LV EN RU DE FR

Finance and Investment Management

Course developers

Replaced course

VadZ6009 [GVAD6010] Finance and Investment Management

Course abstract

The study course deepens knowledge and broadens understanding of
effective financial management as a tool for planning company developments and for investments - a choice between risk and expected profit. As part of the study course, students will gain an understanding of the management of financial resources in various segments of the company with the aim of using them as efficiently as possible and at the right moment to see that additional financing is needed. As part of the study course, students will gain an understanding that there is no one-size-fits-all investment solution, so the risk acceptable to the investor and possible investment alternatives must be assessed.

Learning outcomes and their assessment

Knowledge
1. In-depth knowledge and understanding of the tasks of effective financial management, planning expenses, analyzing financial indicators, taking into account possible financial crises and other macroeconomic and geopolitical factors - practical work in a group, discussion.
2. Knowledge of the application of the most important asset management methods, the economic evaluation of real investment projects and the ranking of the results of project evaluation methods - practical work in a group, 1st test with calculations.
3. Structured knowledge and understanding of financial management processes in order to timely monitor company risks - discussion, exam.
Skills
4. Able to apply acquired knowledge and practical skills to independently formulate and critically analyze aspects and problems of financial and investment management in the economic and financial context - practical work in a group, discussion.
5. Able to perform calculations, analyze the obtained results, understand the causes and develop proposals for preventing problems or improving the situation - practical work in a group
6. Able to constantly evaluate the performance of another person and prepare a written conclusion about it (the cash flow of the developed project, the proposed practical solution, as well as the compliance of the expressed proposals with the achievable result) - practical work in a group, discussion.
7. Able to evaluate financial investment policy, apply various methods of asset evaluation and perform calculations of the profitability and investment efficiency of shares and bonds - practical work in a group, 2nd test.
Competences
8. Can critically evaluate and independently choose financial management digitization processes and prepare for making strategic and profitable decisions - practical work in a group, discussion.
9. Based on acquired knowledge and practical skills, able to formulate, describe and analyze financial management issues, able to independently judge and evaluate financial management processes - practical work in a group, discussion.
10. Can choose the most appropriate type of financing for the project and evaluate the effectiveness of the financial investments made compared to other projects or investments, analyze and evaluate the financial and economic indicators of the project, as well as plan and evaluate the impact of the project's cash flow, inflation and financial risks, develop the project budget - 3 .test with calculations.
11. Can apply acquired knowledge, work successfully in project development, apply modern financial management methods and plan and manage finances as efficiently as possible. Able to make proposals for decision-making according to the economic situation (inflation changes, financial risk in crisis conditions) – exam, independent work with calculations, presentation of individual work.

Course Content(Calendar)

1. Financial management methods and processes. (lectures 2 h, practical work 2 h).
2. Increasing the value of the company. (lectures, 2 h practical work 2 h).
3. Effective use of company resources. (lectures, 2 h practical work 2 h).
4. Creating an optimal capital structure. (lectures, 2 h practical work 2 h).
5. Investment process, criteria for making decisions on investment projects. Financial calculations and forecasted cash flow analysis of investment projects. (lectures 4 h, practical works 4 h).
6. The system of investment project evaluation indicators and their calculation methods. Sensitivity analysis of investment projects. (lectures 2 h, practical works 2 h).
7. Stages of financial investment management. (lectures 1 h, practical works 1 h) .
8. Asset valuation methods. CAPM model. Risk and return. (lectures 1 h, practical work 1 h).

Requirements for awarding credit points

Successfully passed 3 tests:
1) Theoretical issues of project financing and evaluation. Cash flow discounting. Evaluation of projects according to NPV, DPP, IRR, ARR. Arranging the results of project evaluation methods (20%).
2) Financial investment policy, asset valuation model CAPM, stock and bond calculations 20%).
3) Management of working capital. Capital structure management. Management of business financing sources. (20%).
Independent work - individually conducted research presentation of a written exam in accordance with the tasks and design rules set in advance of the exam work. Successfully passed the written exam (40%).

