to class prepared and expect no less from you; thus I expect you to have read the assigned material. If you cannot make class, please notify me by telephone or e-mail.
Disability Disclosure:
Any student who has a need for accommodation based on the impact of a disability should contact me privately to discuss the specific situation as soon as possible.
Academic Integrity: If I find that you have submitted any writing assignment that is identical (or close to identical) of another group or if I suspect cheating on any of the quizzes, the following procedure will take place. First, I will contact you personally (via email) to discuss the issue in my office. Based on the outcome of that meeting, the incident will either be dropped or forwarded to the Dean's Office of the Fox School of Business. If the incident is forwarded to the Dean's Office (and possibly the University Disciplinary Committee), then you will receive an F for the course pending their decision.
Personal Responsibility (read carefully!)
All of the requirements for this course are clearly stated in this document, as well as other places within Blackboard. I will try to remind you of due dates, but ultimately this is your responsibility. If you do not turn assignments in, then I will assume that you understand the consequences of your actions. If there are any changes, I will post them to the Announcements section within Blackboard. Part of doing well in this course is begin well organized and to turn in your assignments on time.
Finally, this course is somewhat unstructured compared to a typical undergraduate course. The burden of learning falls on you. This means you need to read the material assigned and review the lab assignment sheets after class. My role in class is to guide you to the resources necessary to get the job done and to demonstrate relevant analytical techniques, not 'spoon feed' you basic finance that you should already know. If you cannot organize your time effectively (e.g., work, student organizations, other course requirements have a higher priority), then your grade will suffer.
You will be notified of the last day to drop the course later in the semester. Please be advised that I have no minimum grade for this course. If you do not perform at a C- level then you will have to repeat this course in order to graduate. If you cannot keep up with the material you should withdraw from the course before the deadline. If you don't, please remember that I have no obligation to pass you in this course.
Miscellaneous:
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Last update: 19 August 2005 08:53