1

FBE 458 – Law, Finance and Ethics

Syllabus – Fall 2013

Professor: Kevin C. Fields

Office: Bridge Hall 303E

Office Phone: 213.740.8764

E-mail: kfields@marshall.usc.edu (preferred method of

communication)

Course Website: Blackboard http://blackboard.usc.edu

Lecture Class

Mon. & Wed.

Room:

Section:

2:00 – 3:50 PM

HOH 1

15367R

Office Hours

Mondays 12:30 – 2:00 PM (or by appointment)

Wednesdays 12:30 – 2:00 PM (or by appointment)

Course Description

FBE 458 (4 units) provides a study of the laws affecting the operation of businesses.

Business ethics will be discussed throughout the course. Students will understand the practical

aspects and strategies of financing and managing businesses from incubation to going public. The

student will secure the knowledge necessary to effectively work in private and public business

entities by acquiring a sound grasp of the relevant concepts, legal vocabulary, and rules of law that

apply.

In an overview, the course material includes: agency law; legal aspects of starting

businesses; sole proprietorships; general and limited partnerships; limited liability companies;

franchises and special forms of doing business; administrative law; credit, mortgages and debtor’s

rights; secured transactions; bankruptcy and reorganization of businesses; accountants duties and

liabilities; insurance; and corporate formation, governance, liabilities, antitrust, and mergers and

acquisitions. Many of the topics covered in this course are tested in the CPA examination.

Learning Objectives

This course is designed to provide a broad framework and understanding of relevant issues

students will face as potential business owners, employees, parents, and citizens of society. This

course will help you develop the following:

2

Global Objective

o Equip students to recognize general principles of business law and be able to identify

and distinguish legal and ethical issues and legal terminology of business organizations

and finance.

o Examinations will primarily test student’s ability to integrate knowledge ranging from

issue spotting, identifying legal issues and applying substantive law to factual scenarios.

In many situations, students will have to distinguish between relevant and irrelevant

facts to analyze the legal problem. The students will be challenged to be critical thinkers

as they learn and apply the material.

Detailed Objectives

o Recognize ethical conflicts in the governance of business organizations and be able to

distinguish alternative actions to pursue.

o Increase the ethical sensitivity of students by exposing them to business related legal

problems that have ethical issues.

o Acquaint students with rules and regulations concerning principal and agency

relationships and how they are acquired and terminated.

o Identify and recognize the different types of business entities and the protections and

risks of utilizing each type of entity. Students will be able to recognize general

partnerships, limited partnerships, limited liability partnerships, limited liability

companies and corporations.

o Recognize the process of forming and financing a corporation. Understand the

governance required of corporations and the affect Sarbanes-Oxley has to corporations.

Identify the methods that a corporation can be acquired.

o Describe how businesses can create a security interest in personal property and the

importance of a financing statement.

o Identify the different types of bankruptcy and reorganization provided for under federal

and state law.

o Describe the liability an accountant owes to its client and third parties and the criminal

and civil liability an accountant may face for breaches of its duties.

Required Materials Textbook: Business Law (8th Edition)

Author: Henry R. Cheeseman

Publisher: Prentice Hall (2013)

ISBN-10: 1-25-663717-3

ISBN-13: 978-1-25-663717-2

Electronic study guide. The study guide should come as part of the book with the above

ISBN (I was able to have the publisher provide the study guide for free as part of the book

order).

Other: Slides, handouts, supplemental readings/articles, and grades will be posted on

Blackboard

Prerequisites: None

3

Course Notes: Course materials will be provided on the course BlackBoard site. The course

BlackBoard site will include:

1. Course Documents

a. Includes this syllabus, any assigned readings, and related team presentation

information.

2. Lecture slides

a. The PowerPoint lecture slides are grouped by topics covered on Midterm 1, Midterm

2 and the Final respectively.

b. The slides are guides for classroom topics and discussion. You are required to know

the material discussed in the book and in the classroom – the slides are not

comprehensive as to what you are expected to know and be tested on.

c. Slides will be posted frequently throughout the semester.

3. Any supplemental materials discussed in class

4. Team Presentations

a. All team presentations will be posted under this link

5. Exam and Grade Information

a. Midterm & Final exam answer keys

b. Midterm & Final grades

c. I will periodically post a class total point standing by student ID number. The

information will be posted and current as of a certain date clearly indicated by the

file. Note the first posting of point standing will occur after the first midterm.

i. You are responsible for verifying that your grades are properly recorded.

The last day to make any correction to the gradebook is the last day of class.

No gradebook corrections will be made thereafter, including after the final

exam is taken.

6. Office Hours (located in Bridge Hall 303E)

a. If students have any questions about the material covered in the class they should not

hesitate to see or contact me.

b. If a student cannot make the regular office hours, they should first try to send me an

email. While I can also be reached at 213.740.8764 where students can leave a

message on my voice mail with their name and phone number (with area code), my

teaching responsibilities make it nearly impossible for me to promptly respond to

students’ telephone calls. However, I usually check and respond quickly to email

and at all hours of the day (and night).

7. Check the dates of your final examinations. No makeup for a final examination will be

given, with the following exceptions:

a. If the student can establish to my satisfaction that the student has three final

examinations on the same day one is scheduled for this class. The current policy of

the University of Southern California is to reschedule one of three regularly

scheduled final exams on one day; and/or,

4

b. If the student can establish to my satisfaction there is a verifiable conflict with any

other regularly scheduled examination during the final exam period for this class; or,

c. In the context of extenuating circumstances with my prior written permission given

in advance of an examination. Verifiable proof will be required to evidence the basis

for such a request.

d. Note the foregoing does not apply to midterm examinations or the dates other

assessments are due.

Key Course Dates

Please Note: The date/time of the Final Exam is determined by the University. For the date and

time of the final for this class, consult the USC Schedule of Classes at www.usc.edu/soc. Select the

corresponding semester to view and click on the “Final Examinations Schedule” link on the left

side of the screen.

Grading Summary:

Final grades for this course depend upon how students perform in this class relative to other

students. Consistent with the grading standards and policies of the Marshall School of Business,

and the academic policies and procedures of the University, for elective courses, such as this one,

the suggested targeted mean GPA is 3.3. While there is no mandated curve or hard target, the

suggested GPA of 3.3 has been consistent with the historical average grades earned in this class.

There is no specific guideline with respect to the number or percentage of any specific grade given

or the numbers of persons who pass or fail the course. Thus, discretion is given to each instructor

regarding the assignment and distribution of grades.

Date Time

1st Midterm Exam Monday, September 23

rd During class

2nd

Midterm Exam Wednesday, October 30th During class

Negotiation Paper Monday, November 18th Beginning of class

Final Exam Friday, December 13th 2-4 p.m

Assessment Points % of Grade

Tests

Midterm #1 150 25%

Midterm #2 180 30%

Final Exam 160 27%

Team Presentation 40 7%

Negotiation Exercise & Paper 30 5%

Participation 40 7%

Total points 600 100%

FBE 458 Grading

5

Students will receive a grade after each Midterm and prior to the final examination;

however, the more important performance predictor will be their class rank. Rank is more

important than the interim letter grades because at the end of the semester, the total points

accumulated throughout the semester are “curved” to ensure compliance with the Marshall

suggested policies. Since the final curve is based on the total point standing in the class, your

performance throughout the semester on midterms, the final examination and any assignments is

strongly correlated to your final grade in the course.

Once the curves are in place, they will not be reset to accommodate individual requests. No

relief will be granted on that basis. Grades are not open to negotiation. Petitions for exceptions or

understanding of particular needs to attain a higher grade for some reason will not be honored.

What is done for one student must be done for all, and the result is that if one student’s grade is

adjusted, so will all other students’ grades.

