DAC 511 : CORPORATE FINANCIAL REPORTING AND ANALYSIS

DAC 511 : CORPORATE FINANCIAL REPORTING AND ANALYSIS BY H O ONDIGO UNIVERSITY OF NAIROBI SCHOOL OF BUSINESS MAY 2012

COURSE OUTLINE • COURSE TITLE: FINANCIAL REPORTING AND ANALYSIS.COURSE CODE: DAC 511 • LECTURERS: MR. HERICK ONDIGO • SEMESTER:MAY- AUGUST 2012

COURSE OBJECTIVES: To Expose the learner into the role of corporate financial Reporting in the economic decision making process and equip the learner with the tools and methods used in the analysis financial reports by management investors and other interested external users.

COURSE TEXT • Wild J.J., K.R Subranyam and R.B.Hasley., Financial Statement Analysis, McGraw-Hill 9th, Edition, 2007

OTHER READING MATERIAL • White, G.I, A.A Sondi, and D. Fried., The Analysis and use of Financial Statements, 3rd Edition John Wiley and Sons, 2003 • Revsine, L., Collins, D.W and Johnson, W.B., Financial Reporting and Analysis ,3rd Edition ,Prentice Hall,2005

OTHER READING MATERIAL CONT… • Stickney, Brown and Wahlen., Financial Reporting and Statement Analysis ,5th edition ,Thomson Southwestern ,2004 • Gibson Charles, Financial Reporting and Analysis using financial Accounting Information, South-Western Cengage Learning ,11th Edition, 2009. • Dunn John, Financial Reporting and Analysis, John Wiley and Sons ,2009

OTHER READING MATERIAL CONT… • Friedlob T George & L. F Schleifer., Essential of Financial Analysis ,John Wiley and Sons ,2009 • Comiskey E Eugene & C. W Mulford.,

METHODOLOGY The course will be conducted mainly by way of lectures, presentations and class discussions. Students are advised to read the relevant texts before lessons are covered in class. Assignments 20% Tests 30% Final Examination 50% Total Mark100%

EVALUATION • Assignments 10% • Term Paper 10% • Class Presentations 10% • Tests 20 % • Final Examination 50% • Total Mark100%

TOPICS1: Overview of Financial Analysis • Business analysis • Financial Statements – The Basis of Analysis • Financial Statement Analysis

2. Financial Reporting and Analysis • Reporting Environment • Nature and Purpose of Financial Accounting • Accruals- Cornerstone of Accounting • Introduction to Accounting Analysis

3.Analyzing Financing Activities Liabilities Leases Post Retirement Benefits Contingencies Off Balance sheet Financing Shareholders’ Equity

4. Analyzing Investing Activities Current assets Long-term assets Plant assets and Natural Resource Intangible Assets

5. Analyzing Inter Corporate Investments • Investment Securities • Business combinations • Derivative Securities

6. Analyzing Operating Activities • Income Measurement • Non-Recurring Items • Revenues and Gain Recognition • Supplementary Employee Benefits • Income Taxes

7. Cash Flow Analysis Statement of Cash flows Analysis and Implication of Cash Flows Analysis of Cash Flows Specialized Cash flow Ratios

8. Return on Invested Capital and Profitability Analysis Importance of Return on Invested Capital Components of Return on invested Capital Analyzing Return on Net Operating Assets Analyzing Return on Common Equity

9. Prospective Analysis The Projection Process Projecting Financial Statements Application of Prospective Analysis in the Residual Income Valuation Model Trends in Value Drivers

10. Credit Analysis Liquidity and Working Capital Operating analysis of Liquidity Additional Liquidity Measures

11. Capital Structure and Solvency Analysis • Basics of Solvency • Capital Structure Composition and Solvency • Earnings Coverage

12: Equity Analysis and Valuations Earnings Persistence Earnings Based Equity Earnings Power and Forecasting

THE END • BEST OF LUCK IN THE COURSE

DAC 511 : CORPORATE FINANCIAL REPORTING AND ANALYSIS