AHT231 Agricultural Finance (8)

Abstract

You will find this to be a very applied subject in which you will develop skills and knowledge needed to appraise possible agricultural business investment decisions. The learning will be invaluable for anyone involved with any agricultural business, irrespective of its size or location.
You will engage with the subject area through problem solving contexts derived from actual case situations. Once underlying principles are understood, you utilise project budgets to analyse and compare alternative investments using capital budgeting techniques while recognising and weighing the social and environmental considerations associated with such investments. The source, range and suitability of different types of loan finance available for investment in agricultural business development projects are examined and strategies explored for obtaining such finance.

+ Subject Availability Modes and Location

Session 1
Internal	Orange Campus
Internal	Wagga Wagga Campus
Distance	Orange Campus
Distance	Wangaratta

Continuing students should consult the SAL for current offering details: AHT231
Where differences exist between the Handbook and the SAL, the SAL should be taken as containing the correct subject offering details.

Subject information

Duration	Grading System	School:
One session	HD/FL	School of Rural Management

Learning Outcomes

Upon successful completion of this subject, students should:
- Be able to distinguish between nominal and real values and interest rates and identify the appropriate format to use in a variety of applied contexts;
- be able to analyse a financial problem and select an appropriate process for its resolution;
- be able to apply financial procedures correctly to account for the cost of time associated with the resolving a diverse range of problem solving situations;
- be able to derive budget data for a development project to be appraised and present this data professionally in a format suitable for capital budgeting;
- be able to complete computations necessary to analyse and compare validly two alternative investments using capital budgeting techniques while considering the holistic implications of these projects;
- be able to establish the finance requirements for a range of investment situations involving rural and agribusiness enterprises;
- be able to evaluate the types and sources of finance available for particular investment situations and derive the financial arrangement that best matches the requirements of the business;
- be able to identify the information requirements and formulate the strategies needed to secure investment finance in an ethical manner;
- be able to monitor and adjust the finance of the business in response to changing circumstances.

Syllabus

The subject will cover the following topics:
Financial Procedures differentiating nominal and real values for financial decision making purposes opportunity cost and time assessing the weighted average cost of capital and calculating the interest rate to use compounding, discounting, annuities, amortisation and sinking funds applying financial procedures for practical solutions Appraising Investments investment appraisal for financial managers developing budgets for project appraisal Net Present Value method Payback Period technique Benefit/Cost ratio technique Internal Rate of Return strengths and weaknesses of the various techniques applying a sensitivity analysis to allow for risk in capital project evaluation integrating societal and environmental considerations in capital project investment decisions applications of capital budgeting in a practical context. Financing Investments assessing the financial requirements for investment evaluating sources and types of credit, their features and costs matching finance need to finance instruments approaches to obtaining business finance managing an ethical business/lender relationship in a changing financial environment.

Back