Student guide Faculty of Economics A.Y. 2007/08

Business Finance
Aim of the course
Part one: business finance
1.   To provide a general overview of the finance function and its links with other functions of the firm, identifying the factors which determine the financial dynamic of the firm.
2.   To analyse the interrelations between the economic and financial aspects of a business firm, with particular regard to investment and financing policies.
3.   To identify the decisional criteria for optimising the financial structure of the firm.
4.   To impart the knowledge necessary for the valuation of firms and the principal procedures for their transfer.
Second part: financial markets
1.   To study in-depth the different methods for meeting the financial needs of firms, and the various instruments which can be used to this end.
2.   To identify the principal channels of financing open to firms, particularly with regard to the credit, securities exchange and private equity markets.
3.   To gain an understanding of the most significant actors on the financial markets.
Part one: business finance
1.     Business financial analysis.
1.1   Introduction to finance: role, functions and objectives.
1.2   Financial planning.
1.3   Financial dynamics of the firm and management of circulating capital.
1.4  Financial flows, statement of sources and uses, the financial statement, the cash budget.
2.    Investment decisions.
2.1   Present value and time value of money.
2.2   Economic-financial valuation of investments.
2.3   Analysis under uncertainty.
3.    Enterprise risk and the financial structure.
3.1   The risk/yield ratio.
3.2   Financial structure of the firm and cost of capital.
3.3   Financial leverage.
4.     Financial aspects of growth and extraordinary transactions.
4.1   External growth and extraordinary transactions.
4.2   General principles of valuation and business appraisal methods.
Part two: financial markets
1.     Financial choices of the firm and reference markets.
1.1  Principal means of procuring financial resources.
1.2   The principal financial instruments
2.     Use of debt capital: instruments for the short and medium/long term.
2.1   Banking activities.
2.2   Issues.
2.3   Structured and project finance.
3.     Use of risk capital.
3.1  Mezzanine finance.
3.2   Use of private equity.
3.3   Listing on a regulated market.
Distance students will be assessed by a final oral examination. Students who attend class will have the opportunity to sit an intermediate written test at the end of the first part of the course, and an oral covering the second part at the end of the course.
Reading list
Gervasoni A. (editor), La gestione finanziaria dell’impresa, Guerini e Associati, Milano, 2003.
Gervasoni A. (editor), Sviluppo d'impresa e mercato finanziario, Guerini e Associati, Milano, 2002.
Students who attend class will have an abridged reading list to prepare for the exam.