TWINTECH COLLEGE
SARAWAK BRANCH
--------------------------------------------------------------------------------------------------------------------------------------------------------------------
Nama Program Pengajian
:
Universiti Rakan Kerjasama
:
Diploma (Pengurusan Teknologi /
Perakaunan)
Universiti Teknologi Malaysia
NAMA MATA PELAJARAN
INTRODUCTION TO FINANCE
KOD MATA PELAJARAN
DDW 2253
TARAF MATA PELAJARAN
Major
JAM KREDIT
3
JAM KONTAK
3 hours lecture and 1 hour tutorial
PERINGKAT
Diploma
SEMESTER & TAHUN
DIAJAR
Semester 1 & Year 3 / Semester 1 & Year 2
PRASYARAT (SEKIRANYA
ADA)
DDG 1113
KAEDAH PENYAMPAIAN /
PENGENDALIAN
-
SISTEM PENILAIAN DAN
PECAHAN MARKAH
Test 1
Test 2
Assignment
Quiz
Final exam
15%
15%
5 %
5 %
60%
An 80% of attendance is required for the course registered. If you failed to meet
the requirement, you are not allowed to sit for the final exam.
GURU YANG MENGAJAR
OBJEKTIF MATA
PELAJARAN
1.
2.
3.
To introduce students to the world of finance
To introduce students to the basic financial concepts such as the time value of
money, asset valuation and risk and return
To provide the students with the tools in making financial decisions
SINOPSIS MATA
PELAJARAN
DDW2253 is an introductory finance course that provides the general principles and
an overview of the entire field of finance. The course is designed for the general
business students, not just the finance major. It starts with a general overview of
finance and then go into more details on several concepts, financial instruments and
techniques used in financial decision making.
LEARNING OUTCOME
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
Define the term finance and explain why finance is relevant to students
Identify the components of the financial environment
Explain how investors monitor managers to ensure that managerial decisions
are in the best interest of the owners
Describe how the financial environment has become internationalised
Explain how financial institutions serve as intermediaries between investors
and firms
Provide an overview of financial markets
Explain how firms and investors trade money market and capital market
securities in order to satisfy their needs
Describe the major securities exchanges
Discuss the general features, ratings, popular types, and international issues of
corporate bonds
Differentiate between debt and equity capital
Discuss the rights and features of common and preferred stock
Understand the role of the investment banker
Discuss the components that comprise the interest rate at a given point in time
Explain the relationship between risk and the nominal interest rate on a debt
security
Explain why the returns required on risky assets change over time
16. Discuss the role of time value in finance and the use of the computational aids
17. Calculate present and future value for a single amount, ordinary annuity,
annuity due and a mixed stream of cash flows. Calculation of a perpetuity
18. Understand the effect that compounding more frequently than annually has on
future value and the effective annual rate of interest
19. Understand the meaning and fundamentals of return, risk and risk aversion
20. Discuss risk measurement for a single asset using the standard deviation and
coefficient of variation
21. Understand the return and risk characteristics of a portfolio in terms of
correlation and diversification
22. Review the two types of risk and the derivation and role of beta in measuring
the relevant risk of both an individual security and a portfolio
23. Explain the CAPM and its relationship to the SML
24. Review the basic bond valuation model
25. Discuss bond value behaviour, particularly the impact that required return and
time to maturity have on bond value
26. Perform basic common stock valuation using each of three models: zerogrowth, constant-growth and variable growth
27. Understand the relationships among financial decisions, return, risk and stock
value
28. Review the contents of the stockholders’ report
29. Understand who use financial ratios and use ratios to analyse a firm’s liquidity
and activity
30. Use a summary of financial ratios and DuPont system of analysis to perform a
complete ratio and analysis
31. Understand the key capital expenditure motives and the steps in the capital
budgeting process
32. Define basic capital budgeting terminology
33. Discuss and calculate the major components of relevant cash flows, initial
investment, operating cash inflows and the terminal cash flow
34. Calculate, interpret and evaluate the payback period, NPV and IRR
35. Understand the basic concept of cost of capital and the specific sources of
capital it includes
36. Determine the cost of long-term debt, the cost of preferred stock and the cost of
common equity
37. Find the weighted average cost of capital
SUMBER RUJUKAN UTAMA
1.
Gitman, L. J. & Madura, J. (2001), Introduction to Finance, United States,
Addison Wesley
SUMBER RUJUKAN
TAMBAHAN
1.
Faudziah Zainal Abidin, Nasruddin Zainuddin, Faizal Ismail dan Nurwati
Ashikkin Ahmad Zaluki (2001), Prinsip Pengurusan Kewangan, edisi ke-2,
Prentice Hall
Gitman, L.J, 2003, Principles of Managerial Finance, 10th edition, United
States, Addison Wesley
2.
TAJUK MATA PELAJARAN DAN NILAI JAM KONTAK
TAJUK MATAPELAJARAN
The Financial Environment: Firms, Investors and Markets

What is finance?

Components of financial environment: financial managers, financial
markets and investors

Integration of components in the financial environment

Investor monitoring of firms

Effects of asymmetric information

The international finance environment
JAM
KULIAH
JAM
TUTORIAL
JAM
PRAKTIKAL
3
2
-
Financial Institutions and Markets

Financial institutions: commercial banks, mutual funds, securities
firms, insurance companies, pension funds, comparison of the key
financial institutions

Overview of financial markets

Key types of securities: money market securities and capital market
securities

Major securities exchanges
3
2
-
Corporate Securities: Bonds and Stocks

General features

Bond ratings

Differences between debt and equity capital

Common stock and preferred stock

The role of the investment banker
3
1
-
Interest Rate Fundamentals

Risk-free versus real rate of return

Term structure of interest rates and theories of term structure

Risk premium
3
1
-
Time Value of Money

Future value versus present value of a single amount

Annuities: ordinary annuity and annuity due

Mixed streams

Compounding more frequently than annually
3
1
-
Return and Risk

Calculating rate of return

Sources of risk

Risk aversion

Risk of single asset and risk of portfolio

The capital asset pricing model (CAPM)
3
1
-
Valuation

Basic valuation model

Bond valuation

YTM

Semi-annual interest and bond values

Common stock valuation: Zero-growth model, constant-growth model
and variable growth model
6
1
-
Financial Statement Analysis

The stockholders’ report: income statement, balance sheet, statement
of retained earnings and statement of cash flows

Using financial ratios: liquidity ratios, activity ratios and profitability
ratios, DuPont system of analysis
6
1
-
Capital Budgeting: Cash Flow Principles

Major cash flow components: expansion versus replacement cash
flows

The relevant cash flows
3
1
-
Capital Budgeting Techniques: Certainly and Risk

Payback period

NPV

IRR
3
1
-
Cost of Capital

The basic concept and the cost of specific sources of capital

The cost of long-term debt

Preferred stock

Common stock

The weighted average cost of capital
3
1
-
Capital Structure and Dividends

Types of capital

The optimal capital structure

Divided fundamental and dividend policy

Forms of dividends
3
1
-
JUMLAH JAM KULIAH KURSUS (14 MINGGU)
42
14
-
JUMLAH JAM KREDIT (14 MINGGU)
3.0
1.0
-
Date
Reviewed By
Approved By
Revision
02