Typically about 25 points (+/- 5-10 points) typically separate each grade (i.e. B+ to an A-,

etc.). If trends continue with student performances, approximately 15-20% of the class will earn an

A, 15-25% will earn an A-, 20-30% will earn a B+, 10-15% will earn a B, with the balance earning

a B- or below. This is not a predictor for grading for this specific class as each class is unique.

ASSIGNMENTS AND GRADING DETAIL

Exams

All examinations are closed book/closed notes and non-cumulative. While every

examination will ask students to recognize definitions, the focus of the examinations will be on the

application of the legal principles that have previously been taught in the course. In preparing for

an examination, students should know the legal principles provided in all the materials and

concentrate on applying them to factual situations. It can be very helpful to form and use a study

group to review the material. Cooperative learning assists students in identifying their areas of

weakness.

Exam Policies

1. Exams will be primarily by scantron. For each examination will consist of a few (~2-4)

short answer or fill in the blank questions and the balance multiple choice or true false

questions. I will supply scantrons and any paper for the short answer and possible short

essay question for your use.

2. No cell phones, smart phones/devices (including but not limited to iPhone’s, iPad’s,

blackberry’s, etc.), text messaging devises, laptops or similar equipment are to be used

during any examination.

3. No talking during any exam. Failure to abide by this rule may result in not receiving

credit for the exam.

4. It is your responsibility to check your exam to ensure that no pages are omitted and that

you have answered all of the questions. Requests for regarding due to claimed missing

pages will not be honored.

6

5. You are responsible for erasing modified answers on your scantron. Scantrons that are

incorrectly graded due to poor erasure marks will not be honored.

6. Unfortunately, from time to time, exam answers are incorrect. In the event the answer

key was incorrectly marked (i.e. the answer is B rather than C) the exam will be graded

to reflect the correct answer. Where there are two or more correct answers, both answers

will receive credit. Where the question is vague all will receive credit for that question.

Makeup Exams

Make-up midterms will be given only in exceptional circumstances and will require prior

written permission. Student-athletes and others with verifiable schedule conflicts with the exam

schedule must make arrangements with the instructor one to two weeks prior to an exam date.

Exam answer challenges, discussed below, do not apply to makeup examinations. In

addition, on occasion I have been known to include an extra credit question on examinations.

Makeup examinations do not include any extra credit questions. It is prudent to make every effort

to take the exam at the scheduled time.

Exam Answer Challenges

Exam answers will be posted shortly after the exam (typically within a few hours). If you

want to challenge the posted answer, you must do the following within 2 calendar days of the

posting of the answer key (for Midterm 1 and 2). Challenges to the final must be provided

within 1 calendar day of the posting of the answer key:

1. E-mail me with the following information:

a. the name of the course & time and date we meet in the subject line;

b. the version number of the test (A or B);

c. the question number involved; and,

d. A complete analysis and argument of why your choice is the best of those presented

within 2 calendar days of the examination. Your arguments are to be based upon

what has been taught in the course and in the book. Arguments based upon

extraneous analyses are not read.

2. I will post a revised answer key to the exam on Blackboard

3. No further discussion of the answers will be entertained as the curve will be set following

the challenge period.

Participation and Preparation

Students are expected to read each week’s assigned reading prior to class, and be prepared

to discuss and examine the concepts during class. It is expected that students will have read the

material in advance in order to make the class periods as engaging as possible. Students should

always proceed to the next reading assignment whether the previous reading has been fully

discussed in class. Students should also prepare thoroughly before class, making sure that they are

7

clear on each concept as they progress through the course. Please do not hesitate to ask (or answer)

questions. I enjoy the discussion.

To encourage students to prepare for class, participation will be taken 5 times during the

semester. While the various tasks that make up the participation may vary over the semester (e.g.

Poll Everywhere participation, in class questions, etc.) credit for participating will be counted by

your signature on a participation sheet taken on the day participation is checked. Failure to sign the

participation log on the day of the participation will result in not receiving participation for the day.

