BFF1001 Foundations of Finance
The Complete Study & Assessment Guide · S2 2026BFF1001 Overview
- Monash Business School
- Semester 2, 2026
- an undergraduate foundation finance unit
- 6 credit points
- a finance foundation unit
BFF1001 introduces the financial system, financial mathematics, valuation, capital budgeting, household finance, institutions, regulation, equity, debt and foreign exchange. It is taught within Monash Business School. It is an undergraduate foundation finance unit. It carries 6 credit points.
- Draw cash flows first Timing and sign errors are usually more damaging than calculator errors.
- A rate needs a period Never compare annual, monthly, nominal and effective rates without conversion.
- Price is discounted claims Equity, debt and projects differ in the claims and risk embedded in their cash flows.
- Only the outer split is settled Current sources support 60% exercises and 40% test; the finer exercise split conflicts.
How BFF1001 is assessed
| Component | Weight | Format |
|---|---|---|
| Exercise stream | 60% | Current Moodle controls individual exercise names, dates and internal allocation |
| Within-semester test | 40% | Current Moodle controls date, conditions and coverage |
Current public and Moodle assessment surfaces agree on an Exercise stream worth 60% and a within-semester Test worth 40%, with no final exam. One internal allocation table conflicts with another exercise detail, so this Bible deliberately does not publish a finer 20/40 or 30/30 split as settled fact.
Current BFF1001 dates
| Date | Item | Control |
|---|---|---|
| Current S2 teaching period | Exercise stream | 60% in aggregate; consult live Moodle for the reconciled internal split and deadlines. |
| Current S2 teaching period | Within-semester test | 40%; live Moodle controls exact operation. |
Current-offering dates captured in the course materials. Confirm changes and exact submission settings in the live LMS.
What BFF1001 covers
The learning path moves from Finance, the Financial System and Interest Rates, through the problems opened by Financial Regulation and Risk Management, to the synthesis required in Foreign Exchange and Cross-Currency Decisions.
Finance, the Financial System and Interest Rates
financial system · surplus unit · interest rate · trace funds from savers through markets or intermediaries to users02Present Value, Future Value and Rate Conversion
present value · future value · effective annual rate · move a cash flow across time and compare rate conventions03Annuities, Perpetuities and Loan Payments
annuity · perpetuity · amortisation · value repeated payments and reconcile a loan balance04Capital Budgeting and Net Present Value
net present value · incremental cash flow · opportunity cost · build and evaluate project cash flows using NPV05Mortgages, Superannuation and Household Finance
mortgage · superannuation · liquidity constraint · compare repayment, liquidity and retirement trade-offs06Financial Regulation and Risk Management
prudential regulation · market conduct · risk appetite · connect a financial risk to governance, capital, conduct and monitoring controls07Financial Institutions and Intermediation
financial intermediary · maturity transformation · liquidity risk · explain how institutions earn spreads while transforming risk and liquidity08Equity Securities and Share Valuation
ordinary share · dividend yield · required return · connect dividends, growth and required return to a share value09Debt Securities, Yields and Interest-Rate Risk
bond · yield to maturity · interest-rate risk · price a bond and explain inverse price-yield movement10Foreign Exchange and Cross-Currency Decisions
exchange rate · appreciation · cross rate · convert cash flows and diagnose currency exposure without reversing the quoteIt is positioned as a finance foundation unit.
The unit connects time-value calculations to household, corporate, institutional and market decisions without a final examination.
Assessment in bff1001 is distributed as follows: an Exercise stream worth 60% and a within-semester Test worth 40%; current sources conflict on the exercise stream's finer internal split
The operational assessment conditions matter here.
No final examination is published in the current S2 structure; the 40% test is held within semester.
What makes bff1001 demanding is concrete: turning a verbal finance decision into correctly timed cash flows and then keeping rate period, compounding, sign, risk and decision interpretation aligned
No numeric component hurdle is published in the retrieved current Handbook or Moodle surfaces; the overall unit pass standard applies.
For enrolment planning, Confirm current course-map eligibility and prohibition rules in the Monash Handbook.
The learning path moves from Finance, the Financial System and Interest Rates, through the problems opened by Financial Regulation and Risk Management, to the synthesis required in Foreign Exchange and Cross-Currency Decisions.
Choose between two savings rates
- 1Convert Account A to an effective annual rate.
- 1Compute (1+0.058/12)^12-1.
- 1Compare with 5.9%.
- 1State that fees, tax and access may change the decision.
Key terms
- financial system
- Institutions, markets, instruments and infrastructure that move funds and allocate financial risk. This chapter uses the concept when students trace funds from savers through markets or intermediaries to users.
- surplus unit
- Household, firm or government whose saving exceeds current funding needs. It helps explain the reasoning required to trace funds from savers through markets or intermediaries to users.
- interest rate
- Price of transferring purchasing power across time, expressed for a stated period and convention. Its limit matters because a quoted rate is uninterpretable without maturity, compounding, credit and inflation context.
- present value
- Current equivalent of future cash flow discounted at a rate reflecting time and risk. This chapter uses the concept when students move a cash flow across time and compare rate conventions.
- future value
- Amount to which current value accumulates under a stated rate and number of periods. It helps explain the reasoning required to move a cash flow across time and compare rate conventions.
- effective annual rate
- Annual growth rate including within-year compounding. Its limit matters because discount rate, cash-flow period and compounding frequency must refer to compatible units.
- annuity
- Finite sequence of equal payments at regular intervals under a stated timing convention. This chapter uses the concept when students value repeated payments and reconcile a loan balance.
- perpetuity
- Level cash-flow stream continuing indefinitely in the simplified model. It helps explain the reasoning required to value repeated payments and reconcile a loan balance.
- amortisation
- Repayment process splitting scheduled payments between interest and principal. Its limit matters because ordinary, due, growing and irregular streams require different timing treatment.
- net present value
- Present value of incremental project benefits less present value of incremental costs. This chapter uses the concept when students build and evaluate project cash flows using NPV.
- incremental cash flow
- Cash flow that occurs because the project is accepted rather than rejected. It helps explain the reasoning required to build and evaluate project cash flows using NPV.
BFF1001 FAQ
Where do students usually lose marks in bff1001?
turning a verbal finance decision into correctly timed cash flows and then keeping rate period, compounding, sign, risk and decision interpretation aligned
How is bff1001 assessed?
an Exercise stream worth 60% and a within-semester Test worth 40%; current sources conflict on the exercise stream's finer internal split
What is the bff1001 final assessed-task format?
No final examination is published in the current S2 structure; the 40% test is held within semester.
Does bff1001 have a hurdle or component-level pass rule?
No numeric component hurdle is published in the retrieved current Handbook or Moodle surfaces; the overall unit pass standard applies.
Which offering does this bff1001 guide cover?
It is aligned to Semester 2, 2026; confirm your enrolled class and timetable in the current institutional system.
What prerequisites or restrictions apply to bff1001?
Confirm current course-map eligibility and prohibition rules in the Monash Handbook.
How to prepare for the assessments
Retrieve the course map, practise the recurring method—identify the financial decision and timing, draw the cash flows, select a valuation or risk relation with compatible units, compute transparently, then stress assumptions and interpret the result for the decision maker—on changed scenarios, and verify every operational assessment detail in the live institutional system.
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