Financial Statement Analysis
- The goal of this course is to equip students with the skills needed to perform financial analysis and interpret financial statements properly.
- Work effectively in a team environment.
- Use good analytical skills and apply them to solve practical problems.
- Evaluate the impact of financial reporting choices on the quality of accounting information including reported earnings.
- Apply a set of diagnostics to assess the quality of the accounting in financial statements.
- Demonstrate deep knowledge and critical understanding of theories, principles, concepts and methodologies in financial statement analysis.
- Have basic practical skills in financial statement analysis and interpreting financial information.
- Understand the essence of financial terms and to use them properly.
- Have an idea about the place and the role of financial analysis in the system of management of the economic entity.
- Topic 1. Overview of Financial Statement AnalysisTypes and Components of Business Analysis. Financial Statements- Basis of Analysis. The Annual Report. Comparative Financial Statement Analysis. Ratio Analysis.
- Topic 2. Financial Reporting and AnalysisFinancial Reporting Environment. Concept of Income. Fair Value Accounting. Earnings Management.
- Topic 3. Return on Invested Capital and Profitability AnalysisImportance of Return on Invested Capital. Components of Return on Invested Capital. Analyzing Return on Net Operating Assets. Analyzing Return on Common Equity.
- Topic 4. Credit AnalysisLiquidity and Working Capital. Additional Liquidity Measures. Importance of Capital Structure. Capital Structure Composition and Solvency. Earnings Coverage. Capital Structure Risk and Return.
- Topic 5. Cash Flow AnalysisStatement of Cash Flows. Reporting Cash Flows from Operations. Analysis Implications of Cash Flows. Specialized Cash Flow Ratios.
- Topic 6. Prospective AnalysisProspective Analysis. The Projection Process. Short-term Forecasting.
- Midterm TestThe midterm test will take the form of a 2-hour (80 min) open book test: individual, online. The test consists of 40 questions and tasks of the topics: 1,2,3.
- Final TestThe final test will take the form of a 2-hour (80 min) open book test: individual, online. The test consists of 40 questions and tasks of the whole course content.
- Exam: Team ProjectIn small groups, written report, with follow-up online presentation, open book
- Interim assessment (3 module)0.4 * Exam: Team Project + 0.4 * Final Test + 0.2 * Midterm Test
- Financial statement analysis, Subramanyam, K.R., 2014
- Cope, A. T., & Robinson, T. R. (2015). International Financial Statement Analysis (Vol. Third edition). Hoboken, New Jersey: Wiley. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=946119