Capital structure is an important theoretical concept for risk managers since capital is viewed as the last defense against extreme, unexpected outcomes. The seminar introduces capital structure, advantages and costs related to debt financing, various agency costs, various types of debt and equity, return on equity decomposition, examples of attractive and unattractive debt, bankruptcy and financial distress costs.

 

At the end of Intrinsic Value's training seminar in basics of capital structure the participant should be able to:

􀂅  Explain and Show the formula for the Value of a Firm.

􀂅  Describe the Agency costs of Equity.

􀂅  Describe the Agency costs of Debt.

􀂅  Describe the characteristics of Debt and Equity.

􀂅  Characterize the impact of leverage on ROE volatility.

􀂅  Characterize the impact of taxes on the debt/equity decision.

􀂅  Compare the CFO considerations for issuing debt vs. equity.