Business finance : theory and practice [printed text] / Eddie McLaney, Author  . -  11th . - Harlow, Essex : Pearson Custom Publishing, 2017 . - xvi, 527 : ill. col ; 18mm.
ISBN : 978-1-292-13440-6 : €71.62
This book is an essential introduction to the world of financing and investment decision making. With a strong real world focus, this text aims to help you bridge the gap between the theories surrounding financial decision making and what happens in the real business world in an accessible, user-friendly way.

Alongside the book, you can visit the Business Finance companion website at www.pearsoned.co.uk/mclaney to access a comprehensive range of student-learning resources, including additional questions, web links for further reading and a glossary of key terms.

Class number:

658.15

Contents note:

Part One: The business finance environment 1 - Introduction 1.1. The role of business finance 1.2. Risk and business finance 1.3. The relationship between business finance and accounting 1.4. The organisation of businesses - the limited company 1.5. Corporate governance and the role of directors 1.6. Long-term financing of companies 1.7. Liquidation 1.8. Derivatives 1.9. Private equity funds 2 - A framework for financial decision making 2.1. Financial decision making 2.2. Business objectives 2.3. Conflicts of interest: shareholders versus managers - the 'agency' problem 2.4. Financing, investment and separation 2.5. Behavioural finance 2.6. Theory and practice 3- Financial [accounting] statements and their interpretation 3.1. Introduction 3.2. The financial statements 3.3. Definitions and convention of accounting 3.4. Definitions of accounting 3.4. Problems with using accounting information for decision making 3.5. Creative accounting 3.6. Ratio analysis 3.7. Using accounting ratios to predict financial failure Part Two: Investment decisions 4- Investment appraisal methods 4.1. Introduction 4.2. Net present value 4.3. Internal rate of return 4.4. Payback period 4.5. Accounting [or unadjusted] rate of return 4.6. Investment appraisal methods used in practice 5- Practical aspects of investment appraisal 5.1. Introduction 5.2. Cash flow or accounting flow? 5.3. Do cash flows really occur at year-ends? 5.4. Which cash flows? 5.5. Taxation 5.6. Inflation 5.7. A example of investment appraisal 5.8. Capital rationing 5.9. Replacement decisions 5.10. Routines for identifying, assessing, implanting and reviewing investment projects 5.11. Investment appraisal and strategic planning 5.12. Value-based management 5.13. Real options 6- Risk in investment appraisal 6.1. Introduction 6.2. Sensitivity analysis 6.3. Use of probability 6.4. Expected value 6.5. Systemic and specific risk 6.6. Utility theory 6.7. Attitudes to risk and expected value 6.8. Particular risks associated with making investments overseas 6.9. Some evidence on risk analysis in practice 6.10. Risk - the story so far 7 - Portfolio theory and its relevance to real investment decisions 7.1. The relevance of security prices 7.2. The expected value/variance [or mean/variance] criterion 7.3. Security investment and risk 7.4. Portfolio theory 7.5. The capital asset pricing model 7.6. CAPM: an example of beta estimation 7.7. Assumptions of CAPM 7.8. Tests of CAPM 7.9. CAPM - why the doubts? 7.10. Implications of modern portfolio theory and CAPM 7.11. Lack of shareholder unanimity on risky investment 7.12. Using CAPM to derive discounted rates for real investments - the practice problems 7.13. Arbitrage pricing model 7.14. Diversification within the business Part Three: Financing decisions 8 - Sources of long-term finance 8.1. Introduction 8.2. Ordinary [equity] capital 8.3.Methods of raising additional equity finance 8.4. Preference shares 8.5. Loan notes and debentures 8.6. Convertibles loan notes 8.7. Warrants 8.8. Term loans 8.9. Asset-based finance [securitisation] 8.10. Leasing 8.11. Grants from public funds 8.12. Islamic finance 8.13. Conclusions on long-term finance 9 - The secondary capital market [the stock exchange] and its efficiency 9.1. Introduction 9.2. The London stock exchange 9.3. Capital market efficiency 9.4. Test of capital market efficiency 9.5. The efficient market paradox 9.6. Conclusions on, and implications of, capital market efficiency 9.7. Behavioural finance 10 - Cost of capital estimations and the discount rate 10.1. Introduction 10.2. Cost of individual capital elements 10.3. Weighted average cost of capital [WACC] 10.4. The discounted rate - CAPM versus the traditional approach 10.5. WACC value used in practice 10.6. The use of WACC in practice 10.7. Further points on WACC 11 - Gearing, the cost of capital and shareholders' wealth 11.1. Introduction 11.2. Is debt finance as cheap as it seems? 11.3. Business risk and financial risk 11.4. The traditional view of gearing 11.5. The Modigliani and Miller view of gearing 11.6. Other thoughts on the tax advantage of debt financing 11.7.Captial/financial gearing and operating gearing 11.8. Other practical issues relating to capital gearing 11.9. Evidence on gearing 11.10. Gearing and the cost of capital - conclusion 11.11. The trade off theory 11.12. Pecking order theory 11.13. Likely determinants of capital gearing 11.14. MM, modern portfolio theory and CAPM 11.15. Weighted average cost of capital revisited 12 - The dividend decision 12.1. Introduction 12.2. Modigliani and Miller on dividends 12.3. The traditional view on dividends 12.4. Who is right about dividends? 12.5. Other factors 12.6. Dividends: the evidence 12.7. Conclusions on dividends 13 - Management of working capital 13.1. Introduction 13.2. The dynamics of working capital 13.3. The importance of the management of the working capital 13.4. Working capital and liquidity 13.5. Overtrading 13.6. Inventories [stock in trade] 13.7. Just-in-time inventories management 13.8. Trade receivables [trade debtors or accounts receivable] 13.9. Cash [including overdrafts and short-term deposits] 13.10. Trade payables 13.11. Working capital levels in practice 14 - Corporate restructuring [including takeovers and divestments] 14.1 Introduction 14.2. Takeovers and mergers 14.3. Mergers: the practicalities 14.4. Divestments 15 - International aspects of business finance 15.1. Introduction 15.2. Foreign exchange 15.3. Problems of internationalisation 15.4. International investment appraisal 15.5. Risks of internationalisation, management of those risks and portfolio theory 16 - Small businesses 16.1. Introduction 16.2. Corporate objectives 16.3. Organisation of small businesses 16.4. Taxation of small businesses 16.5. Investment decisions 16.6. Risk and the discount rate 16.7. Sources of finance 16.8. Valuation of small businesses 16.9. Gearing 16.10. Dividends 16.11. Working capital and small businesses