FN222 Agriculture Finance and Risk Management
DESCRIPTION
The objective of the unit is to impart knowledge on the broad issues related to lending to credit and financial risk management. The key elements in farm financial accounting systems will be evaluated and the methodologies applied for analysis of farm financial statements outlined. The processes of accounting for risk in investment decision making will be discussed and risk reduction strategies in farm management explored. The role of financial intermediaries, commercial banks and government in agricultural finance will be investigated
RELEVANT COURSES
*Core unit
CREDIT POINTS
10
DELIVERY MODE
On campus
PREREQUISITE OR CO-REQUISITE
AC101 Accounting I
UNIT LEARNING OUTCOMES
LO1 Evaluate the key elements in farm financial accounting systems
LO2 Analyze farm financial statements in detail
LO3 Appreciate the implication of time value of money and its impact on financial decision making
LO4 Understand the process of accounting for risk in investment decision making
LO5 Demonstrate risk reduction strategies in farm management and ability to understand legal considerations in agricultural finance
LO6 Understand the role of financial intermediaries, commercial banks and government in agricultural finance
CONTENT
Introduction to Agricultural Finance
Design of a farm financial accounting system
Analysis of farm financial statements
Time value of money and capital budgeting
Accounting for risk in investment decision making
Strategies for reducing risk
The cost of capital and the optimal capital structure 8 Legal considerations in agricultural finance
Financial intermediaries serving agriculture
Commercial banks and farm lending
Government lending agencies serving agriculture
Investing in Agricultural Commodities, Land and Physical Assets
ASSESSMENT METHODS
1. Online Tests - 10%
2. Report and Oral Assessment - 30%
3. Exam - 50%
PRESCRIBED READINGS
Nil
Check with the lecturer each semester before purchasing any textbooks