As a follow-up to “Book Reviews 2,” I am posting herein an abridged version of a paper that I once wrote for a PhD course in Curriculum Engineering. I hope that my readers will enjoy it as well, or at least benefit from it.
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A COMPARATIVE ASSESSMENT OF GRADUATE EDUCATION IN FINANCIAL MANAGEMENT IN SELECTED LEADING BUSINESS SCHOOLS IN THE PHILIPPINES AND THE USA
By Francisco C. de la Cruz Jr.
April 27, 2011
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Outline of Topics
(“Table of Contents” in Original Paper)
1. Executive Summary
2. Research Procedure
3. Old Syllabi
3.1. Managerial Accounting
3.2. Financial Management
4. New Syllabi
4.1. Managerial Accounting
4.2. Financial Management
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EXECUTIVE SUMMARY
I undertook this research for the benefit of my Master in Management, Master in Business Administration, and Master in Educational Leadership and Management students, i.e., former, current, and future students. (Come to think of it, it is for the benefit of my future DBA and PhD students as well.) The Finance Curriculum discussed herein entail two courses that are normally taken consecutively in a typical graduate management program: Managerial Accounting and Financial Management. The time-frame is the trimestral system.
Simply put, I studied the Finance curricula of some of the best business schools in the Philippines and in the United States, and then I revised the syllabi I have normally used for the MBA-Finance Curriculum I have often taught, in an attempt to make it at par with the best. I employed the techniques of vertical integration, horizontal integration, and benchmarking.
Apart from the revised syllabi as aforementioned, another outcome of this paper is the finding that there are certain Finance topics that consistently qualify as core Finance topics among the best business schools. On the other hand, there are also certain finance topics that MBA students often hope to learn from a typical MBA program, but which are actually normally considered by MBA professors as non-core special topics and are therefore usually only taught in elective courses. This knowledge can be of significant help and comfort to any Finance professor, because it enables him to reconcile his understanding of what he should teach vis-à-vis what his students expect to learn in a typical MBA Finance course. Finance is a vast universe, and MBA students being the adult students that they are can be very demanding and capricious, thus standard parameters are a Finance professor’s best friend.
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PROCEDURE
I worked on the revision by undertaking the following:
Vertical Integration
I reviewed the syllabi which I originally designed and currently use in teaching Managerial Accounting and Financial Management (presented here below) and redesigned them to ensure the clear relationship and upward continuity between the two courses.
Horizontal Integration
I emphasized the relationship of Financial Management with the other functions of management, namely: General Management, Operations Management, Marketing Research and Management, Human Resources Management, and Information Technology Management. I did this by making a Corporate Strategy for a Business Organization with Competitive Financial Analysis as the Primary Basis as the chief requirement for both courses. A corporate strategy for an existing business is required for Managerial Accounting, while a corporate strategy for a new business is required for Financial Management. They are discussed in the syllabi for both courses at Week 1.
The basic framework for the said Corporate Strategy is as follows:
Framework of Business and Educational
Leadership and Management
General Management
· Leadership and Management
· Vision and Mission
· Setting of Objectives and Goals
· Formulation of Strategy and Specific Tactics
| ||
Operations
· Manufacturing or Trading Activities
· Equipment and Plant Maintenance
In the Case of Educational Institutions
· Curriculum Design
· Teaching
· Research
· Cultural and Historical Preservation
· Academic Services
· Outreach Programs
|
Finance
· Investment Management
· Budget Management
· Cashflow Management (Collections and Disbursements)
· Payroll and Benefits Administration
· Record Keeping
· Financial Reports Preparation and Analysis
· Ad Hoc Financial and Business Analysis
|
Marketing
· Marketing Research
· Promotion and Advertising
· Client Development and Customer Service
In the Case of Educational Institutions
· Alumni Relations
· External Relations – Local
· External Relations – International
· Events Management and Promotions
|
Information and Communications Technology
· Computer Software and Hardware
· System Analysis and Design
| ||
Human Resources Management
· Organizational Development
· Culture Development
· Hiring Policies and Systems
· Performance Evaluation and Reward System
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Benchmarking
This is the most important step in the process, albeit actually very simple and basic. I simply studied the Finance curriculum of the MBA, DBA, and similar programs of some of the best business schools in the Philippines and the United States, as listed here below. The curricula were available for viewing in the websites of the pertinent business schools. I then selected the best features or best practices in these curricula and used them as basis for revising the Old Syllabi in order to produce the New Syllabi.
