College of Business, Illinois State University
                                   Spring 2011

COURSE:                FIL 445 Advanced Corporate Finance

PREREQUISITE:          FIL 440

INSTRUCTOR:            Dr. S. J. Chang, Professor of Finance and Associate Dean

INSTRUCTIONAL          Cases, articles, problem sets, and other handouts will be either
MATERIALS:             distributed in hard copies or made available online as the course
                       progresses. Students are recommended to keep a regular finance
                       textbook available throughout the course.

TIME:                  Wednesday, 4:00-6:50 p.m.

LOCATION:              145 COB

OFFICE:                201 COB (Phone: 438-8386)


OFFICE HOURS:          Wednesday, 3:00 – 4:00 p.m. and by appointment

OBJECTIVES:            This topic-oriented advanced finance course purports to:

        1. Provide advanced in-depth knowledge in major issues of corporate financial
           management building on the fundamental concepts from prerequisite courses;

        2. Develop abilities to identify as well as solve financial problems in real
           corporate situations, and provide opportunities for applying the textbook
           theories and models in real corporate finance situations;

        3. Explore the changing roles of corporate finance focusing on the trends of
           managerial consciousness in ethics, sustainability, globalization and
           diversity in financial markets, and their implications on how for-profit,
           mainstream business can improve overall social conditions;

        4. Provide an exposure to, and understanding of, emerging finance issues, such
           as corporate risk management and financial engineering, behavioral finance,
           corporate governance, interaction between finance and other business
           disciplines, and social impact issues.

Watch out, it will be the finance that doesn’t quite look, sound, or smell like the usual
conventional one. There will be no spoon-feeding in this course.
College of Business Missions Statement

The mission of the College of Business is to enhance lives, advance organizations, and
strengthen society through our teaching, research and service. In order to accomplish this
• We endeavor to prepare business professionals who possess high ethical standards
    and are productive citizens in a dynamic global environment through our excellence
    in instruction and our distinctive undergraduate and masters' level graduate programs;
• We actively engage in knowledge creation through our scholarship and intellectual
• We actively pursue citizenship and service to our disciplines, our departments and
    college, the university, our community and the global environment.

Academic Integrity

All students are expected to be familiar with COB’s "Standards of Professional Behavior
and Ethical Conduct" (refer to Students
are also encouraged to get acquainted with the United Nations Principles for Responsible
Management Education (PRME).

Please note that only bottled water may be consumed in the classroom wing of the
College of Business Building and that all cell phones and other electronic devices should
be turned off and stored away during classes unless permission is otherwise granted by
the instructor.


1. Take-Home Midterm (40 points)

   The only test in the course will feature take-home essay questions.

2. Group Presentation (35 points)

   Teams will be formed and assigned a set of specific articles for analysis and class
   presentation. Teams are expected to thoroughly read the assigned articles and
   conduct extensive research on the issues identified. A summary handout and
   PowerPoint presentation are recommended. Presentation will be evaluated by both
   the instructor and peer students who are expected to participate in the discussion.

3. Participation (25 points)

   This course puts strong emphasis on student participation in class discussion. All
   students are expected to participate actively in discussion, and failure to turn in
   evaluation of other groups’ presentations will hurt the student’s score in this category.

Date              Topics
1/12              Introduction, What is Finance, Changing Nature and Role of

1/19              Stakeholder Theory, Agency Theory

1/26              Corporate Social Responsibility, Sustainability, and PRME

2/02              Financial Ethics, Financial Valuation (Case 1)

2/09              Financial Statements, Ratios (Case 2), Financial Forecasting (Case 3)

2/16              Short-Term Financial Management (Case 4), Capital Budgeting (Case 5)

2/23              Risk, Portfolio Theory, Beta, the CAPM and beyond

3/02              Take-home Midterm

3/16              In Defense of Beta Presentation 1

3/23              Capital Structure and Cost of Capital (Case 6) Presentation 2

3/30              Market Efficiency or Inefficiency Presentation 3

4/06              Behavioral Finance, Psychology and Finance Presentation 4

4/13              Derivatives, Financial Engineering, Real Options Presentation 5

4/20              Financial Risk Management, Corporate Hedging Presentation 6

4/27              Globalization and Finance, Corporate Governance and Cultural
                  Issues Presentation 7

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