Certified Financial Consultant (CFC®) Curriculum

Topic 1: Choosing the Right Corporate Objective

  • First Principles of Corporate Finance
  • Primer on Financial Statement Analysis
  • Traditional Balance Sheet
  • Financial View of the Firm

Topic 2: Evaluating Corporate Governance Profile

  • Objectives in Decision Making
  • Stockholder Interest vs Management Interest
  • Stockholder Objectives vs Bondholder Objectives
  • Firm and Financial Markets
  • Firms and Society
  • Alternative Corporate Governance System

Topic 3: Understanding Concept of Risk

  • Motivation and Perspective in Analyzing Risk
  • Equity Risk and Expected Returns
  • The Capital Asset Pricing Model
  • The Risk in Borrowing: Default Risk and the Cost of Debt

Topic 4: Developing Risk Profile

  • Measuring Risk Parameters
  • Measuring Operating Leverage
  • Estimating Cost of Equity
  • From Cost of Equity to Cost of Capital

Topic 5: Picking the Right Projects

  • Primer on Time Value of Money
  • What is a Project?
  • Accounting Earnings vs Cashflows
  • Hurdle Rates for Firms vs Hurdle Rates for Projects
  • Investment Decision Rules: NPV vs IRR
  • Where do Good Projects Come from?

Topic 6: Analyzing Project Side Costs and Benefits

  • Mutually Exclusive Projects
  • Capital Rationing
  • Side Costs and Benefits
  • Project Synergy
  • Valuing the Option to Delay
  • Valuing the Option to Abandon

Topic 7: Finding the Right Financing Mix

  • Financing Choices
  • Benefits of Debt
  • Cost of Debt
  • Rationale for Financing Hierarchy

Topic 8: Determining Optimal Financing Mix – Approaches and Alternatives

  • The Cost of Capital Approach
  • The Adjusted Present Value Approach
  • The Comparative Analysis Approach

Topic 9: Returning Cash to the Owners

  • Steps to Dividend Decision
  • Measures of Dividend Policy
  • Three Schools of Thoughts on Dividends
  • Wrong Reasons for Paying Dividends

Topic 10: Analyzing Cash Returned to Stockholders

  • Practical Framework for Analyzing Dividend Policy
  • Dividend Matrix

Topic 11: Practicing Valuation Principles

  • Discounted Cashflow Valuation
  • Estimating Cost of Equity
  • Estimating Cashflows
  • Estimating Expected Growth
  • ROE and Leverage
  • Relative Valuation

Topic 12: Valuing Companies for Acquisition and Takeovers

  • Steps involved in Acquisition Valuation
  • Value of Control
  • Procedures for Valuing Synergy
  • Valuing Tax Benefits
  • Valuing Debt Capacity