The Finance Curricula I studied were as follows:
· Finance Curriculum of the Master of Business Administration Program of Harvard University
· Finance Curriculum of the Master of Business Administration Program of Yale University
· Finance Curriculum of the Master of Business Management Program and the Master in Management Program of the Asian Institute of Management
· Finance Curriculum of the Master of Business Administration Program of De La Salle University
· Finance Curriculum of the Master of Business Administration Program of the University of the Philippines
· Finance Curriculum of the Doctor of Business Administration Program of Harvard University
· Finance Curriculum of the Doctor of Business Administration Program of De La Salle University
· Pertinent Courses in the Master of Science in Computational Finance Program of De La Salle University
· Pertinent Courses in the Master of Science in Accountancy Program of De La Salle University
· Chartered Financial Analyst Program of the Association for Investment Management Research
· Asiaweek Interactive Edition – Research Survey on The Best MBA Programs in Asia
Note: The website containing information on the MBA Program of Ateneo de Manila University could not be accessed as of this writing.
Other Important References:
- Earlier feedback from my current or former MBA-Finance students.
- “W. SyCip Graduate School of Business of the Asian Institute of Management – Reinvented and Reinvigorated to Face Global Competition.” Main feature article in The Asian Manager (an AIM publication). Second semester 2001-2002.
Outcomes and Findings
The basic outcomes of this research are of course the new syllabi found on the last few pages herein. Meanwhile, the basic findings are as follows:
· The Finance Curriculum of selected leading business schools in the Philippines and the United States normally included certain core topics. Pertinently, I incorporated these core topics in the MBA Finance curriculum which I will be teaching in the future – precisely by way of the new syllabi on the last few pages of here below – to ensure that the said curriculum is at par with the best. Specifically, the core topics are incorporated as follows:
1. All throughout the new syllabus for Managerial Accounting
2. From Weeks 1 to 7 of the new syllabus for Financial Management
· Meanwhile, there are certain topics that are normally not in the core curriculum for Finance of the selected leading business schools, but are normally expected to be included in the core Finance curriculum by MBA students. One such topic is “how to play the stock market.” I form this opinion based on my experience with my AIM classmates, as well as my former MBA Students from DLSU, UST, UA&P and SBC.
However, instead of including these topics in their core Finance curriculum, the selected leading business schools deliver these topics by way of advanced elective courses. To therefore satisfy the interest of MBA students in these topics to at least some extent, I have included some of these topics in Weeks 8, 9, 10, and 11 of the new syllabus for Financial Management even if only at the introductory level.
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ORIGINAL SYLLABUS
(Course Contents Only)
Managerial Accounting
14 Weeks (One Trimester)
- Course Orientation// Lesson: The Single-Entry Bookkeeping System, The Double-Entry Bookkeeping System, The Balance Sheet, The Income Statement.// Discussion of Major Course Requirement: A Corporate Strategy for an Existing Business with Emphasis on Financial Analyses
- The Balance Sheet, The Income Statement, Cashflow Management, Basic Taxation
- Financial Ratios, Budget Planning & Performance Analysis, Strategic Cost Cutting
- First Filter Exam
- Job Order Cost System, Process Cost System
- Cost Behavior and Cost-Volume-Profit Analysis
- Budgeting
- Performance Evaluation for Decentralized Operations, Differential Analysis and Product Pricing
- Second Filter Exam
- Capital Budgeting – Time Value of Money: Simple and Compounded Interest, Future and Present Values.// Capital Budgeting – Basic Formulas, Net Present Value, Payback Period, Internal Rate of Return, Return on Investment
- General Review for Final Exams
- Written Final Exams
- Final Group Presentation and Defense – Group 1 & 2: A Corporate Strategy for an Existing Business with Emphasis on Financial Analyses.
- Final Group Presentation and Defense – Group 3 & 4: A Corporate Strategy for an Existing Business with Emphasis on Financial Analyses.
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ORIGINAL SYLLABUS
(Course Contents Only)
Financial Management
14 Weeks (One Trimester)
- Course Orientation.// Discussion of Major Course Requirement: A Corporate Strategy for an Existing Business with Emphasis on Competitive or Industry Financial Analyses
- Capital Budgeting – Time Value of Money: Simple and Compounded Interest, Future and Present Values
- Capital Budgeting – Time Value of Money: Simple and Compounded Interest, Future and Present Values
- Capital Budgeting – Basic Formulas: Net Present Value, Payback Period
- Capital Budgeting – Basic Formulas: Net Present Value, Payback Period
- Capital Budgeting – Basic Formulas: Internal Rate of Return, Return on Investment
- Capital Budgeting – Basic Formulas: (More on) Internal Rate of Return
- Mid-Term Exams
- Preliminary Group Presentation and Defense: A Corporate Strategy for an Existing Business with Emphasis on Competitive or Industry Financial Analyses
- Review of Managerial Accounting and Financial Management and/or Additional Topics in Corporate Finance
- Review of Managerial Accounting and Financial Management and/or Additional Topics in Corporate Finance
- Written Final Exams
- Final Group Presentation and Defense Group 1 & 2: A Corporate Strategy for an Existing Business with Emphasis on Competitive or Industry Financial Analyses
- Final Group Presentation and Defense Group 3 & 4: A Corporate Strategy for an Existing Business with Emphasis on Competitive or Industry Financial Analyses
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NEW SYLLABUS
(Complete Syllabus)
XYZ Graduate School of Business
Master in Business Administration Program
Syllabus
Course : Managerial Accounting
Schedule : Saturday/ n:00 – n:00 am/ January ? to April ? 2011
Course Credit : 3
Course Description – The course is designed to:
· Provide a generalist and basic understanding of Financial and Management Accounting.
