AF5043 - Decision Making in the Financial Environment

What will I learn on this module?

You will learn how different types of financial decisions are made in the business environment. You will cover three main areas; how financial statements are used in financial decision making; how managers can use cost and revenue information to make short terms decisions; and strategic investment decision making based on investment appraisal techniques. Specific topic areas will include:


Financial statements for decision making:
The reporting frameworks and ethical principles that underpin financial reporting and the importance of international reporting standards
The informational content of financial statements using ratio analysis – an introduction to fundamental analysis.

Short term decision making:
The nature of cost behaviour and an introduction to Cost, volume, profit analysis
Relevant costs for decision making
Budgeting and control (including the use of big data and AI)
Dealing with risk and uncertainty

Strategic decision making
Investment appraisal techniques (payback, accounting rate of return, net present value and internal rate of return) including how to treat taxation and inflation
Practical aspects of investment appraisal (capital rationing, repeated investment decisions and lease v buy decisions)
Managing investment in working capital
Introduction to cost of capital.

The indicative schedule will be
1. Introduction to the module – decision making in the financial environment (to include introduction to financial statements)
2. Using financial statements to make decisions
3. Short term decision making – The nature of cost behaviour and introduction to CVP
4. Short term decision making – Relevant costing
5. Short term decision making – Budgeting and control (Big data, AI)
6. Short term decision making – Risk and Uncertainty
7. Strategic decision making – Investment appraisal – basic techniques
8. Strategic decision making – Investment appraisal incorporation of taxation and inflation
9. Strategic decision making – Specific investment decisions including how to treat risk and uncertainty.
10. Strategic decision making – Managing investment in working capital
11. Strategic decision making – Introduction to the cost of capital
12. Review of module

How will I learn on this module?

You will learn by means of lectures (24 hours) and seminars (12 hours), supported by tutor-directed study (82 hours) and independent learning (82 hours). These will introduce you to different types of financial decisions and will demonstrate, through use of worked examples, how this information can be used to make decisions. You will then be required to apply these methods by undertaking exercises in advance of your seminar. Your tutor will work through these with you in the seminar session and discuss how these techniques can aid decision making, whilst introducing critical reflection on the techniques you cover. This will provide you with a means of formative assessment and feedback, by enabling you to determine your level of knowledge and understanding of a topic and ability to apply the techniques you have learnt.

How will I be supported academically on this module?

You will be supported by a teaching and learning plan (TLP) that outlines the pattern and content of formal sessions, tutor-directed study, and independent study. Support in relation to the day-to-day operation of the module will be provided by the module tutor in the first instance. You will also receive feedback from tutors in seminars, facilitated by the formative assessment activities, during which you will have an opportunity to ask any questions you may have in respect of the subject matter. You will have access to an electronic reading list will provide you with information in respect of the supporting texts. Your lectures will be recorded and uploaded to the e-learning portal which you will be able to access to consolidate your knowledge and develop understanding.

What will I be expected to read on this module?

All modules at Northumbria include a range of reading materials that students are expected to engage with. The reading list for this module can be found at: http://readinglists.northumbria.ac.uk
(Reading List service online guide for academic staff this containing contact details for the Reading List team – http://library.northumbria.ac.uk/readinglists)

What will I be expected to achieve?

Knowledge & Understanding (KU):
• Use financial analysis to interpret financial information and make decisions (MLO1)

• Apply short term decision making techniques to make operational financial decisions (MLO2)

• Apply long term decision making techniques to make strategic financial decisions (MLO3).

Intellectual / Professional skills & abilities (IPSA):

• Make recommendations to stakeholders resulting from analysis of financial statements (MLO4).


Personal Values Attributes (PVA):

How will I be assessed?

The module will be assessed by a 2 hour open notes examination which will comprise short answer and long form questions (candidates will be advised on permissible materials).

This will assess MLOs 1 – 4

Pre-requisite(s)

Appropriate to level 4 study

Co-requisite(s)

N/A

Module abstract

Decision Making in the financial environment will provide you with the knowledge and numerical and problem-solving skills that will greatly enhance your employability within any business environment. You will be able to assess the performance of businesses with regard to profitability, solvency, financial structure and working capital management by means of analysing and interpreting their financial statements. You will also be able to make decisions in relation to both short and long term decisions as well as how to use budgets for planning and control purposes. You will also be able to deal with risk and uncertainty in a decision making situation.

Course info

UCAS Code N1NJ

Credits 20

Level of Study Undergraduate

Mode of Study 2 years full-time or 3 year sandwich

Location City Campus, Northumbria University

City Newcastle

Start September 2023

Fee Information

Module Information

All information is accurate at the time of sharing.

Full time Courses starting in 2023 are primarily delivered via on-campus face to face learning but may include elements of online learning. We continue to monitor government and local authority guidance in relation to Covid-19 and we are ready and able to flex accordingly to ensure the health and safety of our students and staff.

Contact time is subject to increase or decrease in line with additional restrictions imposed by the government or the University in the interest of maintaining the health and safety and wellbeing of students, staff, and visitors, potentially to a full online offer, should further restrictions be deemed necessary in future. Our online activity will be delivered through Blackboard Ultra, enabling collaboration, connection and engagement with materials and people.

 

Current, Relevant and Inspiring

We continuously review and improve course content in consultation with our students and employers. To make sure we can inform you of any changes to your course register for updates on the course page.


Your Learning Experience

Find out about our distinctive approach at 
www.northumbria.ac.uk/exp

Admissions Terms and Conditions
northumbria.ac.uk/terms

Fees and Funding
northumbria.ac.uk/fees

Admissions Policy
northumbria.ac.uk/adpolicy

Admissions Complaints Policy
northumbria.ac.uk/complaints