LO1: Demonstrate comprehensive understanding on a variety of financial problems and/or financial opportunities which may be faced by an organisation within its life cycle.

The Learning outcome(s) assessed by this assignment are:

 

All learning outcomes assessed.

 

At postgraduate level you are expected to:

 

• Have a high standard of presentation, structure, layout and design
• Demonstrate appropriate coverage, critical appreciation and evaluation of relevant literature
• Demonstrate a critical understanding of key concepts and the application of theory to practical solutions

Show evidence of originality of thought and approach, and of creative problem solving ability

Learning Outcomes tested (from module syllabus)

LO1: Demonstrate comprehensive understanding on a variety of financial problems and/or financial opportunities which may be faced by an organisation within its life cycle.

LO2: Critically explain decision making in institutional environments related to corporate finance utilisation and planning and evaluate the sources of finance available to an organisation

LO3: Evaluate advantages and disadvantages of alternative sources of organisational finance and how these contribute to organisational growth including investment, financing and dividend policies and strategies and the conceptual and practical rationales for these.

LO4: Align finance, financial planning, decision making, and strategy to concepts of delivering shareholder value Discuss and evaluate the methods by which a company can grow: (e.g. through organic strategy or through mergers and acquisitions)

LO5: Demonstrate a critical awareness of the role and importance of research in the evolution of corporate finance and evaluate the determinants of a firm’s cost of capital and capital structure

LO6: Demonstrate effective decision making and judgement on matters related to prioritising choices for business investment projects and/or for the allocation of resources organisation

LO7: Critically appraise and understand how firms interact with the capital markets

Task:

Critically evaluate the sources of finance for capital-intensive projects for a company of your choice – listed on a Stock Exchange around the globe. Making use of finance literature, discuss the Agency theory, outlining potential conflict of interest that may arise in raising resources for the intended project.

 

Your chosen company must operate in one of the following industries of the Stock Exchange: Telecommunications & Utilities, Hospitality, Aerospace & defence, Pharmaceuticals & Biotech, Automobiles & parts.

 

 

Critically discuss the following using the listed company selected and

 

1. Write a brief introductory report on the activities of your chosen company identifying any capital-intensive project(s) they intend to undertake in the near future.
2. Critically evaluate the assumption in corporate finance literature that potential conflict may arise between shareholders and management in sourcing funds for investments.
3. Critically review the various external sources of finance available to your chosen company. These sources of finance must be clearly identified, carefully explained and distinguished.
4. Identify the factors that need to be considered by the management of your chosen company in settling for a specific type of financing for the intended investment.
5. Explain clearly any problems, limitations and assumptions that you need to make to address the above tasks.
6. Give comprehensive but concise recommendations on the capital structure of your chosen company and draw a conclusion.