Handbook : Unit informationEdith Cowan University

Faculty of Business and Law

School: Business

This unit information may be updated and amended immediately prior to semester. To ensure you have the correct outline, please check it again at the beginning of semester.

• Unit Title

  Fundamentals of Value Creation in Business

• Unit Code

  FBL5030

• Year

  2015

• Enrolment Period

  1

• Version

  1

• Credit Points

  20

• Full Year Unit

  N

• Mode of Delivery

  On Campus
  Online

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Description

The continued success of any business firm rests on its ability to create economic value for its customers. In this unit, students examine the options a firm may have to create value, and apply the economic, accounting and financial techniques used to evaluate the impact of those options on the firm's financial performance. These techniques enable managers to view decisions from a number of perspectives that allow them to understand their business and the risks it faces in its economic environment.

Learning Outcomes

On completion of this unit students should be able to:

1. Apply financial and accounting techniques to evaluate value creation options.
2. Develop and justify strategic options to drive economic value and create competitive advantage.
3. Evaluate the sources of economic value in a business.

Unit Content

1. Analysis of cash flows.
2. Capital budgeting techniques and analysis.
3. Economic perspectives on the nature and creation of value.
4. Financial statement analyses that enable managers to assess the financial position and performance of a business.
5. Interpreting transactions and how they impact on financial statements.
6. Markets, strategies and value.
7. Sources of funding, capital structure and weighted average cost of capital.
8. The behaviour of buyers and sellers in markets.
9. The external environment, risk, uncertainty and project options.

Additional Learning Experience Information

In on-campus mode, the unit will include face-to-face (i.e. seminars and plenary sessions) and on-line (e.g. discussion boards, blogs) activities, as well as self-paced learning activities. Off-campus students will access unit materials online and participate in online discussion, activities, readings, and self-paced work via Blackboard. This unit uses principles associated with authentic learning to introduce students to realistic business situations that require analysis using relevant concepts and skills. Students are required to take on the role of management advisors to a company investigating ways of creating economic value and achieving a competitive advantage over their rivals. Lecturers introduce the relevant economic, accounting and financial concepts and techniques, after which students investigate various scenarios in order to make justified decisions faced by risk and uncertainty. Industry leaders will feature as guest lecturers, enabling learners to make the connections between theory and practical application.

Assessment

GS1 GRADING SCHEMA 1 Used for standard coursework units

Students please note: The marks and grades received by students on assessments may be subject to further moderation. All marks and grades are to be considered provisional until endorsed by the relevant Board of Examiners.

Text References

• Brealey, R.A., Myer, S.C. & Allen, F. (2011). Principles of corporate finance: Concise edition (2nd ed.). New York: McGraw-Hill Irwin.
• Horngren, C., Datar, S., Foster, G., Rajan, M., Ittner C., Wynder, M., Maguire, W., & Tan, R. (2011). Cost accounting: A managerial emphasis (revised ed.). Frenchs Forest, N.S.W.: Pearson Australia.
• Maital, S. (2011). Executive economics: Ten essential tools for managers. New York: The Free Press.
• Penman, S. (2013). Financial statement analysis and security valuation (5th ed.). New York: McGraw-Hill Ryerson.

Journal References

• Harvard Business Review
• Journal of Business Venturing

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