This course covers what you need to know for the corporate finance section of the CFA. We will start by going over Corporate governance which is generally covered on the CFA exam. We will also go through calculations related to capital budgeting since they are a popular area of questions for the CFA exam. WACC and cost of capital are another area test takers can expect to see questions on since investors need to understand and be able to apply cost of capital calculations, and so we’ll cover all this as well. We will also go over risk management which has become a key aspect of investing and working capital management since it is a major topic within corporate finance. Finally, we’ll finish up with some helpful tips and good test taking strategies for this area to help you pass the CFA exam.

Learning Objectives
  • Discover and describe principal–agent and other relationships in corporate governance and the conflicts that may arise in these relationships.
  • Identify and calculate and interpret net present value (NPV), internal rate of return (IRR), payback period, discounted payback period, and profitability index (PI) of a single capital project.
  • Identify and calculate and interpret the weighted average cost of capital (WACC) of a company.
  • Explore, define, calculate, and explain leverage, business risk, sales risk, operating risk, and financial risk and classify a risk.
  • Recognize and evaluate working capital effectiveness of a company based on its operating and cash conversion cycles and compare the company’s effectiveness with that of peer companies.
  • Identify and understand test taking strategies for Corporate Finance problems.
Last updated/reviewed: August 15, 2023

Included In Certifications

This course is included in the following Certification Programs:

11 CoursesCFA Level 1 Preparation Certification Program

  1. CFA Level 1 Prep: Introduction to the CFA Exam
  2. CFA Level 1 Prep: 1 - Ethics and Professional Standards
  3. CFA Level 1 Prep: 2 - Quantitative Methods
  4. CFA Level 1 Prep: 3 - Economics
  5. CFA Level 1 Prep: 4 - Financial Reporting and Analysis
  6. CFA Level 1 Prep: 5 - Corporate Finance
  7. CFA Level 1 Prep: 6 - Equities Markets
  8. CFA Level 1 Prep: 7 - Fixed Income
  9. CFA Level 1 Prep: 8 - Derivatives
  10. CFA Level 1 Prep: 9 - Alternative Investments
  11. CFA Level 1 Prep: 10 - Portfolio Management
3 Reviews (18 ratings)

Reviews

4
Anonymous Author
Easy enough to understand. Author spoke at an appropriate rate and did a nice job of making the subject matter understood.
4
Member's Profile
It would be helpful to go through more examples of the calculations.
5
Member's Profile
Very good presenter. His additional commentary is helpful.
Prerequisites
Course Complexity: Intermediate

No advanced preparation or prerequisites are required for this course. However being part of a series, you may consider taking all related courses in sequence: https://www.illumeo.com/curriculum/cfa-level-1-preparation

Education Provider Information
Company: Illumeo, Inc., 75 East Santa Clara St., Suite 1215, San Jose, CA 95113
Contact: For more information regarding this course, including complaint and cancellation policies, please contact our offices at (408) 400- 3993 or send an e-mail to .
Instructor for this course
  Course Overview CPE
Course Syllabus
INTRODUCTION AND OVERVIEW
  Corporate Governance5:50
  Investment Selection5:29
  Project Selection and The CFA10:00
  Cost of Capital4:36
  Understanding Risk5:30
  Cashflow and Budgeting6:54
CONTINUOUS PLAY
  CFA Level 1 Prep: 5 - Corporate Finance38:19
SUPPORTING MATERIAL
  Slides: CFA Level 1 Prep: 5 - Corporate FinancePDF
  CFA Level 1 Prep: 5 - Corporate Finance Glossary/ IndexPDF
REVIEW AND TEST
  REVIEW QUESTIONSquiz
 FINAL EXAMexam