STFM - Introduction to Special Topics in Financial Management (PDF)

SPECIAL TOPICS IN FINANCIAL MANAGEMENT INTRODUCTION TO SPECIAL TOPICS IN FINANCIAL MANAGEMENT Second Semester, AY 2024-2025 LEARNING OBJECTIVES: 1. Understand the scope and significance of special topics in financial management. 2. Recognize the evolving role of fi...

SPECIAL TOPICS IN FINANCIAL MANAGEMENT INTRODUCTION TO SPECIAL TOPICS IN FINANCIAL MANAGEMENT Second Semester, AY 2024-2025 LEARNING OBJECTIVES: 1. Understand the scope and significance of special topics in financial management. 2. Recognize the evolving role of financial managers in a dynamic business environment. 3. Review fundamental financial concepts and their application to contemporary issues.  BRAIN TEASER A. Warren Buffet 1. Co-founder of Tesla 2. Former Governor of the Bangko B. Elon Musk Sentral ng Pilipinas (BSP), Former C. Christine Lagarde Finance Secretary D. Ramon S. Ang 3. CEO, JG Summit Holdings, Inc. 4. President of the European Central E. Lance Gokongwei Bank F. Benjamin Diokno 5. CEO, President, and Vice Chairman of San Miguel Corporation (SMC) 6. Chair and CEO of Berkshire Hathaway  THE EVOLVING ROLE OF FINANCIAL MANAGERS Traditional vs. Modern Financial Management TRADITIONAL ROLE MODERN ROLE Bookkeeping Strategic decision-making Budgeting Risk Management Financial Reporting Technology-Driven Finance Financial managers are no longer just accountants; they are business strategists who drive corporate growth and sustainability.  THE EVOLVING ROLE OF FINANCIAL MANAGERS Core Responsibilities of Today’s Financial Managers 1. Financial Planning & Strategy – Aligning financial goals with business objectives. 2. Investment Decisions – Capital budgeting, portfolio management, and asset allocation. 3. Risk Management – Identifying and mitigating financial risks. 4. Corporate Governance & Compliance – Ensuring adherence to financial regulations. 5. Technology Integration – Adopting FinTech, AI, and blockchain in financial operations.  THE EVOLVING ROLE OF FINANCIAL MANAGERS Famous Financial Managers Who Made an Impact  THE EVOLVING ROLE OF FINANCIAL MANAGERS Famous Financial Managers Who Made an Impact  THE EVOLVING ROLE OF FINANCIAL MANAGERS Famous Financial Managers Who Made an Impact  THE EVOLVING ROLE OF FINANCIAL MANAGERS Famous Financial Managers Who Made an Impact Ramon S. Ang CEO, President, and Vice Chairman of San Miguel Corporation (SMC) Led strategic acquisitions and corporate expansion into food and beverage, power, infrastructure, and real estate.  THE EVOLVING ROLE OF FINANCIAL MANAGERS Famous Financial Managers Who Made an Impact Lance Gokongwei CEO, JG Summit Holdings, Inc. Led the acquisition of various companies, expanding URC's presence in Southeast Asia and the South Pacific.  THE EVOLVING ROLE OF FINANCIAL MANAGERS Famous Financial Managers Who Made an Impact Benjamin Diokno Former Governor of the Bangko Sentral ng Pilipinas (BSP), Former Finance Secretary Global Central Banker of the Year 2022 His research and policy experience include public economics, including government structure, tax policies, public spending management, fiscal decentralization, national budget, and public debt.  REVIEW OF FUNDAMENTAL FINANCIAL CONCEPTS The Three Pillars of Financial Management Investment Decisions Financing Decisions Dividend Policy Where should How should How should funds be businesses raise profits be allocated for capital? (Debt vs. distributed to maximum returns? Equity) shareholders? Understanding these core principles helps financial managers make informed business decisions.  REVIEW OF FUNDAMENTAL FINANCIAL CONCEPTS Key Financial Concepts and Their Applications CONCEPT DEFINITION REAL-WORLD APPLICATION Time Value of Money today is worth more than in the Used in investment valuation and loan assessments. Money future. Seen in stock market investments and business Risk and Return Higher risks typically lead to higher returns. expansions. Financial Used by companies like SM Prime to expand Using borrowed funds to increase returns. Leverage operations. Capital Helps businesses decide on new factory setups or Process of evaluating investment projects. Budgeting product launches. Liquidity Ensuring the company has enough cash to Banks maintain liquidity ratios for stability. Management meet obligations.  CASE STUDY – JOLLIBEE’S FINANCIAL MANAGEMENT STRATEGY How Jollibee Expanded Financially: Strategic acquisitions (e.g., The Coffee Bean & Tea Leaf, Tim Ho Wan). Effective capital budgeting for international expansion. Strong liquidity management to sustain operations during crises. Key insight: Jollibee’s financial strategies helped it transform from a local fast-food chain into a global brand.  EMERGING TRENDS IN FINANCIAL MANAGEMENT Technology Integration - AI-driven financial analytics, blockchain, and digital banking. Sustainable Finance - ESG (Environmental, Social, and Governance) investing. Globalization & Risk Management - Managing currency fluctuations and international trade finance. Financial managers must stay adaptable and informed to lead businesses effectively. ASK ME A QUESTION OR TWO  BRAIN TEASER B. Elon Musk 1. Co-founder of Tesla 2. Former Governor of the Bangko F. Benjamin Diokno Sentral ng Pilipinas (BSP), Former E. Lance Gokongwei Finance Secretary C. Christine Lagarde 3. CEO, JG Summit Holdings, Inc. 4. President of the European Central D. Ramon S. Ang Bank A. Warren Buffet 5. CEO, President, and Vice Chairman of San Miguel Corporation (SMC) 6. Chair and CEO of Berkshire Hathaway THANK YOU! Sir Roque