Economics & Social Sciences Financial Management for Small & Medium Sized Companies Code: 4334 ECTS credits: 7.2 Bachelors / Masters:

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1 1. GENERAL SUBJECT DATA University: Degree Course: Departament: Subject: Universidad Politécnica de Valencia (Campus of Alcoy) Business Management Economics & Social Sciences Financial Management for Small & Medium Sized Companies Code: 4334 ECTS credits: 7.2 Bachelors / Masters: Bachelors Academic year: Duration: Semester 1 Semester 2 Annual Subject type: Obligatory Optional Lecturer/s: Tutorials: Timetable: M,T,W. 12:00-14:00H. Pla-Santamaria, David Office: F2D4 2. GENERAL DESCRIPTION OF THE SUBJECT To develop an understanding of the nature and the application of financial statement analysis. 3. OBJECTIVES (COMPETENCES) To develop an understanding of the nature and the application of financial statement analysis. - Balance sheet information - Income statement information - Cash flow statements - Profitability analysis - Ratio analysis and interpretation - Forecasts analisys To get ready and defend publicly a report about the concluding remarks on the analysis. 4. PREVIOUS KNOWLEDGE Basic concepts in: - Accounting. - Spreadsheets.

2 5. CONTENTS: UNITS UNIT 1: Asset Valuation 1.1. Introduction 1.2. Current Assets Valuation 1.3 Non Financial Fixed Assets Valuation UNIT 2: Financial Structure of the Firm 2.1. Introduction 2.2. Equilibrium: invested assets-financed assets 2.3. Working Capital: Long Term Financial Solvency of the Firm 2.4. Cash Flow: Short Term Financial Solvency of the Firm UNIT 3: Amortization Financing 3.1. Introduction 3.2. Amortization Models 3.3. Financial Use of the Amortizations. UNIT 4: Retained Profit Financing 4.1. Introduction 4.2. Retained Profit on the Balance Sheet 4.3. The Multiplier Effect of the Retained Profit 4.4. Advantages of the Retained Profit 4.5. Disadvantages of the Retained Profit 4.6. The Dilemma: Retained Profit or External Financing UNIT 5: Accounting and the Reality of the Firm 5.1. Introduction 5.2. Internal growth 5.3. Analysis of the Debt/Equity ratio 5.4. Borrowing Capacity 5.5. Borrowing Term 5.6. Inflation Effect UNIT 6: UNIT 7: Working Capital and Liquidity Management 6.1. Introduction 6.2. Amortizations 6.3. Provisioning 6.4. Financial Expenses 6.5. Works on the Properties 6.6. Windfall Profit 6.7. Financial Statements and Firm Valuation Short Term Financing 7.1. Introduction 7.2. Current Assets and Liabilities: Concept and Relevance 7.3. Time Evolution of the Current Assets 7.4. Current Assets Management 7.5. Current Assets and Inflation 7.6. Managerial Aspects of the Working Capital 7.7. Current Assets Management 7.8. Cash in and Cash out Management 7.9. Cash Budget, Cash Management and Idle Resources Cost Ideas Defining Cash Policy Applications on Cash Assets UNIT 8: Finance Budget

3 8.1. Introduction 8.2. Necessity and Relevance of Short Term Financing 8.3. Supplier Loan and other Spontaneous Financing Sources 8.4. Short Term Bank Loans 8.5. Short Term Bank Loan Types 8.6. Factoring Firms 8.7. Income Rights Selling Financing: Factoring Service UNIT 9: Financial Forecasting 9.1. Introduction 9.2. Developing Cash Budget Report 9.3. Forecasting Income Flows 9.4. Forecasting Outcome Flows 9.5. Different Ways to Hand in the Cash Budget 9.6. Cash Budget: Usefulness and Limits 9.7. Interim Balance Sheet 9.8. Provisional Operating Account 9.9. Relationship Between the Cash Budget and the Provisional Financial Statements UNIT 10: Long Term Financial Budget Introduction Capital Budget Model Limits. 6. TEACHING-LEARNING METHODOLOGY CLASSROOM ACTIVITIES ACTIVITIES DESCRIPTION ECTS (hours) LECTURE BASIC DESCRIPTION OF THE 1 RELEVANT CONCEPTS SEMINARS IN-DEPTH ANALISIS OF MOST 1 USED CONCEPTS CASE-STUDIES EXAMPLES OF REAL BUSINESS 1 LIFE COMPUTER LAB BASIC DESCRIPTION OF 1 SPREADHEET TOOLS FOR FINANCIAL MANAGEMENT AND APPLICATION

4 ACTIVITIES AT HOME (AUTONOMOUS WORK) ACTIVITIES DESCRIPTION ECTS (hours) PROJECT PROJECT DEVELOPEMENT ON SOME FIRM EVALUATION The evaluation of the subject will be carried through the following weights: Theory exam 14% Seminars 14% Problems and Case-studies 14% Computer labs 14% Homework (Activities) 44% The strategy is using diverse evaluation procedures trying to increase their effectiveness by mixing them up. In this way we try to account objective parameters related with the learned concepts but also to account the level of developed abilities. 8. BIBLIOGRAPHY BASIC: Ballestero, E. (1990) Principios de Economía de la Empresa. Alianza Editorial. 9ª Ed. Romero, C. (1996) Introducción a la Financiación Empresarial y al Análisis Bursátil. Alianza Editorial. 5ª Ed. Ballestero, E. (1993) El Balance. Alianza Editorial. 9ª Ed. Romero, C. (1993) Técnicas de Gestión de Empresas. 3ª Ed. Mundi-Prensa Romero, C. (1997) Evaluación financiera de inversiones agrarias. Mundi- Prensa. 6ª Ed- Pérez-Carballo, A. (1997) Principios de gestión financiera en la empresa. Suárez-Suárez, A. (1996) Decisiones óptimas de inversión y financiación en la empresa. Fernández Blanco, M. (1991) Dirección financiera de la empresa. COMPLEMENTARY: FK. Reilly. (1985) Investment Analysis and Portfolio Management. The Dryden Press. Brealey, R. A., Myers, S.C., Marcus, A.J. (1996) Principios de dirección financiera.

5 Haugen, R (1997) Modern Investment Theory. 4th Edition. Upple Saddle River, New Jersey. Gitman, L. and Joehnk, M. (1996) Fundamentals of Investing. Harper Collings College Publishers. UPV PUBLICATIONS. Apuntes Prácticos De Economía De La Empresa: Inversión Y Financiación. Ref: