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FAME-P13
PGDM 2013-15: Term-VI

Financial Analysis with Modeling in Excel (FAME)

Credits 3.0
Faculty Name Banikanta Mishra and Sagarika Mishra*
Program PGPBM
Academic Year and Term 2014-2015 Term-VI


1. Course Description: This course teaches you how to do financial analysis with the help of financial modeling, and how Excel can help in it. You would use Excel to solve many of the problems you had tackled in Financial Management and other courses. You would realize how Excel can remarkably facilitate tasks and can also aid you in handling multidimensional complex problems that would have been very difficult to tackle otherwise.

2. Student Learning Outcomes (typically 3-5 bullet points):
ü Be able to understand the building-blocks of financial analysis
ü Be able to appreciate how financial modeling can help in financial analysis
ü Be able to apply Excel towards financial modeling
ü Be able to understand how Excel can enrich financial decision-making

3. Required Text Books and Reading Material

The class discussions and handouts would be exhaustive and self-sufficient. But I would refer to the following books for topics they cover well; some of them are referred to in the Session Plan below by the two-letter code. For cases, you may need to refer to Case Problems in Finance by Carl Kester, Richard Ruback, and Peter Tufano (McGraw Hill International Edition, Twelfth Edition).

PP: Financial Modeling and Valuation: A Practical Guide to Investment Banking and Private Equity (Wiley Finance) [Hardcover] Paul Pignataro (Author), 2013

LM: Financial Modelling and Asset Valuation with Excel [Paperback] Morten Helbæk (Author), Ragnar Løvaas (Author), Jon Olav Mjølhus (Author), Routledge, 2013

MD: Introduction to Financial Models for Management and Planning, James Morris and John Daley, Chapman Hall / CRC Finance (Indian Edition), Taylor & Francis LLC, 2012

DF: Using Excel for Business Analysis, + Website: A Guide to Financial Modelling Fundamentals (Wiley Finance) [Paperback] Danielle Stein Fairhurst (Author), 2012

AD: Mastering Financial Modelling in Microsoft Excel 3rd edn: A Practitioner's Guide to Applied Corporate Finance (3rd Edition) (Mastering Series) [Paperback] Alastair Day (Author), 2012

JT: Building Financial Models (McGraw-Hill Finance & Investing) [Hardcover] John Tjia (Author), McGraw-Hill Finance, 2009

CS: Financial Analysis and Modeling Using Excel and VBA (Wiley Finance) [Paperback] Chandan Sengupta (Author), 2009

MR: Financial Modeling in Practice: A Concise Guide for Intermediate and Advanced Level (The Wiley Finance Series) Hardcover, Michael Rees (Author), 2008


4. Tentative Session Plan: No of Sessions [Reference]

I. Introduction to FAME: 1 [MD]
What is Financial Analysis?
What is Financial Modeling?
Financial Planning
Why use Excel?

II. Financial Modeling: 2 [MD]
Purpose of a Financial Model
Input
Constraints
Output
Analysis of the Output
Action Plan based on Output

III. Excel Commands and Functions: 3 [CS]
Logical
Mathematical
Financial
Statistical

IV. Excel VBA/Macro: 2 [Notes]
Mastering Excel Macro
Using Macro in Problem-Solving

V. Financial Statement Analysis: 2 [Notes]
Evaluating External Financing Requirement
Sales Policy
Purchase Policy

VI. Solving Problems on Time-Value-of-Money and Security Valuation: 2 [Notes]
Finding PV and FV
Finding NPV of Cash-flow Streams
Bond Valuation and Inferring Rd
Stock Valuation Using DDM



VII. Regression Analysis in Finance: 2 [Notes]
Regression Using Excel
Understanding the Regression Output
Using Regression for Forecasting
Using Regression for Financial Analysis
Applying Regression in CAPM-based Analysis

VIII. Option Analysis Using Excel: 2 [Notes]
Deriving Option Price Using Binomial Model
Deriving Option Price Using Black-Scholes Model
Inferring Option Volatility

IX. Solving Capital-Budgeting Problem using Excel: 2 [Notes]
Evaluating a Capital Investment Decision
Scenario Analysis
Sensitivity Analysis

X. Using Excel for Advanced Capital-Budgeting Problems: 2 [Notes]
Evaluating a Merger or Takeover
Decision-Tree Analysis Using Binomial Model
Evaluating Real Option Using Excel


6. Evaluation:
CP (Class Participation) 15%
CR (Two Brief Case Reports) 20%
PA (Problems/Assignments) 25%
FE (Final Online Exam) 40%

CP: Your score on this front would depend on your attendance and your involvement in the class discussions (especially answering questions and raising interesting issues).

CR: We would discuss a case each in the 6th (Week-3) and 18th (Week-9) class. So, there would be two in all. You should submit, at the beginning of the class, a Group Case Report - in hardcopy format - addressing merely those questions assigned by me below, which would require you to focus only on selected parts of the case. Even if you opt not to submit Case Report for any case, I urge you to study the case, so that you can enjoy and learn when we discuss it in the class. Here are the case questions.

PA: Some mini-cases or assignments (maximum five) would be given to you from time to time to test how well you are picking up the use of Excel for financial modeling and analysis. These may be individual or group assignments.

FE: This would be a closed-book exam held in computer labs. You would be allowed to bring in one A6-size paper, writing whatever you want on its two sides. Questions would be both conceptual and numerical.


7. Code of Ethics:

You must abide yourself by the (unwritten) Code of Ethics for Students. For individual (group) assignments/examinations/projects, it is unethical to seek any direct help from others (other groups), whether or not you make use of the help. Besides, other forms of dishonesty (like plagiarism) would also invite severe punishment. Moreover, for a group assignment, all members of the group should contribute to the preparation of the report (no free-riders), and no direct help should be sought or taken from persons outside the group. Discussion among individual students and groups (except in the examination hall or class-room) is, of course, always encouraged. But, the final report or solution should be totally in your (your group’s) own style and language; any form of copying from another student (or group) or from any outside source is a serious offense. Moreover, you (or, wherever relevant, each member of your group) must fully and clearly understand every word and every step written in your (your group’s) report.
Your basic purpose should be to learn, without resorting to any unfair means for getting a higher score/grade. If you resort to any unfair means, including, but not limited to, the ones mentioned above, you would receive an F in the course; I may also recommend to the Institute for further penalty.


8. Academic Integrity (taken verbatim from the University of Texas, Dallas, format):

The faculty expects from its students a high level of responsibility and academic honesty. Because the value of an academic degree depends upon the absolute integrity of the work done by the student for that degree, it is imperative that a student demonstrate a high standard of individual honor in his or her scholastic work.

Scholastic dishonesty includes, but is not limited to, statements, acts or omissions related to applications for enrollment or the award of a degree, and/or the submission as one’s own work or material that is not one’s own. As a general rule, scholastic dishonesty involves one of the following acts: cheating, plagiarism, collusion and/or falsifying academic records. Students suspected of academic dishonesty are subject to disciplinary proceedings.

Plagiarism, especially from the web, from portions of papers for other classes, and from any other source is unacceptable and will be dealt with under the university’s policy on plagiarism (see general catalog for details). This course will use the resources of turnitin.com, which searches the web for possible plagiarism and is over 90% effective.

Created By: Alora Kar on 08/13/2014 at 03:34 PM
Category: BM-II T-VI Doctype: Document

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