Programme & Unit Catalogues - University of Bath

School of Management, Unit Catalogue 2007/08

MN50228 Financial management

Credits: 6

Level: Masters

Modular: no specific semester

Assessment: EX 100%

Requisites:

Aims: The understanding and management of any organisation requires particular attention to financial performance. This unit aims to make candidates fluent in the use of accounting terminology and able to compile and interpret financial statements. The unit also provides an insight into the role of accounting and management information for decision-making and control. Project appraisal techniques are evaluated.
Learning Outcomes:
On successful completion of this unit, students should be able to: i. describe concisely the proper use of financial statements for limited companies and construct elementary company accounts; ii. use ratio analysis as a preliminary means of benchmarking; iii. use the financial accounting techniques of the syllabus for performance planning and control; iv. evaluate the business merits of alternative engineering projects; v. demonstrate the ability to communicate with other business disciplines using conventional management accounting terminology; vi. present a business case, using financial accounting evidence, to justify any engineering endeavour.
Skills:
Students will have at least three years of professional career experience and, generally, be in full-time employment. Consequently, the following overall transferable skills will be enhanced by this unit (and the other five units making up the Postgraduate Certificate in Engineering Management).
* Ability to design and complete a personal programme of study;
* Ability to research learning material;
* Team working with colleagues and communications skills;
* Ability to apply reflective learning to their company and own personal circumstances;
* Ability to challenge the status quo and find innovative solutions to business problems. Against this background, this unit will encourage particularly:
* The intellectual skill to integrate new knowledge with past experience and effectively apply it to future programmes of work;
* The professional skill to analyse operational issues both within and outside the organisation;
* The key ability to propose new business projects and business operations based on sound financial principles.
Content:

1. The Objectives of Management Accounting: 1.1. Information for managerial decisions; 1.2. Planning; 1.3. Controlling revenues and costs; 1.4. Coordination
2. Accounting Principles and Concepts
3. Examination of the main Financial Statements: 3.1. The Balance Sheet; 3.2. The Profit and Loss Account; 3.3. Funds Flow Analysis; 3.4. The difference between cash flows and profits; 3.5. Accounting ratios (as preliminary means of benchmarking)
4. Decision Making Using Accounting Information: 4.1. Pricing; 4.2. Cost Clarification; 4.3. Break-even analysis; 4.4. Absorption and marginal costing; 4.5. Activity, job and batch costing; 4.6. Contribution to profit and overhead cost; 4.7. Overhead recovery
5. Planning and Control: 5.1. Responsibility costing and budgetary control; 5.2. Standard revenue, cost and variance analysis; 5.3. Stock control and purchasing; 5.4. Credit control; 5.5. Production efficiency and productivity
6. Capital Budgeting: 6.1. Cash flow forecasting; 6.2. Control of working capital expenditure; 6.3. Control of fixed capital expenditure
7. Capital Investment Appraisal Techniques: 7.1. Payback period; 7.2. The Accounting Return on Investment Method; 7.3. Discounted Cash Flow (DCF) analysis; 7.4. The effects of taxation and inflation; 7.5. The effects of uncertainty and risk
8. Cost/Benefit Analysis
9. The Cost of Capitaal: 9.1. The effects of 'gearing'; 9.2. The appropriate forms of finance.