Financial Management of the Corporate
FP-fmKAcad. year: 2018/2019
The course focuses on three topics:
• deciding on the allocation of financial resources on the basis of economic criteria
• deciding on gaining sources of financing (theoretical approaches, practical solutions)
• managing the enterprise’s solvency.
Learning outcomes of the course unit
Knowledge: Students know what tasks are secured by the financial/economic unit, as well as the objectives which the enterprise follows in individual stages of its development, and the specifics of financial management in individual stages. They know how to describe the basic decision-making tasks, and develop appropriate methods for assessing alternative solutions. They know theoretical approaches to the optimisation of the capital structures of enterprises, models for determining the cost of capital, criteria for deciding on profit distribution and criteria for investment decision-making. Students know the theoretical basics of cash management as well as practical approaches.
Skills: Students are able to judge the suitability of sources of finance for enterprises according to various criteria and the conditions for provision, establish criteria for assessing investment projects by type of project and the objectives of the enterprise. They are able to choose the appropriate approach to measuring and considering risk in investment decision-making. They can also choose the appropriate arguments for communication with investors and creditors in gaining sources of finance, and when deciding on profit distribution. They are able to set the price, establish the price of funding sources and use these categories in financial decision-making. They know how to hedge foreign exchange risk, and can calculate the hedging cost.
Abilities: Students are able to propose an appropriate means of financing an enterprise according to the area of business and financing the risks of an enterprise when using the criteria of capital costs. They are able to comprehensively judge the economic efficiency of an investment project, including analysis of project risks. They know the limitations of the individual methods of evaluating the effectiveness of projects and are able to consider non-financial factors in the sustainability of a project. They are able to competently develop a financial project, including the schedule of net working capital, as well as short-term projected cash flows. They are able to implement measures to channel the cash flow of the enterprise.
For study of the course, you must have a knowledge of accounting, be able to perform financial analysis and interpret the results of the financial analysis, understand the importance of a functioning financial market, and have a knowledge of the field of banking, financial mathematics and corporate economics.
Recommended optional programme components
Recommended or required reading
BRIGHAM, E. F. & EHRHARDT, M. C. Financial Management: Theory and Practice, 2011, 1152 s. ISBN 978-1-4390-7809-9
REŽŇÁKOVÁ, M. Efektivní financování rozvoje podnikání. Praha: Grada, 2012. ISBN 978-80-247-1835-9
REŽŇÁKOVÁ, M. a kol. Řízení platební schopnosti podniku. Praha: Grada, 2010. 200 s. ISBN ISBN 978-80-247-3441-5
KISLINGEROVÁ, E. a kol. Manažerské finance. 2. přeprac. a rozš. vyd. Praha: C. H. Beck, 2010.
NÝVLTOVÁ, R. REŽŇÁKOVÁ, M. Mezinárodní kapitálové trhy: zdroj financování. Praha: Grada, 2007. 222 s. ISBN 978-80-247-1922-1.
MAŘÍK, M. MAŘÍKOVÁ, P. Moderní metody hodnocení výkonnosti a oceňování podniku: ekonomická přidaná hodnota, tržní přidaná hodnota, CF ROI. Přeprac. a rozš. vyd. Praha: Ekopress, 2005. 164 s. ISBN 80-86119-61-0.
VALACH, J. Investiční rozhodování a dlouhodobé financování. 2. přeprac. vyd. Praha: Ekopress, 2005. 465 s. ISBN 80-86929-01-9.
BREALEY, R.A. a MYERS, C.S. Teorie a praxe firemních financí. Praha: Computer Press, 2000. 1064 s. ISBN 80-7226-189-4.
FOTR, J. Strategické finanční plánování. Praha: Grada Publishing, 1999. 149 s. ISBN 80-7169-694-3.
Planned learning activities and teaching methods
The course is focused on the explanation of the main principles and presentation of the decision problems as well solution of model situation.
Assesment methods and criteria linked to learning outcomes
The exam is written and focuses on the verification of theoretical knowledge and practical applicability. The amount of theoretical knowledge are at the level by recommended literature, the questions are open and closed. Practical knowledge is verified by solving skills standardized examples, exercises in the consultation. The test is required 50% success rate. The exam lasts 150 min.
Classification tests are defined by Rules for Studies and Examinations of BUT.
Language of instruction
• Financial objectives (enterprise value, EVA) and their breakdown, the position of financial manager.
• Content and typical decision-making tasks in the financial management of an enterprise by the phases in the life cycle of the enterprise.
• Content and methods of financial planning.
• Strategic financial decisions – sources of financing and their cost, deciding on capital structure (theoretical approaches and practical solutions) and policy, choice of arguments for creditors and investors.
• Strategic investment decisions – assessing the effectiveness of investment projects, choosing the appropriate methods and their limits, considering risk in investment decisions, the investment portfolio. Investment planning. Sustainability of projects.
• Managing the solvency of the enterprise – working capital, credit management, risks in foreign trade and minimising them, cash management, managing foreign exchange risk, calculating hedging costs.
The objective of the course is to acquaint students with current problems and trends in the area of the financial management of an enterprise, based on a knowledge of financial systems, as well as business processes, and to teach students to appropriately apply methods of financial decision-making.
Specification of controlled education, way of implementation and compensation for absences
Attendance at lectures is not compulsory, but is recommended.
Monitoring of results of independent work on assigned tasks.
Type of course unit
Guided consultation in combined form of studies
20 hours, optionally
Teacher / Lecturer