100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
Summary of key elements of SFM course material $8.57   Add to cart

Summary

Summary of key elements of SFM course material

1 review
 46 views  1 purchase
  • Course
  • Institution

Summary of key elements of SFM course material (indicates as 'notes') that can be used to practice for the exam, as well as being used as a cheat sheet during the open book exam.

Preview 2 out of 13  pages

  • December 14, 2022
  • 13
  • 2022/2023
  • Summary

1  review

review-writer-avatar

By: nataliehinkova • 6 months ago

avatar-seller
Notes
Strategic Financial Management
MSc BPS and Business Studies 2022-2023



Basics of Strategic Finance 2

Financial Statements and Financial Ratios 3

Time Value of Money and Investment Criteria 6

Risk and Value 9

, Basics of Strategic Finance
https://www.youtube.com/watch?v=iR7b2NjgAO8

Basic Laws of Finance:
1. Cash is King
2. Each financial statement tells a story
a. Balance sheet: snapshot of what a company owns (assets) and owes
(liabilities/equity) at a specific point in time.
b. Income statement: shows how revenue - expenses equal profit or loss. Also: how
sales - COGS = income or loss. ‘Movie of profitability’.
c. Cash flow statement: shows how a company got from the cash balance at the start
of the year to the cash balance at the end of the year, through cash in and
outflows throughout the year. ‘Documentary on cash flow’.
3. Profit is not the same as cash flow (accrual accounting)
a. Income statement vs cash flow statement
b. Revenue, costs, and profit are recognized as they are earned / incurred
c. Cash is recognized when received or paid out
4. High risks merit high returns (CAPM)
5. Efficient Capital Market / efficient market hypothesis (EMH)
a. The efficient market hypothesis (EMH) or theory states that share prices reflect
all information.
b. The EMH hypothesizes that stocks trade at their fair market value on exchanges.
c. Proponents of EMH posit that investors benefit from investing in a low-cost,
passive portfolio.
d. Opponents of EMH believe that it is possible to beat the market and that stocks
can deviate from their fair market values.
6. Book value is not the same as market value

Increase in Assets = Cash OUT
Decrease in Assets = Cash IN
Increase in Liabilities = Cash IN
Decrease in Liabilities = Cash OUT

Depreciation is not an expense, so it must be added back to the net income on the income
statement!

Income tax is paid over profit on sales (Q8 practice exam).

The 4 types of competition
1. Monopoly
a. A monopoly is a dominant position of an industry or a sector by one company, to
the point of excluding all other viable competitors. Often, products in this
competition are of a higher price and demand for them tends to be inelastic.
2. Oligopoly

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

Quick and easy check-out

You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.

Focus on what matters

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller sarahslager. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for $8.57. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

70055 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy study notes for 14 years now

Start selling
$8.57  1x  sold
  • (1)
  Add to cart