MA5610 – Corporate Finance and Accounting for Engineers

 

 

 

MA5610 – Corporate Finance and Accounting for Engineers
Course Information
Semester
8
Course Code
MA5600
Course Name
Corporate Finance and Accounting for Engineers
Credit Value
3
Pre-requisites
None
Core/Optional
Optional

Hourly Breakdown

Theory
15
Small Group Activities
30
Practical
–
Assignment
–
Independent Learning
105

Course Aim

To introduce corporate finance and accounting concepts for engineering managers to function effectively in the industry.

Intended Learning Outcomes

  • approach: the role of an engineer in the financial goals of a firm.
  • apply: the costing and budgeting techniques for engineering projects and products.
  • appraise: investment decisions for engineering projects, products and services.
  • analyse: financing decisions for engineering projects and products.
  • appreciate: the role of financial statement analysis in the value creation of the firm.

Course Content (Only main topics & subtopics)

  • Introduction to Branches of Corporate Finance and Accounting: Financial goals of a firm: survive in business, avoid financial distress and bankruptcy, beat the competition, maximise sales or market share, minimise costs, maximise profits, and maintain steady earnings growth; the engineer’s role in the financial goals of a firm; fundamental financial concepts: time value of money; risk and return.
  • Costing and Budgeting Techniques for Decision-Making:Types and nature of costs; project costing: analogous estimation, bottom-up estimation, parametric estimation, three-point estimation, cost of quality, reverse analysis and vendor bid analysis, project management estimating software and expert judgment; services and product costing: activity-based costing vs traditional costing.
  • Investment Decisions: Process of capital budgeting; capital budgeting techniques – ARR, payback, NPV, IRR; effect of risk; inflation and tax on investment decisions; lifecycle costing; cost-volume-profit (break-even) analysis and decision making.
  • Financing Decisions: Financing requirements of a business; sources of finance and different classifications; life cycle financing; capital structure and cost of capital; operating budgets and cash budgets; working capital management: profitability vs liquidity.
  • Financial Statements and Analysis: Basic: Basic accounting concepts; accounting statements – balance Sheet; income statement; cash-flow statement; statement of retained earnings; key financial ratios; ratio analysis.

Teaching/Learning Methods

  • Lectures
  • Student Based Activities

Assessment Strategy

Continuous Assessment 50% Final Assessment 50%
Small Group Activities: 30%
Quizzes: 20%
Theory: 50%
Practical: –
Other: –

Recommended Reading

  • Lawrence, J. G. (2006). Managerial Finance (11th Edition). Pearson Education. ISBN:13: 978-0-13-354640-8.
  • Stephen R., Westerfield, R., Jordan, B. (2021). Fundamentals of Corporate Finance. 13th Edition. McGraw-Hill Education. ISBN: 1265553602,9781265553609.
  • Weetman, P. (2016). Financial and management accounting: an introduction (7th Edition). Pearson Education, England, New York. ISBN 978-0-273-71845-1.