Golden Gate University

ACC351A - Economics, Finance and International Business for Accountants

Fall 2009

Required Texts
Fundamentals of Financial Management by Brigham and Houston, 12th Edition
by Patrick R. Delaney, Barry J. Epstein, Ralph Nach
Freakonomics by Levitt and Dubner

Required Tool
Financial Calculator, which is designated by having the following symbols: n, i, pmt,
FV, PV. I would recommend the HP10BII financial calculator, which will cost you
about $30.

Instructor Contact Information

The best time to contact me during the week is during the evening from 8pm to midnight.

Philip Neyland
510-417-1911
Pqneylandggu@gmail.com

Instructor Bio
I have over 20 years of corporate business experience, currently as Strategic Finance Manager at
Kaiser Permanente. Immediately prior, I was a VP at Bank of the West in Risk and previous to
that I was at Schwab as a Director in its Treasury Department. Prior to Schwab I was employed
at Kaiser Permanente, Pepsico and American Express.

I have been teaching accounting and finance for more than 10 years at various schools in the
Bay Area. I originally started teaching as a way to find a productive outlet for my excess energy,
but I have come to really enjoy bringing the real world of business into the classroom.

Course Description: This course focuses on economics, finance, and international business as
these topics are important to accountants. Specifically, the topics covered are domestic and
international finance markets and institutions, interest rates, bond valuation, cost of capital,
capital structure and leverage, working capital management, and hybrid financing including
leases. I place an emphasis on financial analysis and the impact of decision making on financial
statements. Prerequisite: ACCTG 50.

Note that the book is a supplement to the topics that we will cover in class. As I am a practical,
business oriented instructor, the book will serve to provide the theoretical and conceptual
foundation for the topics that will be covered.

To fulfill the obligations of the course and to gain a true understand, you will have to do the
problems assigned along with the chapter reading. To ensure that you have a thorough
understanding of the coursework, assignments will be augmented with cases and selected
articles from the business world. Moreover, we will discuss the ethical implications of possible
decisions and outcomes.

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Your class participation and attendance is essential to your success in, and the general
success of this course. Simply reading the chapters will only serve as the basis for the beginning
of your understanding of the course material. Your questions will be appreciated by your
classmates as they likely have the same or similar questions. Specifically your comments
regarding your work experiences are especially helpful in making the link from academia to the
real world. Class participation is defined as speaking in class, offering your opinions and
experiences and questioning the instructor and others. YOU WILL NOT BE AWARDED CREDIT
FOR SIMPLY SHOWING UP TO CLASS. In order to earn a high participation grade in class, you
will have to actively contribute. The following table provides guidelines on participation:

GRADE ATTRIBUTES
90 – 100% Contributions are prompt, timely, relevant, self-initiated; remarks are raised
consistently on all assignments throughout the course
80 – 89% Student generally keeps up with the discussion. Needs some prompting to
contribute.
70 – 79% Participation is inconsistent; picks and chooses topics to get involved.
Demonstrates little initiative.
50 – 69% Some participation, makes relevant remarks
Less than 50% No participation

We will cover a lot of material in this course and it is imperative that you keep up with the
material! There is no extra credit assigned in this course as there is more than enough work to
do listed on the syllabus.

I reserve the right to alter the course, particularly to make it more relevant.

Grading
Your grade will be based on homework, class participation, cases, group presentations and tests:

Class Participation 10.0%

Group Project I 7.5%
Group Project II 7.5%
Homework 25.0%
Midterm 25.0%
Final Exam 25.0%
Total 100.0%

There will be no additional assignments given for extra credit. Please put your effort
into doing the best you can during the 15 weeks of the course rather than lobbying for your
grade at the end of the course. I do not negotiate grades.

Grading Scale
A 95+
A- 90-94
B+ 86-89
B 83-85
B- 80-82
C+ 76-79
C 73-75
C- 70-72
D 60-69
F < 60
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The grade you earn will be based upon the work you do and is your responsibility.

Assignments
Assignments are due at the beginning of each class. Please make a copy and keep that for
yourself and turn the original in at the BEGINNING of each class. Homework is practice and I do
not expect your homework to be perfect, but I do expect you to have made a significant effort in
every problem. Your effort will enhance your learning and enable you to ask relevant, stimulating
questions during class.

Late Assignments will be accepted only for the following week and will be penalized 50%. Late
assignments will not be accepted beyond the one week time period.

GROUP PRESENTATION ASSIGNMENTS

You are to present as if you have 15 minutes with the CFO to make a recommendation for a
particular course of action. You should cover, major assumptions, significant changes to the
balance sheet, income state and financial ratios. The presentations are to be in PowerPoint and
contain a maximum of 8 slides. Your font should be at least 28 point so that the class can easily
view your words. Moreover, you want to highlight key points and not every point. Your
presentation (deck) should include supporting analytic schedules that are attached, but not for
viewing. You will be given two separate handouts for each presentation.

