Intermediate Financial Management, 9th ed.

Abstract

Much has happened in finance recently. Years ago, when the body of knowledge was smaller, the fundamental principles could be covered in a one-term lecture course and then reinforced in a subsequent case course. This approach is no longer feasible. There is simply too much material to cover in one lecture course. As the body of knowledge expanded, we and other instructors experienced increasing difficulties. Eventually, we reached these conclusions: (1) The introductory course should be designed for all business students, not just for finance majors, and it should provide a broad overview of finance. Therefore, a text designed for the first course should cover key concepts but avoid confusing students by going beyond basic principles. (2) Finance majors need a second course that provides not only greater depth on the core issues of valuation, capital budgeting, capital structure, cost of capital, and working capital management but also covers such special topics as mergers, multinational finance, leasing, risk management, and bankruptcy. (3) This second course should also utilize cases that show how finance theory is used in practice to help make better financial decisions. When we began teaching under the two-course structure, we tried two types of existing books, but neither worked well. First, there were books that emphasized theory, but they were unsatisfactory because students had difficulty seeing the usefulness of the theory and consequently were not motivated to learn it. Moreover, these books were of limited value in helping students deal with cases. Second, there were books designed primarily for the introductory MBA course that contained the required material, but they also contained too much introductory material. We eventually concluded that a new text was needed, one designed specifically for the second financial management course, and that led to the creation of Intermediate Financial Management, or IFM for short.