Course description

Title of the Teaching Unit

International Finance and Fiscality

Code of the Teaching Unit

21IDM40

Academic year

2023 - 2024

Cycle

Number of credits

Number of hours

Quarter

Weighting

Site

Anjou

Teaching language

English

Teacher in charge

VLAMINCK Luc

Objectives and contribution to the program

Part A - International Finance
General objectives
• The course is designed to understand the nature of financial risks associated with different corporate business models. In that perspective, the student will be confronted with the basic financial products (Foreign Exchange and Interest Rate). The good management of these financial products will allow him to elaborate adequate risk hedging strategies.
• The student will also be introduced to financial markets behavior.
• Finally, he will become acquainted with the role of a treasury department within the corporate organization.
Learning Objectives & Goals
a. Acquire a good understanding of all financial products
b. Understanding of financial market behavior
c. Ability to evaluate financial risks
d. Ability to elaborate appropriate hedging strategies
e. Ability to quote basic financial products
Part B – International Trade Finance
General objectives
• The course is designed from the perspective of a company that evolves on the world trade market. Cross country exchanges through multi-national firms have been significantly growing with the globalization of the economy.
• Concepts in the course are developed through themes of international management such as risks in international markets and the way to assess and mitigate them. Various methods of payments are analyzed in the details to highlight the inherent credit risk and their operational processes. A focus is also given on key negotiation issues in international contracts, incoterms, customs and recent regulatory requirements. Finally, the course concentrates on short and long term financing of international commercial transactions, under various schemes with the intervention of commercial banks and export credit agencies.
Learning Objectives & Goals
f. risk categories, risk assessment and risk mitigation
g. key financial issues in commercial agreements
h. risk transfer and cost acceptance in Incoterms
i. ways to mitigate open account payments
j. financing techniques for deferred payments
k. supporting institutions for international trade financing
l. understand risks and opportunities of international trade finance
m. develop diversified tools in international payments
n. manage working capital requirements by various financial techniques
Part C – International Fiscality
General objectives
Due to increase in the number of cross border transactions, signing of new free trade agreements and globalization, international taxation is becoming more and more complex. Being aware of the growing tax complexity and its impact on commercial operations both within the EU and with non-EU countries is critical for effective international business management. From this perspective, the course is designed to provide firstly an understanding of the basic principles of how taxation applies to international trade transactions and secondly the knowledge to recognize key tax issues & risks and to get edge information. The emphasis will be on the fundamental concepts of corporate taxation and on the transfer pricing principles regarding direct taxes, and on the EU VAT main rules and customs concerning indirect taxes.
Learning Objectives & Goals
a. Basics of international taxation
b. VAT and custom duties impact in an international context (intra-Community acquisition, export and import transactions).
c. Transfer pricing principles in cross-border relationships within a group.
d. Recognize key tax issues and risks.
e. Understand the basics of international taxation.
f. Identify direct tax risks associated with international transactions/financial flows.
g. Be aware of VAT and custom duties impact in an international context (intra-Community acquisition, export and import transactions).
h. Understand transfer pricing principles in cross-border relationships within a group.
i. Have acquired sufficient knowledge to recognize key tax issues and risks.
j. Elaborate basic strategies to decrease tax costs.

Competency Goals :

CG 1 Disciplinary Knowledge
CG2 Operational
CG4 Open to the world
CG5 Aware of complexity / Critical Mind
CG6 Communicate orally and in writing in several languages

Prerequisites and corequisites

Part A - International Finance
• International economic fundamentals
• Financial management

Part B – International Trade Finance
• Basics in accounting, tax , treasury, financial management and strategy
• Students might be asked to read one or more business cases in advance of each class (a few pages per case).

Part C – International Fiscality
• Tax law (13DR010)
• Students might be asked to read one or more business cases in advance of each class (a few pages per case).

Content

Part A - International Finance
• The origin of financial markets
• The foreign exchange risk
• The interest rate risk
• The corporate treasury organization

Part B – International Trade Finance
? Opportunities and risks
? International operations unfolded
? Short term financing of international operations
? Long term financing of international operations

Part C – International Fiscality
? Basics of international taxation
? International Tax Treaties, EU Directives, and Double Tax Relief & Avoidance
? Corporate taxation (computation of the taxable base) and transfer pricing principles.
? Indirect tax: the EU VAT main rules and customs related to intra-Community acquisition and import/export transactions.
? International taxation as leverage for corporate strategy in the global marketplace

Teaching methods

Ex cathedra teaching and case studies.

Assessment method

Part A - International Finance - Written exam

Part B - International Trade Finance - Written exam

Part C - International Fiscality - Written exam

Calculation method

For the ICHEC department, where a teaching unit (UE) comprises several learning activities (AA), the overall grade for the UE is calculated as follows:
- If all the scores obtained for the different learning activities are greater than or equal to 10/20, the overall score will be the weighted arithmetic mean (based on the relative importance of each of the AAs in the UE) of these scores.
- If at least one of the scores obtained for an AA is less than 10/20, the overall score will then be the weighted geometric mean of the AA scores.
These modes of calculation apply when a Teaching Unit consists of several learning activities.

References

See pedagogical document