Postgraduate Course: Financial Statement Analysis (CMSE11338)
Course Outline
| School | Business School |
College | College of Humanities and Social Science |
| Credit level (Normal year taken) | SCQF Level 11 (Postgraduate) |
Availability | Not available to visiting students |
| SCQF Credits | 15 |
ECTS Credits | 7.5 |
| Summary | The course aims to allow participants to analyse financial statements of corporations from around the world and to show the links between accounting statements, valuation methods and investment analysis. |
| Course description |
Students will learn to extract information and meaning from IFRS compliant statutory financial statements. They will be able to calculate and use accounting ratios, extracting information to make forecasts and valuations. Students will be able to conduct a limited analysis of corporate strategy and link this to the company's financial performance. Students will also gain understanding of the limitations of financial statements and the methods for evaluating the quality of these statements.
Syllabus:
Introduction: The principal financial statements
Understanding company behaviour: strategies and business models
Using accounting ratios: a critical perspective
The use of non-profit based performance indicators
Financial Modelling; Conducting an analysis
Understanding group accounting
Equity valuation: methods and critique
Introducing accounting regulation and the framework statement
Fair value and impairment
Cosmetic accounting
Student Learning Experience
Learning will primarily be through reading, thinking , class discussion, attending lectures and working as groups on presentation material. Accounting concepts can take time to absorb and student should expect to have to invest time prior to lectures (and prior to the beginning of lectures for those with no or little prior knowledge in accounting) in order to fully understand and participate in class discussions. Supplementary exercises and solutions will be also provided for some topics.
The group-work assignment provides a different type of learning experience. It is a practical project which requires teamwork. The assignment simulates the approach in investment research where teamwork and individual skill sets need to be directed and managed to achieve deadlines. As in investment research, teams are rewarded and judged based on coordinated team outputs, creativity and the manner of client interaction - in this case simulated by a class presentation and questions.
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Entry Requirements (not applicable to Visiting Students)
| Pre-requisites |
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Co-requisites | |
| Prohibited Combinations | |
Other requirements | For Business School PG students only, or by special permission of the School. Please contact the course secretary. |
Course Delivery Information
| Not being delivered |
Learning Outcomes
On completion of this course, the student will be able to:
- Understand and critically evaluate the construction of corporate financial accounting statements.
- Undertake analysis of corporate value and evaluation of company health and opportunity.
- Explain and discuss value creation and the creation of residual income.
- Critically evaluate current capital market research into accounting.
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Reading List
Alexander, Britton, Jorissen, Hoogendoom and Van Mourik (2014), International Financial
Reporting and Analysis, 6th Edition, Cengage Learning.
OR (an alternative book): Melville, A., (2013), International Financial Reporting: A Practical
Guide, 4th edition, Pearson.
Recommended Background Reading
Kay, John, (2009) The Long and the Short of it: a guide to the finance and investment for normally intelligent people who aren¿t in the industry, The Erasmus Press Ltd.
Students should try to read the Financial Times on a regular basis.
In-course reading will be indicated during classes. |
Additional Information
| Graduate Attributes and Skills |
Cognitive Skills:
The course will develop analytical, numerical and problem-solving skills as well as communication and working with others
Subject Specific Skills
Financial analysis skills;
financial modelling skills;
understanding the business and marketplace context;
the "3 lines" method of strategic analysis. |
| Keywords | Not entered |
Contacts
| Course organiser | |
Course secretary | Miss Rachel Allan
Tel: (0131 6)51 3757
Email: |
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