The Financial Accounting course focuses at first on how to record economic events in the accounting records (i.e., bookkeeping and accrual accounting) and how to prepare and interpret the primary financial statements that summarize a firm's economic transactions. The course presents the basic concepts and structure of financial statements and the significance and inter-relation between their different components (Balance sheet, income statement, statement of cash flow), clarifying the underlying principles and procedures they are built with. Tools will be provided for reading and analyzing financial statements, with a particular focus on profitability ratios (ROE, ROI, ROS, and CT) to measure a company’s financial performance.

The purpose of this course is not to train you to become an accountant but to enable you to become an informed user of financial statements, with a view to understanding their implications for the future earnings potential of a firm. Students who successfully complete the course should be able to: (i) understand how accountants record the effects of specific transactions; (ii) understand the fundamental components of financial reports; (iii) interpret annual report information so as to analyze a company’s performance; and (iv) begin to learn the financial language of business. As a result you will be able to:

·         Prepare financial statements in accordance with Generally Accepted Accounting Principles

·         Use critical thinking to read financial statements

·         Employ different tools in order to analyse financial data

·         Understand the impact of different financial accounting methods on the financial statement.

·         Use financial accounting data to evaluate the company performance and, consequently, take business decisions focused on performance improvement

No more than three absences are allowed.

Please refer to the university catalog for the attendance and absence policy.

 ATTENDANCE REQUIREMENTS AND EXAMINATION POLICY

 You cannot make-up a major exam (midterm or final) without the permission of the Dean’s Office. The Dean’s Office will grant such permission only when the absence was caused by a serious impediment, such as a documented illness, hospitalization or death in the immediate family (in which you must attend the funeral) or other situations of similar gravity. Absences due to other meaningful conflicts, such as job interviews, family celebrations, travel difficulties, student misunderstandings or personal convenience, will not be excused. Students who will be absent from a major exam must notify the Dean’s Office prior to that exam. Absences from class due to the observance of a religious holiday will normally be excused. Individual students who will have to miss class to observe a religious holiday should notify the instructor by the end of the Add/Drop period to make prior arrangements for making up any work that will be missed. The final exam period runs until ____________

MAIN TOPICS COVERED IN THE COURSE SCHEDULE

• Introduction to financial accounting
• Overview of the different financial accounting systems
• Introduction to Financial Statements: Balance Sheet, Income Statement and Statement of Cash Flows and their contents including

(i)     Financial Assets
(ii)    Inventories
(iii)   Tangible Assets
(iv)   Intangible Assets
(v)    Liabilities
(vi)   Shareholders’ Equity
(vii)  Revenues and expenses

·         Accounting principles and procedures

• The accounting process: from Double Entry Accounting System to the Financial Statement document

·         Recording business transactions of the business management cycle in the financial statements (financing operations, purchases of inputs and sales of products/services)

·         Inventory evaluation methods

• Financial Statement Analysis (main profitability indicators)

An updated course schedule will be provided at the beginning of the course.