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Level 7 Diploma in Accounting and Finance

Key Financial and Capital Structure Theories

AF704 · Strategic Financial Management — Week 2 of 16

CourseAF704
Week2 of 16
SemesterII
TutorOnline in the course chat

This week’s topics

Key Financial and Capital Structure Theories

  1. Modigliani-Miller theorems on capital structure
  2. Agency theory and stewardship
  3. Pecking order theory and trade-off theory
  4. Efficient Market Hypothesis (EMH)
  5. Capital structure (theories) - CIMA F3 lecture
  6. Corporate Governance and Agency Theory

What you will be able to do

  • 2.1 Evaluate key financial theories.

Activity

Start with this week’s 2 videos, then: Seminar, guided reading and a short written task: evaluate key financial theories.

Study materials

Videos

  • Capital structure (theories) - CIMA F3 lecture · YouTube · OpenTuition · 32 min · for registered students
  • Corporate Governance and Agency Theory · YouTube · Galton College · 20 min · for registered students
  • Capital Structure Theory Explained - Raghavendra Rau · YouTube · Gresham College · 64 min · for registered students
  • Session 19: Enhanced Cost of Capital Approach and Determinants of Optimal · YouTube · Aswath Damodaran · 84 min · for registered students

Further resources

  • How Do CFOs Make Capital Budgeting and Capital Structure Decisions? · PDF · Reading, article · for registered students
  • MIT 15.414 Financial Management, lecture notes: Financing Decisions (2) · PDF · Other, slides · for registered students
  • MIT 15.401 Finance Theory I, lecture notes: Efficient Markets · PDF · Other, slides · for registered students
Materials marked “for registered students” open in the student portal, which is set up as soon as you receive final acceptance.
Week 1Week 3
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Admitted students ask questions on this week’s page in the student portal: an AI assistant trained on the course answers first, and during the course’s timetabled classes Connect to your tutor brings your tutor into the chat, who may start a call if needed.

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Course plan
  • Week 1: Strategic Financial Environment and Resource Allocation
  • Week 2: Key Financial and Capital Structure Theories
  • Week 3: Strategic Implementation and Portfolio Management
  • Week 4: Stakeholder Analysis and Corporate Governance
  • Week 5: Business Expansion and Stakeholder Impact
  • Week 6: Risk, Return, and Capital Investment Appraisal
  • Week 7: Corporate and Business Valuation Techniques
  • Midterm: Midterm evaluation
  • Week 9: Organisational Culture in Strategic Formulation
  • Week 10: Change Management and Cultural Dynamics
  • Week 11: Financial Analysis and Performance Measurement Systems
  • Week 12: Applying Strategic Financial Management in practice: case s…
  • Week 13: Assignment workshop: research, planning and referencing
  • Week 14: Assignment workshop: drafting, feedback and improvement
  • Week 15: Review and coursework completion
  • Final: Final assessment and submission
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