Reference no: EM131085419

Making Long Term FM Decisions - Integrative Case      

Title: Analyzing Long Term Financial Decision Making in the Firm (Learning Demonstration 3)

Initial Steps to Completion:

1. Organize your team, choose a leader, and accept accountability for being the lead analyst for one or more parts of this list of tasks.

2. Complete your draft assigned task(s) and post in a common area for review by your team members.

3. Review, comment on, and suggest changes to draft completed tasks by the team.

4. Discuss and resolve differences and come to a consensus on the best responses.

5. Organize your analysis, conclusions, and recommendations

Course Deliverable: Write a report responding to the tasks assigned to your team. Clearly organize your report and effectively communicate the team's analysis, conclusions and recommendations (if appropriate) associated with each task. Provide the details supporting your analysis as attachments. You should be completing tasks along the way - do not wait until the end of the course to complete your tasks.

Introduction: As a special analytical group set up by ACME Iron by the firm's Controller, you have been tasked to respond to the following issues raised in a meeting with the CFO. You and your team must look over several prospective financial strategies to aid in the successful growth of ACME Iron.

You are to work over an 10 week period on several projects, detail your work as you proceed on these projects, and assemble the report for the CFO to make to the board on the items listed while you work in a team environment. Management will be looking at the team over this period on how well they self-organize and analyze the research areas which will include:

• Capital investment analysis
• CAPM - Capital Asset Pricing Model determination for the company
• WACC - Weighted Average Cost of Capital computations
• EVA - Economic Value Analysis
• MVA - Market Value Added
• Capital structure of the company
• Dividend policy
• Stock repurchase and option pricing strategy
• Bankruptcy risk analysis
• Decision Tree Creation
• Real option analysis of projects

The CFO wants to test your team out on a simple project in the first task before you get into preparing items for his board presentation in subsequent tasks and projects. He wants to see how well you perform tasks as a team as well as how accurate and thoughtful you are in your work. Details are important to him as well as good organization/presentation and communication.