· Relate Financial and Management Accounting to all the other functions of Management, namely: General Management, Operations, Marketing, Human Resources, and Information Technology.
Course Objectives – The course will train students to:
· Analyze and interpret Accounting information for decision making purposes.
· Apply various financial analytical tool and techniques in identifying and solving practical business problems.
Methodology and Approach
· Students will be encouraged to explore and speak up, and should not be afraid to ask “silly” questions. The course is intimidating enough as it is.
· The already-trained Accounting & Finance professionals in class will be trained further in terms of communicating Accounting & Financial information to non-Accounting/Finance colleagues.
· A great deal of reading and exercises will be required. Teamwork will also be strongly encouraged.
Week 1
Course Orientation
Diagnostics Test and Class Profiling
Discussion of Major Course Requirement: Group Thesis – “A Corporate Strategy for an Existing Business Organization with Competitive Financial Analysis as Primary Basis”.
Ø This is an Integrative Exercise in Finance vis-à-vis General Management, Operations, Marketing, Human Resource Management, and Information Technology
Discussion of Corporate Strategy Framework
Week 2
Class to be divided into three or four groups for the Corporate Strategy.
Financial vis-a-vis Managerial Accounting
The Accounting and Audit Professions
Ethical and Professional Standards
The Single-Entry Bookkeeping System
The Double-Entry Bookkeeping System
The Books of Accounts
The “T” Accounts
Debit and Credit
Basic Accounts
Week 3
The Balance Sheet
Assets, Liabilities, Owners’ Equity
Submission of Profile of Company for Corporate Strategy, and of Outline of Corporate Strategy
Week 4
The Income Statement
Definition and Classification of Expenditures
Operating Revenue & Expenses vis-a-vis Other Revenue & Expenses
Classification of Operating Expenses
Fixed and Variable Costs
Income Statement for Manufacturing Concern
Basic Taxation
Week 5
Financial Ratios
- Current Ratio
- Working Capital Ratio
- Accounts Receivable Turn-over
- Inventory Turn-over
- Other Ratios
Week 6
Workshop - Decision Aid Softwares
Microsoft Excel (with emphasis on advanced formulas, e.g., Regression Analysis)
Cash Flow Management – To be demonstrated in the computer laboratory.
Corporate Cash Flow Management
Scenario Forecasting and Sensitivity Analysis
Bonus Topic: Individual/Personal Cash Flow Management
Week 7
Budget Planning and Performance Analysis
Comparative Analyses: Vertical, Horizontal, Trend
Variance Analysis
Strategic Cost Cutting: Specific Action Plan Matrix
Week 8
Mid-Term Exams
Week 9
Responsibility Accounting
Profit and Cost Centers
Contribution Margin Analysis
Break-Even Analysis
Week 10
Supplemental Topics
* Primer – Internal Audit, External Audit, and Internal Control
* Primer – Job Order Cost System vis-a-vis Process Cost System
* Primer – Activity Based Costing
* Primer – Economic Value Added Analysis
Week 11
Preliminary Presentation and Defense of Corporate Strategies
Submission of names and credentials of external panelists for CorpStrat Defense
Week 12
Written Final Exams
Week 13
Presentation and Defense of Corporate Strategies by Groups 1 & 2
Week 14
Presentation and Defense of Corporate Strategies by Groups 3 & 4
Course Requirements and Grading System:
· Written Exercises, Quizzes, Oral Recitation, Academic Participation in Group Website
· Coursework Portfolio
· Midterm Exam
· Final Exam
· Group Thesis
Textbook:
· Financial and Managerial Accounting (The Basis for Business Decisions), Twelfth Edition (International Edition), by Williams, Haka, Bettner, and Meigs. McGraw Hill Publication.
References:
· Group Thesis on Corporate Strategies by prior MBA-Finance batches.
