Dr Pascal Frantz

This course is available on the Global MSc in Management, Global MSc in Management (CEMS MIM), Global MSc in Management (MBA Exchange), MSc in Accounting and Finance and MSc in Accounting, Organisations and Institutions. This course is available with permission as an outside option to students on other programmes where regulations permit. This course uses controlled access as part of the course selection process. For information on controlled access courses, including eligibility, application processes, deadlines, and departmental contact details, please refer to the Controlled Access Courses webpage.

In previous years, we have been able to accommodate all students that apply but that may not continue to be the case.

Students will be admitted on a first-come-first-served basis, with priority given to MSc Accounting and Finance students, followed by other Accounting students and then students enrolled in programmes listed under the course availability.

Other students who meet the pre-requisite criteria will be considered if space remains.

To maximise your chances of securing a place, we strongly recommend selecting this course during initial course selection in the Autumn Term.

For queries contact: Dot Richards, PG Programme Manager. Department of Accounting d.richards@lse.ac.uk

This course recognizes the complexity of a firm's financial environment affected by potential adverse selection (and moral hazard) issues with firms’ managers knowing more about their firms’ prospects than potential investors.  Managers may use their discretion in disclosing information and reporting to mitigate or exacerbate asymmetries of information.  It introduces a framework for analysing a firm's disclosure policies, accounting choices, and investor relations.  

This course first introduces settings characterised by adverse selection in which managers may communicate their private information to the market.  It then analyses conditions under which disclosures can take place either directly or indirectly through accounting choices to reduce information asymmetries. 

This part of the course uses game theory to analyse corporate voluntary disclosures and financial reporting.  No prior knowledge of game theory is required as the required game theoretical tools are introduced at the beginning of the course.  Whilst game theory relies on logic, its application does not rely on mathematics.  A basic knowledge of statistics is helpful but not essential.

The second part of the course extends its investigation to investor relations recognizing the richness of a firm’s information environment.  It explicitly considers the roles played by investment relation officers, sell-side and buy-side analysts, proxy advisory firms, corporate governance, institutional shareholders, block holders, and shareholder activists.  It furthermore analyses investor relations in mergers and acquisitions as well as initial public offering settings.  This part of the course does not rely on game theory.  Instead, it is led by case-studies.  Participation by students is not only encouraged.  It is essential.

Detailed choice of subjects to be covered will be determined by those lecturing on the course and may vary to some extent from year to year. Knowledge of basic accounting and finance is assumed.

30 hours of seminars in the Autumn Term.

This course has a reading week in Week 6 of Autumn Term.

There will be two 90 minute sessions each week. Each session is conducted in groups of about 60 students, often involving case study analyses, application exercises and group presentations and discussions. This mode of teaching requires good advance preparation by the students; hence, every student should be ready to contribute to the discussion when called upon. Active participation is expected and encouraged.

Formative assessment will be in the form of class exercises and case-studies on topics covered during the course. Students will be expected to hand in a single group assignment in the AT.

The course relies mostly on HBR readings, lecture notes, journal articles, and chapters from relevant books supplied in online study packs.

Exam (70%), duration: 120 Minutes in the Spring exam period.

Case analysis / study (30%).

The group work will comprise two assignments, the last one including a presentation.