Only 4 of the 5 participation checks will be counted for each student (i.e. you are allowed to miss 1

of the 5 times participation is taken and still receive full participation points). Each of the 4

participation checks counted is worth 10 points for a total of 40 points in the course. Participating

at all 5 checks does not give you any additional points as 1 participation check is not counted.

Students who routinely and consistently participate in meaningful class discussions may

receive participation points to offset a missed class or two when a participation check was

administered.

If you will miss class to participate in a university sponsored activity, or religious holiday,

you are responsible for informing your instructor in writing at least one week before the impending

absence. Such absence shall not count as a missed class.

Having a job application, the cold, flu, or just not wanting to attend class are not excused

absences and you will not receive credit for the day missed. This is why I allow you to miss 1 of

the participation checks and I don’t check it every class session.

Poll Everywhere

To improve interaction and stimulate discussion during class I plan to use Poll Everywhere

to test student’s understanding of concepts discussed in class. In order to participate with Poll

Everywhere you need to bring your cell phone, smartphone or laptop to class. You will be able to

submit your answers to in class questions by either text messaging the answer or voting over the

web.

Poll Everywhere will be used often with end of chapter questions throughout the semester

designed to assist you in understanding the material. They assist me in focusing and explaining

answer choices that many people have missed without utilizing class time for answer

choices/questions that the class understands.

Team Presentations

During the first week of the course students will select a team and topic to present during the

course. The dates of the team presentation are set forth on the reading and assignments grid below.

Presentation coverage and a grading grid for the assignment are posted on Blackboard. You may

not change team membership without my prior permission once teams are selected. Your group

may suggest a different presentation topic to me as outlined in the Blackboard posting.

8

These presentations are to reflect your best work and considerable effort should be

undertaken in their preparation. The grading key is found within the presentation grading sheet

posted on Blackboard.

Negotiation Exercise and Paper

Students will take part in a negotiation exercise this semester on a topic or legal principle

discussed in this course to provide a real world experience to the concepts learned in class. You

may be required to read a brief summary prior to class of the exercise and prepare any pre class

required documents. Detailed information will be provided on Blackboard entitled under

Negotiation Exercise. Students will need to prepare a short paper on their experience. More details

related to this assignment with instructions will be provided on Blackboard.

No recording and copyright notice

No student may record any lecture, class discussion or meeting with me without my prior

express written permission. The word “record” or the act of recording includes, but is not limited

to, any and all means by which sound or visual images can be stored, duplicated or retransmitted

whether by an electro-mechanical, analog, digital, wire, electronic or other device or any other

means of signal encoding. I reserve all rights, including copyright, to my lectures, PowerPoint

slides, course syllabi and related materials, including summaries, exams (current and prior), answer

keys, and all supplementary course materials available to the students enrolled in my class whether

posted on Blackboard or otherwise. They may not be reproduced, distributed, copied, or

disseminated in any media or in any form, including but not limited to all course note-sharing

websites. Exceptions are made for students who have made prior arrangements with DSP and me.

Actions in violation of this policy constitute a violation of the Student Conduct Code, and may

subject an individual or entity to university discipline and/or legal proceedings.

No Legal Advice

The material presented and the classroom discussions are for the students’ edification. They

are not intended to be legal advice to students in connection with any legal issue they or others may

have. If students have a legal matter, they are advised to promptly consult an experienced attorney

who can confidentially and fully review the facts and advise them of their legal rights and remedies.

Quite often, the facts dictate the result and only in the context of an attorney-client relationship can

they be reviewed and legal opinions rendered.

MARSHALL GUIDELINES

Add/Drop Process

In compliance with USC and Marshall’s policies classes are open enrollment (R-clearance)

through the first week of class. All classes are closed (switched to D-clearance) at the end of the

first week. This policy minimizes the complexity of the registration process for students by

standardizing across classes.

9

I can drop you from my class, without prior consent, if you don’t attend the first two class

sessions. The instructor is not required to notify the student that s/he is being dropped. Please note:

If you decide to drop, or if you choose not to attend the first two sessions and are dropped, you risk

being not being able to add to another section this semester, since they might reach capacity. You

can only add a class after the first week of classes if you receive approval from the instructor.

