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   Course Title    Financial Managers' Development Program
Lecturer    Hele Hammer
Institution    The Pskov Branch of S.-Petersburg Academy for Engineering and Economics
Country    Russia


 

This program is designed to enhance and systematize the knowledge of experienced financial managers in VALUE-BASED MANAGEMENT.

 

Modern management thinking views shareholder wealth maximization (increasing the market value of the firm) as the primary goal of decision making. To increase value, managers must understand the sources of value, how to increase value in the various decision making areas that comprise financial management and the best techniques to measure it. This program is aimed at helping financial managers do all this:

  • understand the sources of value;
  • understand different valuation techniques;
  • understand how to apply these tools and methods in practice.

Throughout, the program emphasizes the integration of a company's business and financial strategies.

 

Program modules deal with a number of financial topics in detail. These include traditional areas of finance (financial planning, investing and financing decisions, risk and return, etc.) as well as more contemporary ones (how information technology affects strategy implementation, risk management, value based performance evaluation, etc.)

 

The program is systematic and integrated. Topics are arranged into logical modules. Interconnections among the topics are demonstrated throughout the program as well as the importance of each topic for enhancing firm value. Modules build on preceding topics where appropriate and allow participants to explore complex topics sequentially, without repeating material already presented.

 

Participants are expected to have at least an intermediate level of knowledge and experience in finance. They will form teams to analyze case studies and problem solving.

 

The program is organized into ten two-day modules, or twenty days altogether. The studies are carried out over ten months (a two-day module each month). Program length is 160 academic hours, plus independent study time.

 

Participants with a bachelor's degree have the opportunity to apply for 10 credit points in the EBS Executive Master of Business Administration (EMBA) program. In order to acquire the credit points, it is necessary to complete and submit for review five homework activities (case analysis, essay questions and problem solutions) and pass a comprehensive final exam.

 

MODULES (TOPICS COVERED):

 

1. INTRODUCTION TO THE PROGRAM / ORGANIZATIONAL STRATEGY

Hele Hammer and Mari Avarmaa / Tiit Elenurm

  • Structure and goals of the program: the nature of corporate finance, the goal of financial management, new theories etc: introduction to the program
  • Main elements of strategy: mission, vision, competitive advantage, core competence
  • The impact of the changing environment on strategic choices. Developing and clarifying strategy. Using teamwork and expertise in strategic planning
  • The role of representatives of different functional areas in creating and implementing strategy
  • Business Ethics and organizational co-operation

Sept 18-19

 

2. TEAMWORK/ ACCOUNTING VS. FINANCE

Anu Virovere / Heidi Seeland , Enn Listra

  • Day I: Teamwork. The role of an individual, teamwork and organizational culture-the basis for successful strategic management.
  • Day II: Accounting vs. Finance. The role of financial and managerial accounting in implementing the strategy of the corporation 1.5 h
  • Modern theories and trends in financial and managerial accounting (ABC etc) 3 h
  • Accounting vs. Finance 1.5 h

Oct 24-25

3. FINANCIAL PLANNING / IT IN IMPLEMENTING THE (FINANCIAL) STRATEGY

Hardo Pajula, Toomas Reisenbuk, Heidi Seeland/ Toomas Veersoo, Ivo Suursoo

  • Day I: Financial planning Global background: Economy in Estonia and elsewhere. Macroeconomic factors to consider.
  • Inputs into long-term plans: the growth of the economy, inflation, etc.
  • A case study of a company. Sales plan, investments plan, cash flows etc.
  • Day II: IT in implementing the (financial) strategy. Business strategy and processes: implementing a compatible IT system
  • Financial planning and management with the help of IT: maximize the benefit from IT.

Nov 20-21

4. FINANCIAL INVESTMENTS

Aadu Oja, Laire Puhmaste, Kristel Kivinurm, Toomas Reisenbuk

  • Time value of money (quick overview)
  • Valuation of stocks, bonds, derivatives
  • Portfolio theory and making investment decisions.
  • Different investment strategies
  • Investment possibilities in Estonia, Baltics and elsewhere

Dec 13-14

5. CAPITAL BUDGETING

Hele Hammer, Mari Avarmaa, Enn Listra, Tõnu Pekk, Jason Grenfell-Gardner

  • Business strategy and investments. NPV and other investment criteria.
  • Project cash flows. A case study.
  • Scenario analysis, sensitivity analysis, Monte Carlo, decision trees, etc.
  • Real options

Jan 10-11

6. FINANCING DECISIONS

Tõnu Pekk, Wade Stokes, Rain Tamm, Alo Lillepea, Ivo Kallast

  • Cost of capital. Optimal capital structure (MM and others)
  • Sources of debt capital: bonds, loans from bank, etc.
  • Sources of equity capital: venture capital, IPOs, etc
  • Leasing and factoring

Feb 5-6

7. SHORT-TERM FINANCIAL MANAGEMENT

George A. Hachey & Anthony Cefalo

  • Measuring and Assessing a Firm's Liquidity
  • Managing Accounts Receivables, Inventory and Accounts Payable to Unlock Cash
  • Cash Forecasting
  • Short Term Financing Strategies
  • Investing Excess Funds

March 7-8

8. RISK MANAGEMENT

Enn Listra, Ivo Karilaid, Henn Oit, Martti Singi

  • Definition of risk and types of risk. Risk management and the value of a company.
  • Risks at the project, at the company, at the industry, and at macroeconomic levels.
  • Evaluation of risks, risk management methods and means, and interactions with other management techniques.
  • Financial risks. Diversification and hedging, derivative instruments.
  • Real risks. Internal control mehthods. Transfer of risks. Insurance.

April 4-5

9. VALUATION OF A COMPANY / PERFORMANCE EVALUATION

Gert Tiivas, Jason Grenfell-Gardner,  Ivo Suursoo, Madis Müller

  • Different valuation models (DCF, EVA, relative models, Balanced Scorecard). Value-based management. Strategy as a portfolio of real options.
  • Valuation of companies in practice from the viewpoint of internal and external stakeholders--a case study.
  • EVA as performance evaluation tool: overview and case study
  • Other performance evaluation methods

 

May 2-3

10. MERGERS AND AQUISITONS AND LEVERAGED BUY-OUTS / COMPREHENSIVE CASE STUDY

Mart Habakuk / Hachey & Wiggins, Avarmaa, Hammer

  • Mergers and aquisitions, leveraged buy-outs and other strategic considerations
  • A comprehensive case: presentations, negotiations and discussion.
  • Review of the program and conclusions.

June 6-7

 

 

HOMEWORK

 

Homework I : After module IV

Part a: Problems on time value of money, stock and bond valuation

Part b: Essay “Macroeconomic factors that influence my company in the coming 5 years”

Homework II  : After module VI

Case study: Valuation of a concrete project of your own company

 

Homework III: After module VII

Actionplan for a more effective short-term financial management in your company

 

Homework IV: After modul IX

Teamwork: preparing the case under discussion in last module + writing the presentation

Homework V: After module X

Comprehensive problems (to help prepare for the exam)

 

 

GRADING SYSTEM

 

Homework  1             8 points

Homework  2             8 points

Homework  3             8 points

Homework  4             8 points

Homework  5             8 points

Final Exam                60 points

 

Grade:

 

97…100            A+                              

93…96            A                                

89…92            A-                               

85…88            B+                              

81…84            B                                

77…80            B-                                   

73…76            C+

69…72            C

65…68            C-

61…64            D+

57…60            D

53…56            D-

…52               F



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