Corporate Finance
School of International Trade & Economics
Professor Shao Xueyan
课程宗旨
创造财富 谋之有道 取之有术 管之有方
学习方法
学而不思则罔
思而不学则殆
选自《论语》
哈佛学生学习不是与未来就业相匹配的，他们 学的东西可能与他们将来所要做的工作完全不一样。 广泛的知识面、有专业技能、有一定的远见、有能 力在职业生涯中继续学习是哈佛对学生的培养目标。
◆ Making an outlay immediately vs. Yielding benefits in the distant future. ◆ A single large amount of outlay vs. A stream of smaller amount of cash inflows. ◆ It is difficult to withdraw from an investment. ◆ Time is vital to investment decision–making

Capital Structure

The mix of long term debt and equity financing.
Investment and Financing Decisions
The Investment Decision

Real Assets
The Financing Decision

Agency Problems
• Managers are agents for stockholders, but the managers may act in their own interests rather than maximizing value
Shareholders vs. Stakeholders
Goals of The Corporation
Shareholders want wealth maximization
Wealth maximization vs. profit maximization:

Pitfall: Profits from which period? Pitfall: Cutting dividends to increase cash Solutions
Compensation plans Board of Directors
Blockholders
1-27
Agency Problem Solutions

1-15
What is a Corporation?
Public Companies: Shares are available for purchase by any investors, have a broad base of shareholders and have professional boards and management. Private Corporations: Shares are not available for public, are owned by small groups of managers and investors. Limited Liability Companies (partnership): General partners & Limited partners
1-21

Goals of The Corporation
Shareholders desire wealth maximization
Shareholders’ Wealth Maximization
Ordinary Share Current Market Value
Expected Future Cash flows
大学能做的最重要的事是，学生从学校毕业50 年以后，学生还能顺应时代的发展变化而继续学习、 进取、改变，这将能造就社会的领导者。
—— 哈佛大学荣誉校长陆登庭教授
于北京首届中外大学校长论坛
参考书目 1. 《公司理财》（第五版，双语教材） 理查德.A.布雷利等著 中国人民大学出版社 ． 2.《公司理财》（第九版，双语教材） 斯蒂芬.A.罗斯 等著 机械工业出版社 3. 《财务报表分析》（技巧 . 策略) 戴欣苗编著 清华大学出版社 ． 4.《上市公司虚假会计报表识别技术》 刘姝威 经济科学出版社
1-14
What is a Corporation?
Corporation-A business organized as a separate legal entity owned by stockholders. Types of Corporations:
Public Corporations Private Corporations

Benefits of the Corporation
Limited liability Infinite lifespan Ease of raising capital
1-17
Drawbacks of the Corporation
Corporations face the problem of double taxation Improper corporate structures may lead to “Agency Problems”
Corporation S-Corporation Partnership
622,908
$479,673,700
2,584,427
Sole $2,808,013,079 Proprietorship
$149,121,474
Source: U.S. Census 2008 SUSB Annual Data
5.《现代公司理财》 姚益龙 中山大学出版社
6.《沃伦巴菲特的投资组合》 [美]罗伯特.哈格斯特朗 机械工业出版社 7.《百万富翁的智慧》[美]托马斯.J.斯坦利博士 中国大百利全书出版公司 8. 《公司理财》（第二版） 蒋 屏编著 清华大学出版社 2013年4月
McGraw-Hill/Irwin
This chapter introduces the corporation, its goals, and the roles of financial managers.
Size of Payroll (000s)
$1,068,232,095
Number of Firms in the 1,011,973 U.S. 1,292,081
Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.
Investment and Financing Decisions
To make corporate investment or financing decision Capital Budgeting Decision
The Ethics of Maximizing Value
Does value maximization justify unethical behavior?
Recent examples:

Enron

WorldCom
Bernard Madoff
1-24

Agency Problem
Do managers really maximize value?
Investment and Financing Decisions
Financing Decision
Raising money that the firm needs for its investments and operations. Determining the amount, maturity and type of funds raised in financial markets.
Investment and Financing Decisions
Capital investment affects the amount of future cash flows generated, the timing of those cash flows, and the variability or risk of those future cash flows and thus, the value or worth of the capital budgeting decisions.

Decision to invest in tangible or intangible assets.
…also called the Investment Decision
Investment and Financing Decisions
The nature of capital investment decisions

Financial Assets
1-12
Investment and Financing Decisions
Are the following capital budgeting or financing decisions?

Apple decides to spend $500 million to develop a new iPhone.
The manager No Partners No
Corporation
Shareholders Usually
Unlimited