INTERNATIONAL FINANCIAL MANAGEMENT

The international dimension of a business calls for adapting the basic principles of corporate finance to give due consideration to emerging opportunities and risks and thus adapt the processes and operations of the function.
First, it is necessary to understand the relevant financial environment, knowing the operations and interconnections between different local environments.
Second is to understand the dynamics of currency markets and the rules the mechanisms that change the price of one currency in terms of another currency over time.
Third, the previous two points need to be translated into emerging opportunities and risks for companies operating in an international context, and the differences there are between a multinational structure, one active in import-export and one with eminently domestic activities in a free market context.
Particular attention is therefore given to the recognition, measurement and management of exposure to foreign exchange risk and counterparty risk. Knowledge of the main tools available to mitigate this risk is combined with the ability to identify the best strategy for their use based on the company's specifics, on which the tolerability of the risk depends, as well as the skills and degree of risk aversion of the management that such risk is called upon to guard against.

To know the rules of the game to which companies are subject in an international free market context
Perceive the opportunities and risks associated with the choices of internationalisation of business
Know the impact of fluctuating exchange rates on business performance
Know the main existing financial instruments to help manage exchange rate risk
Know how to define a risk management strategy.

Knowledge of the basic principles of corporate finance: cash flow and value

The international monetary system and the "laws" governing its equilibrium
The management of cross-border cash flows: problems of forecasting and counterparty risk management
The management of multi-currency treasuries
International taxation and transfer pricing
The dimensions of foreign exchange risk: economic, translation and transaction exposure
Financial instruments for hedging foreign exchange risk: forward; futures and options
Foreign exchange risk management: policies and strategies

Cheol Eun, Bruce Resnick, International Financial Management, McGraw-Hill Education International Edition

Written examination with 10 multiple choice questions, an open question and a numerical exercise.
The multiple-choice questions aim to test the learning of basic concepts.
The open question tests the ability to systematise the notions learnt in class in order to tackle specific problems.
The exercise aims to test the ability to apply the analysis and management tools covered in the course in practice.

Weekly lectures interspersed with application exercises and business cases.

English

written