Description of the organization and tasks of students’ independent work

Learn and consolidate theory material by solving tasks and tests. Preparation for tests and the exam. Individual research - Analysis and presentation of industry or company financing models and performance results.

Criteria for Evaluating Learning Outcomes

The grade of the study course exam is determined by the cumulative assessment - 100%, where 10% corresponds to one point on the 10-point study results evaluation scale.
The evaluation of the study course consists of:
1st test – 20%
2nd test – 20%
3 test – 20%
Exam - final permanent work 40%.

Compulsory reading

1. Altman E., Hotchkiss E., Wang W. Corporate Financial Distress, Restructuring, and Bankruptcy. Analyze Leveraged Finance, Distreesed Debt, and Bankrupcy. Fourth Edition. Hoboken, New Jersey: John Wiley & Sons, 2019, p.349.
2. Eun Cheol S. International Financial Management ISE 10th edition. McGraw-Hill Education,2023,p.624.
3. Hillier D., et al. Corporate Finance. Fourth European Edition. London: McGraw-Hill Education, 2021, p.864
4. Rodriguez E. Risk Analytics: Data-Driven Decisions under Uncertainty, The University of Ottawa, Ontario, Canada, 2023, p. 469.
5. Pasquale De Luca. Corporate Finance: Fundamentals of Value and Price 1st ed. Springer Nature Switzerland AG, 2023, p.638.
6. Welc J. Evaluating Corporate Financial Performance: Tools and Applications. Switzerland AG: Springer Nature, 2022, p. 324 .
7. Mucenieks K. Veiksmīga uzņēmumu apvienošana un iegādes integrācijas noslēpums. Monogrāfija. Rīga: Turība, 2022, 207 lpp.

Further reading

1. Alexander D., Jorissen A., et al. International Financial Reporting & Analysis. Hampshire; UK: Cengage Learning EMEA, 2020,p. 908.
2. Amir E., Ghitti M. Financial Analysis of Mergers and Acquisitions: Understanding Financial Statements and Accounting Rules with Case Studies. Switzeland AG: Springer Nature, 2020, p. 298.
3. Bragg S. The Interpretation of Financial Statements. Third Edition. Centennial, Colorado: Accounting Tools, 2021, p. 204.
4. Elliott J., Elliott B. Financial Accounting and Reporting. Twentieth Edition. Harlow; UK: Pearson Education Limited, 2022,p. 801.
5. Fridson M., Alvarez F. Financial Statement Analysis: A Practitionerʻs Guide. Fifth Edition. Hoboken, New Jersey: John Wiley & Sons Inc., 2022, p. 428.
6. McLaney E, Atrill P. Accounting and Finance an Introduction. Tenth Edition. Harlow; UK: Pearson Education Limited, 2020, p.857 .
7. Robinson T., et al International Financial Statement Analysis ( CFA Institute Investment Series), 4 th Edition. Hoboken, New Jersey: John Wiley & Sons Inc., 2020, p. 978.

Periodicals and other sources

1. Dienas Bizness / nedēļas laikraksts. Rīga. [tiešsaiste], Pieejams: https://www.dienasbizness.lv/
2. European Business / žurnāls. European Business Journal [tiešsaiste]. International Business Verlag GmbH. ISSN 0955-808X. Pieejams: http://www.european-business-journal.com.
3. "iFinanses" – aktuāli un noderīgi par grāmatvedību, nodokļiem
un finanšu vadību. Pieejams:https://ifinanses.lv/zurnals-ifit.
4. The Economist / nedēļas laikraksts. The Economist. London: Economist Newspaper Ltd. [tiešsaiste]. ISSN 0013-0613. Pieejams: http://www.economist.com.

Notes

Restricteded elective study course for ESAF academic master's study program “Economics” for specialization direction “Financial Management and Accounting” for full-time students.