Financial Reporting and Analysis

Aims

The aim of this course is to provide a good understanding of accounting principles and practices of financial accounting. Users of financial data should be in position to understand the foundations of the key financial statements and the fundamental limitations of accounting data. Analysis of financial data is an everyday tool to managers, financial analysts and many market participants. The purpose of this course is to give you the foundation for such analysis. Therefore on completion of this course you should be able to understand key financial statements, including cash flow statement. You should be able to evaluate the financial performance, financial position and financial adaptability of a general purpose company. Developing expertise in financial accounting and analysis requires a significant amount of practice. We will look at “textbook” cases as well as at financial statements of real companies. Preparation for lectures may involve reading the assigned materials and working through a case or problem and answering the questions set.

Learning Outcomes

On completion of the course students will be able to:

• Read and understand key financial statements.
• Construct a basic set of financial statements.
• Critically evaluate some of the accounting decisions that have gone into the preparation of these statements.
• Evaluate company performance using a set of financial statements.
• Use accounting data for management planning and decision making.

Content

• Uses and users of accounting information.
• Overview of main accounting statements.
• Preparing financial statements.
• Accounting for groups of companies.
• Intangible assets.
• Cash flow statements.
• Financial statement analysis.
• Understanding cost behaviour. Cost-volume-profit analysis.
• Budgeting.
• Divisional performance measurement.