The exams will be open book and open note. Make up exams will not be given, but a student
may take the test prior to the regularly scheduled date with proper advanced notification to the
instructor.

ASSIGNMENTS

Jan 11 - Class 1
Course Introduction
Chapter 1 – Overview of Financial Management
SOX Overview

Learning Outcomes
Students will be introduced to:

World Macroeconomic Systems

Various forms of business organizations

SOX and basic financial controls

The difference between accounting value and economic value

Jan 25 - Class 2
Chapter 3 – Financial Statements, Cashflow
Problems: 3-7, 3-8, 3-11, Case 3-1
Handout: Betty Vinson Reading and Questions

Learning Outcomes
Students will be introduced to:

Application of ethics and SOX in the workplace

Financial Statement Analysis

The relevance of cashflow and how to calculate

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Feb 1 - Class 3
Chapter 5 – Time Value of Money
Problems: 5-1, 5-2, 5-5, 5-8, 5-22, 5-30

Learning Outcomes
Students will be introduced to:

The fundamentals of Time Value of Money

How to calculate Time Value of Money using a financial calculator (and any similar tool)

Feb 8 - Class 4
Chapter 1 Freakonomics
Chapter 7 – Bonds and Their Valuation
Problems: 7-1, 7-2, 7-5, 7-7, Bond Handout

Learning Outcomes
Students will be introduced to:

How to calculate the price of bonds

How to account for bonds and their impact on financial statements

The relevance of rating agencies on rates

Feb 22 - Class 5
Chapter 2 Freakonomics
Chapter 4 – Analysis of Financial Statements
Problems: 4-5, 4-15, 4-21

Learning Outcomes
Students will be introduced to:

Broad classification of company types

Types of ratios and metrics including financial ratios and trending

How to create pro forma financial statements

Calculation of after tax income and after tax cashflow

Feb 29 - Class 6
Chapter 6 – Interest Rates
Problems: 6-1, 6-14

Learning Outcomes
Students will be introduced to:

How capital markets function.

The different types of financial markets

Theories about how the stock market functions

What affects the cost of money

Mar 1 – Class 7

MIDTERM

Mar 8 - Class 8
Chapter 2 – Financial Markets and Institutions
Case 2-1 (Very Brief Answers!)
Chapter 8 – Risk and Rates of Return
8-1, 8-3, 8-5, 8-11

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Learning Outcomes
Students will be introduced to:

How capital markets function.

The different types of financial markets

Theories about how the stock market functions

What affects the cost of money

Practical uses of standard deviation and correlation

GROUP PRESENTATION I DUE

Mar 15 – Class 9
Chapter 3 Freakonomics
Chapter 9 – Stocks and Their Valuation
Problems 9-5, 9-12, 9-15

Learning Outcomes
Students will be introduced to:

How considerations about stock impact corporate decisions and strategy.

The theory behind methods used to value stock

The variety of stock markets that exist

Firm valuation using free cash flow model

Mar 22 – Class 10
Chapter 4 Freakonomics
Chapter 10 – The Cost of Capital
Problems 10-5, 10-10, 10-18
Do WACC for Nike, Boeing and Microsoft using CAPM

Learning Outcomes
Students will be introduced to:

The relevance of capital to a firm’s survival

The components of capital

The calculation of the cost of capital and WACC

Mar 29 – Class 11
Chapter 5 Freakonomics
Chapter 11 – The Basics of Capital Budgeting
Problems 11-6, 11-7, 11-14, 11-15, 11-18

Learning Outcomes
Students will be introduced to:

Capital rationing and the importance of capital budgeting on firm valuation

Capital budgeting rationale and payback

Discounted cashflow analysis including, NPV, IRR and MIRR

Apr 5 – Class 12
Chapter 12 – Cash Flow Estimation and Risk Analysis
Problems 12-1, 12-3, 12-8, 12-10

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Learning Outcomes
Students will be introduced to:

Cashflow estimation in capital budgeting

How to identify relevant costs

Incremental/marginal costing

Apr 12 – Class 13
Chapter 21 Mergers and Acquisitions
Problems: 21-1, 21-5

Learning Outcomes
Students will be introduced to:

What causes M&A activity.

What type of analysis is performed for M&A valuations.

The benefits or issues with M&A activity.

Apr 19 – Class 14
Chapter 6 Freakonomics
Chapter 19 Multinational Financial Management
Problems: 19-1, 19-2, 19-3

Learning Outcomes
Students will be introduced to:

Calculation of exchange rates

Special considerations for international business
.

GROUP PRESENTATION II DUE

Apr 26 – Class 15

FINAL EXAM

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