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Corporate Finance: A Practical Approach, Second Edition

Book Description

The book that fills the practitioner need for a distillation of the most important tools and concepts of corporate finance

In today's competitive business environment, companies must find innovative ways to enable rapid and sustainable growth not just to survive, but to thrive. Corporate Finance: A Practical Approach is designed to help financial analysts, executives, and investors achieve this goal with a practice-oriented distillation of the most important tools and concepts of corporate finance.

Updated for a post-financial crisis environment, the Second Edition provides coverage of the most important issues surrounding modern corporate finance for the new global economy:

  • Preserves the hallmark conciseness of the first edition while offering expanded coverage of key topics including dividend policy, share repurchases, and capital structure

  • Current, real-world examples are integrated throughout the book to provide the reader with a concrete understanding of critical business growth concepts

  • Explanations and examples are rigorous and global, but make minimal use of mathematics

  • Each chapter presents learning objectives which highlight key material, helping the reader glean the most effective business advice possible

  • Written by the experts at CFA Institute, the world's largest association of professional investment managers

Created for current and aspiring financial professionals and investors alike, Corporate Finance focuses on the knowledge, skills, and abilities necessary to succeed in today's global corporate world.

Table of Contents

  1. Cover
  2. Title
  3. Copyright
  4. Contents
  5. Foreword
  6. Acknowledgments
  7. About the CFA Institute Investment Series
  8. Chapter 1: Corporate Governance
    1. Learning Outcomes
    2. 1. Introduction
    3. 2. Corporate Governance: Objectives and Guiding Principles
    4. 3. Forms of Business and Conflicts of Interest
    5. 4. Specific Sources of Conflict: Agency Relationships
    6. 5. Corporate Governance Evaluation
    7. 6. Environmental, Social, and Governance Factors
    8. 7. Valuation Implications of Corporate Governance
    9. 8. Summary
    10. Problems
  9. Chapter 2: Capital Budgeting
    1. Learning Outcomes
    2. 1. Introduction
    3. 2. The Capital Budgeting Process
    4. 3. Basic Principles of Capital Budgeting
    5. 4. Investment Decision Criteria
    6. 5. Cash Flow Projections
    7. 6. More on Cash Flow Projections
    8. 7. Project Analysis and Evaluation
    9. 8. Other Income Measures and Valuation Models
    10. 9. Summary
    11. Problems
  10. Chapter 3: Cost of Capital
    1. Learning Outcomes
    2. 1. Introduction
    3. 2. Cost of Capital
    4. 3. Costs of the Different Sources of Capital
    5. 4. Topics in Cost of Capital Estimation
    6. 5. Summary
    7. Problems
  11. Chapter 4: Measures of Leverage
    1. Learning Outcomes
    2. 1. Introduction
    3. 2. Leverage
    4. 3. Business Risk and Financial Risk
    5. 4. Summary
    6. Problems
  12. Chapter 5: Capital Structure
    1. Learning Outcomes
    2. 1. Introduction
    3. 2. The Capital Structure Decision
    4. 3. Practical Issues in Capital Structure Policy
    5. 4. Summary
    6. Problems
  13. Chapter 6: Dividends and Share Repurchases: Basics1
    1. Learning Outcomes
    2. 1. Introduction
    3. 2. Dividends: Forms
    4. 3. Dividends: Payment Chronology
    5. 4. Share Repurchases
    6. 5. Concluding Remarks
    7. 6. Summary
    8. Problems
  14. Chapter 7: Dividends and Share Repurchases: Analysis1
    1. Learning Outcomes
    2. 1. Introduction
    3. 2. Dividend Policy and Company Value: Theory
    4. 3. Factors Affecting Dividend Policy
    5. 4. Payout Policies
    6. 5. Analysis of Dividend Safety
    7. 6. Summary
    8. Problems
  15. Chapter 8: Working Capital Management
    1. Learning Outcomes
    2. 1. Introduction
    3. 2. Managing and Measuring Liquidity
    4. 3. Managing the Cash Position
    5. 4. Investing Short-Term Funds
    6. 5. Managing Accounts Receivable
    7. 6. Managing Inventory
    8. 7. Managing Accounts Payable
    9. 8. Managing Short-Term Financing
    10. 9. Summary
    11. Problems
  16. Chapter 9: Financial Statement Analysis
    1. Learning Outcomes
    2. 1. Introduction
    3. 2. Common-Size Analysis
    4. 3. Financial Ratio Analysis
    5. 4. Pro Forma Analysis
    6. 5. Summary
    7. Problems
  17. Chapter 10: Mergers and Acquisitions
    1. Learning Outcomes
    2. 1. Introduction
    3. 2. Mergers and Acquisitions: Definitions and Classifications
    4. 3. Motives for Merger
    5. 4. Transaction Characteristics
    6. 5. Takeovers
    7. 6. Regulation
    8. 7. Merger Analysis
    9. 8. Who Benefits from Mergers?
    10. 9. Corporate Restructuring
    11. 10. Summary
    12. Problems
  18. Glossary
  19. References
  20. About the Authors
  21. About the CFA Program
  22. Index