Corporate finance is concerned with the issues a firm faces in managing its money -- how should it raise and manage capital, what investments should it make, and how much of its profits should be paid out to shareholders. Students learn the importance of the cash cycle (the time between the date inventory is paid for and the date the cash is collected from the sale of the inventory) and a strong understanding of both financial and management accounting, as well as well as essential finance definitions
Business performance refers to skills that enable you to quickly and effectively determine the profitability, financial stability and liquidity of a firm. These are done through simple ratios that students need to memorize and perform in exams. It's also important to have an understanding of financial risk -- which is determined by a company's overall financial decision-making.
With businesses becoming bigger and more powerful, and the increasing importance of globalization and entry routes to market, it's paramount to have a strong understanding of mergers and acquisitions. Students are likely to get an insight into what conditions prompt companies to merge, as well as the justifications and reasoning for a firm attempting to, as well as accepting a takeover. Business leaders need to know how, why, and when they should invest in another company.
It's important to understand how financial conditions outside of a business affect the business' internal financial situation. It provides the connection between economics and finance by demonstrating what decisions a firm should make under certain conditions. How can a firm capitalize on cheaper production rates overseas, and at what exchange rate should it reconsider investing money into the European market? An appreciation of market timing means a company can improve performance by adjusting its portfolio according to market predictions, such as switching sectors or between stocks and risk-free treasury bills.