Retention of Graded Coursework:

Final exams and all other graded work which affected the course grade will be retained for

one year after the end of the course if the graded work has not been returned to the student; i.e., if I

returned a graded paper to you, it is your responsibility to file it, not mine.

Statement for Students with Disabilities

Any student requesting academic accommodations based on a disability is required to

register with Disability Services and Programs (DSP) each semester. A letter of verification for

approved accommodations can be obtained from DSP. Please be sure the letter is delivered to me

(or to my TA) as early in the semester as possible. DSP is located in STU 301 and is open 8:30

a.m.–5:00 p.m., Monday through Friday. The phone number for DSP is (213) 740-0776. For more

information visit www.usc.edu/disability. Please provide me (or my TA) the appropriate form

two weeks in advance of an examination.

If you are taking an examination at the DSP office and believe that a question is unclear,

incomplete, ambiguous or otherwise defective, you are advised that additional pages will be

attached to the examination placed at DSP. If you are making such a contention, then, you are

required to clearly state the problem you encountered with the question and why you answered the

question in the manner you did. Only with such information in hand at the time I grade your

examination will I be able to gauge the appropriateness of giving you credit for your answer to the

subject question.

If for some reason, you must take the examination after the class has taken the examination,

you will take a comparable examination to that given the students in class.

Statement on Academic Integrity

USC seeks to maintain an optimal learning environment. General principles of academic

honesty include the concept of respect for the intellectual property of others, the expectation that

individual work will be submitted unless otherwise allowed by an instructor, and the obligations

both to protect one’s own academic work from misuse by others as well as to avoid using another’s

work as one’s own. All students are expected to understand and abide by these principles. SCampus,

the Student Guidebook, (www.usc.edu/scampus or http://scampus.usc.edu) contains the University

Student Conduct Code (see University Governance, Section 11.00), while the recommended

sanctions are located in Appendix A.

Students are expected to be familiar with USC’s Academic Integrity Policies (i.e., copying,

fraudulent possession of an exam, plagiarism, submission of purchased papers, submitting the same

assignment to more than one instructor) and be aware of recommended sanctions (i.e., F for the

10

course, suspension or expulsion) associated with violating such policies. See Appendix A in the

SCAMPUS Guidebook for more detail.

Students will be referred to the Office of Student Judicial Affairs and Community Standards

for further review, should there be any suspicion of academic dishonesty. The Review process can

be found at: http://www.usc.edu/student-affairs/SJACS/. Failure to adhere to the academic conduct

standards set forth by these guidelines and our programs will not be tolerated by the USC Marshall

community and can lead to dismissal.

The following are considered unacceptable examination behaviors: communication with

fellow students during an examination, copying materials from another student’s exam, allowing

another student to copy from an exam, the use of electronic devices to communicate to others

during the exam, possession or use of unauthorized notes, electronic or other dictionaries during

exams. The University’s Student Conduct Code will be strictly applied. Students cannot achieve

grades that they have not legitimately earned. Part of Marshall’s mission is to remind students of

the value systems that will regulate their business lives, and breaching ethical standards cannot be

condoned.

Emergency Preparedness/Course Continuity

In case of emergency, and travel to campus is difficult, USC executive leadership will

announce an electronic way for instructors to teach students in their residence halls or homes using

a combination of Blackboard, teleconferencing, and other technologies. Instructors should be

prepared to assign students a "Plan B" project that can be completed at a distance. For additional

information about maintaining your classes in an emergency please access:

http://cst.usc.edu/services/emergencyprep.html

Please activate your course in Blackboard with access to the course syllabus. Whether or not

you use Blackboard regularly, these preparations will be crucial in an emergency. USC's

Blackboard learning management system and support information is available at

blackboard.usc.edu.

Incomplete Grades Explanation

In incomplete (IN) grade may be assigned due to an “emergency” that occurs after the 12th

week of classes. An “emergency” is defined as a serious documented illness, or an unforeseen

situation that is beyond the student’s control, that prevents a student from completing the semester.