· Financial and Managerial Accounting by Carl S. Warren
· Intermediate Accounting, by Smith, Skousen, and Kimwell, latest Philippine printed edition
· Financial Accounting by Meigs & Meigs
· Managerial Accounting by Ronald W. Hilton
· Cost Accounting, A Managerial Emphasis by Charles Horngren, Latest Edition
· Accounting Text and Cases by Robert N. Anthony and James S. Reece, Latest Edition
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NEW SYLLABUS
(Complete Syllabus)
XYZ Graduate School of Business
Master in Business Administration Program
Syllabus
Course : Financial Management
Schedule : Saturday/ n:00 – n:00 am/ January ? to April ? 2011
Course Credit : 3
Prerequisite : Managerial Accounting
Course Description – The course is designed to:
· Provide a generalist and basic understanding of Financial Management.
· Relate Financial Management to all the other functions of Management, namely: General Management, Operations, Marketing, Human Resources, and Information Technology.
Course Objectives – The course will train students to:
· Analyze and interpret Financial information for decision making purposes.
· Apply various financial analytical tool and techniques in identifying and solving practical business problems.
Methodology and Approach
· Students will be encouraged to explore and speak up, and should not be afraid to ask “silly” questions. The course is intimidating enough as it is.
· The already-trained Accounting & Finance professionals in class will be trained further in terms of communicating Accounting & Financial information to non-Accounting/Finance colleagues.
· A great deal of reading and exercises will be required. Teamwork will also be strongly encouraged.
Week 1
Course Orientation
Diagnostics Test and Class Profiling
Discussion of Major Course Requirement: Group Thesis – “A Corporate Strategy for a New Business with Emphasis on Financial Analyses.”
Ø This is an Integrative Exercise in Finance vis-à-vis General Management, Operations, Marketing, Human Resource Management, and Information Technology
Ø Note: Financial Analysis includes - Projected Financial Statements, Cash Flow Management, Budget Planning using Comparative Analyses, Financial Ratios, Break-Even Analysis, and Capital Budgeting. Additional tools: Specific Action Plan Matrix, and Gantt Chart.
Week 2
Review of Managerial Accounting
The Role of the Finance Manager
The Role of the Chief Finance Officer
Ethical and Professional Standards
MBA Career Opportunities: Corporate Practice, Entrepreneurship, Management Consultancy, Business Academia, etc.
Class to be divided into three or four groups for the Corporate Strategy.
Week 3
Time-Value of Money
Simple and Compounded Interest
Future and Present Values
Submission of Profile of Company for Corporate Strategy, and of Outline of Corporate Strategy
Week 4
Capital Budgeting
Definition of Cash Flow After Taxes or Savings After Taxes
Net Present Value
Payback Period: Simple and Discounted
Week 5
Capital Budgeting
Net Present Value
Payback Period: Simple and Discounted
Internal Rate of Return
Interpolation
Week 6
Capital Budgeting
Internal Rate of Return
Interpolation
Week 7
Mid-terms
Week 8
Lease vis-a-vis Purchase Analysis
Advanced Finance Topics:
* Primer – International Finance: Foreign Exchange Management, Multinational Accounting
* Primer – Management of Financial Institutions: Commercial Banking, Investment Banking
Week 9
Advanced Finance Topics:
* Primer – Analysis of Equity Investments: Fundamental and Technical Analysis
* Primer – Analysis of Fixed-Income Investments
Week 10
Advanced Finance Topics:
* Primer – Derivatives: Forward, Futures, Options, Swaps
* Primer – Analysis of Alternative Investments: Real Estate, Investment Companies, Venture Capital, Hedge Funds, Commodity Markets and Commodity Derivatives
* Primer – Portfolio Management: Capital Market Theory, Portfolio Construction, Equity Portfolio Management Strategies, Fixed-Income Portfolio Management Strategies, Risk Management, Performance Measurement
Week 11
Preliminary Presentation and Defense of Corporate Strategies
Submission of names and credentials of external panelists for CorpStrat Defense
Week 12
Written Final Exams
Week 13
Presentation and Defense of Corporate Strategies by Groups 1 & 2
Week 14
Presentation and Defense of Corporate Strategies by Groups 3 & 4
Course Requirements and Grading System:
· Written Exercises, Quizzes, Oral Recitation, Academic Participation in Group Website
· Coursework Portfolio
· Midterm Exam
· Final Exam
· Group Thesis
Textbook:
· Principles of Corporate Finance, by Richard Brealey and Stewart Myers, latest Philippine printed edition
References:
· Group Thesis on Corporate Strategies by prior MBA-Finance batches.
· Financial Management in the Philippine Setting, Texts and Cases, by Cesar G. Saldana
· Investment Analysis and Portfolio Management by Frank Reilly
· Textbook and reference books for Managerial Accounting
