Corporate Finance For Dummies. Michael Taillard
Part 5, Financial Management: Find out about evaluating corporate financial performance, forecasting future financial performance, and assessing the performance of other corporations for potential mergers and acquisition (M&A).
Part 6, The Part of Tens: Each chapter in this part includes ten things you really should know, whether you intend to pursue corporate finance or not.
Foolish Assumptions
While writing this book, I’ve done my best to assume that you, the reader, know absolutely nothing. That being said, no one is perfect. I strive to point out the details, and when stuff gets too complicated, I just summarize the topic. I also explain — or at least clarify — everything, in normal everyday language, without trying to sound very technical. This book is all about making the subject of corporate finance accessible to everyone, while also trying to keep it from being too dry. Corporate finance books can be boring, which is sad because they don’t need to be. This book is a bit heavy on the math. Yes, I know, math is hard. I never liked it, either. That’s why the majority of the math is supplemented with explanations of how to do the calculations that’s simple enough to spare you from needing to know how to actually read math.
You can also supplement the information in this book by checking out Accounting For Dummies by John A. Tracy (Wiley). It can help give you more detail about these topics. I really tried to only include those details relevant to the subject of corporate finance.
Other than that, if you’re reading this right now, then you’re prepared to begin reading Corporate Finance For Dummies!
Icons Used in This Book
You’ll see a few icons scattered around the book. These icons highlight bits of information that are of particular importance to you. Here’s what to look for:
New to this Edition
First, and arguably more importantly, the writing in this edition has been cleaned up quite a lot and just generally improved over the previous edition. As for content, there are new sections added to this book, such as addressing cryptocurrency and quantitative finance. Information and examples have been updated, while some outdated content was removed.
Beyond the Book
In addition to the abundance of information and guidance related to corporate finance that I provide in this book, you get access to even more help and information online at Dummies.com. Check out this book's online Cheat Sheet. Just go to www.dummies.com and search for “Corporate Finance For Dummies Cheat Sheet.”
Where to Go from Here
This book isn’t linear. I didn’t write the chapters in order, and you don’t have to read them in order. However, you may want to begin with the chapters that are included in Parts 2 and 3 before attempting the chapters in Parts 4 and 5. At least flip through the earlier pages to make sure that you’re familiar with how to read financial statements and the time value of money before you attempt to move on to Parts 4 and 5. As long as you’re familiar with both those things, nothing in this book will be out of your reach.
Part 1
What’s Unique about Corporate Finance
IN THIS PART …
Consider the role that corporate finance plays in your life and make it work for you.
Learn about who’s who in the world of finance and how to find a job.
Get comfortable raising capital, writing grants, and schmoozing investors.
Chapter 1
The Tale of Corporate Finance
IN THIS CHAPTER
Corporate finance is more than just a measure of money. As you see in this chapter, money is incidental to finance. When discussing corporate finance, we are actually looking at the entire world in a new way — a way that measures the entire universe and the things within it in a way that makes it useful to us. We can calculate things in terms of corporate finance that simply can’t be accurately measured in any other way. Throughout this chapter we talk about the nature of money and how it applies to corporate finance.
Telling a Story with Numbers
Corporate finance is the study of relationships between groups of people that quantifies the otherwise immeasurable. To understand how this definition makes any sense at all, first you have to take a quick look at the role of money in the world.
According to Adam Smith, an 18th century economist, the use of money was preceded by a barter system. In a barter system, people exchange goods and services of relatively equivalent value without using money.