Prior to the 12th

week, the student still has the option of dropping the class. Arrangements for

completing an IN course should be initiated by the student, and negotiated with the instructor.

Class work to complete the course should be completed within one calendar year from the date the

IN was assigned. The IN mark will be converted to an F grade should the course not be completed.

Evaluation of Your Work

You may regard each of your submissions as an “exam” in which you apply what you’ve

learned according to the assignment. I will do my best to make my expectations for the various

assignments clear and to evaluate them as fairly and objectively as I can. If, however, you feel that

an error has occurred in the grading of any assignment, you may, within one week of the date the

11

assignment is returned to you, write me a memo in which you request that I re-evaluate the

assignment. Attach the original assignment to the memo, and explain fully and carefully why you

think the assignment should be re-graded. Be aware that the re-evaluation process can result in

three types of grade adjustments: positive, none, or negative.

Date Day Reading Material Team Presentations

8/26 M Syllabus

8/28 W Chapter 42: Ethics and Social Responsibility of Business

9/2 M

9/4 W Chapter 29: Agency Formation and Termination

9/9 MChapter 30: Liability of Principals, Agents and

Independent ContractorsTeam 1: Ethics case study

9/11 WChapter 34: Small Businesses, Entrepreneurs and General

Partnerships

Team 2: 2 IRACs from the end of the chapter problems on

liability of principals and agents (Ch. 30) .

9/16 M Small Businesses, Entrepreneurs and General

Partnerships (cont.)

Team 3: Case study on social media use by

companies.

9/18 WChapter 35: Limited Partnerships and Special

PartnershipsTeam 4: Ethics case study

9/23 M

9/25 WChapter 39: Limited Liability Companies and Limited

Liability PartnershipsTeam 5: Personal and business lines of credit

9/30 M Chapter 40: Franchises and Special Forms of Business Team 6: Bond rating agencies .

10/2 W Chapter 43: Administrative Law and Regulatory Agencies Team 7: Hedge funds

10/7 M Chapter 26: Credit, Mortgages, and Debtor's Rights Team 8: Healthcare Initiative and Businesses

10/9 W Chapter 27: Secured Transactions and E-Filing Team 9: Causes for current recession

10/14 M Secured Transactions and E-Filing (cont.) Team 10: Ethics case study

10/16 W Chapter 28: Bankruptcy and ReorganizationTeam 11: 2 IRACs from end of the chapter problems

(Ch 27).

10/21 M Bankruptcy and Reorganization (cont.)Team 12: Case study on high profile bankruptcy

proceedings.

10/23 W Chapter 51: Accountants' Duties and Liability Team 13: Case study on accounting fraud or scandal

10/28 MIn Class negotiation exercise

Details will be posted on Blackboard

10/30 W

11/4 M Chapter 50: Insurance

11/6 W Chapter 36: Corporate Formation and Financing Team 14: Where to incorporate

11/11 M Corporate Formation and Financing (cont.) Team 15: Ethics case study

11/13 WChapter 37: Corporate Governance and the Sarbanes-

Oxley ActTeam 16: Corporate governance

11/18 MChapter 38: Corporate Acquisitions and Multinational

Corporations

Negotiation Paper Due

Team 17: Case study example of litigation against

directors or majority shareholders

11/20 WChapter 41: Investor Protection, E-Securities, and Wall

Street ReformTeam 18: IPOs

11/25 M Investor Protection, E-Securities, and Wall

Street Reform (cont.)Team 19: Securities arbitration

11/27 W

12/2 M Chapter 46: Antitrust Law and Unfair Trade Practices

12/4 W Antitrust Law and Unfair Trade Practices

(cont.)

12/13 F

Midterm #2

FINAL EXAM

~ Thanksgiving Break ~

COURSE READINGS/CLASS SESSIONS

Fall 2013

~ Labor Day ~

Midterm #1