Financial management is widely used in introductory and intermediate corporate finance courses. This edition offers an increased focus on questions and solutions.

Financial management is widely used in introductory and intermediate corporate finance courses. This edition offers an increased focus on questions and solutions. A greater number of questions have been inserted at the introductory and intermediate levels and the financial management link on the website www.jutaacademic.co.za will offer additional questions and solutions. Recent examination questions from the Part 1 and Part 11 of the Qualifying examination have been included, as well as questions from the professional examinations set by ACCA and CIMA. Real-world applications of corporate finance theory and new developments are included to ensure that the textbook retains its relevance.

• Overview of financial management - overview of the forces shaping the south african economy, forms of business organization - inclusion of a comprehensive table, introduction to economic value added (eva) and reference to enron, greater focus on the objective of financial management, expansion of the section on agency theory, expansion of the section on the fundamental concepts in finance
• time value of money - increased use of graphs to depict compounding and discounting, new section and example on growing perpetuities, which links up with the dividend growth model in the valuations chapter, new section and example of growing annuities, new section on continuous compounding, greater use of real world examples relating to retirement planning and the affect of lower future equity returns and longer life spans on pension contributions, new section on loan amortization schedules, new section on how to use financial calculators to solve tvm problems, new section on how to use excel to solve tvm problems, a greater number of self-study examples to determine the repayments on a car loan and a mortgage loan, the valuation of zero coupon bonds, and the value the transfer of David Beckham to real madrid
• risk and return - reference to the operating leverage and financial leverage of selected South African companies, new section on historical returns from investing in ordinary shares and bonds in South Africa, new section on measuring the standard deviations of returns from investing in ordinary shares and bonds, use of excel to determine standard deviations
• portfolio management - updated section on betas for JSE sectors and for selected South African companies, new section on estimating betas in South Africa, use of excel to determine portfolio returns and standard deviations, use of excel to explain the concept of efficient frontiers, expansion of the section on market efficiency, section on what warren buffett thinks about diversification, contribution by Prof. Dave Bradfield on beta estimation.