Analysis of Financial Statements

Course aim

This unit helps students to develop an understanding of the techniques of financial statement analysis in various contexts, for example: equity investment; credit evaluation; risk analysis; prediction of corporate failure; analysis of supplier/customer health; competitor analysis; regulatory overview or intervention; and valuation for takeover/restructuring. A primary purpose of this unit is to develop an understanding of these techniques, as well as the inherent difficulties in their application. Topics covered include analysis of business performance and disclosure, the analysis of earnings quality, cash flow assessment, credit worthiness and accounting-based valuation methods.

Course content

Business Strategy Analysis, Strategy Analysis, Accounting Analysis, Earnings and Balance Sheet Management, Financial Ratio Analysis, Prospective Analysis, Valuation Theory & Issues – Cash Flows, Valuation Theory & Issues – Accrual Measures, Security Analysis, Credit Analysis, Credit Analysis (Advanced Topics), Takeovers, Financial Policy.

Textbook(s)

Palepu, K G, Healy, P M, Bernard, V L, Wright, S, Bradbury, M & Lee, P 2015, Business analysis and valuation: using financial statements, 2nd edn, Cengage Australia, South Melbourne

Prerequisite(s)

Corequisite(s)

Nil

Teaching method

Note: These components may or may not be scheduled in every study period. Please refer to the timetable for further details.

Assessment

Continuous assessment, Examination, Report

Fees

EFTSL*: 0.125
Commonwealth Supported program (Band 3)
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Fee-paying program for domestic and international students
International students and students undertaking this course as part of a postgraduate fee paying program must refer to the relevant program home page to determine the cost for undertaking this course.

Non-award enrolment
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* Equivalent Full Time Study Load. Please note: all EFTSL values are published and calculated at ten decimal places. Values are displayed to three decimal places for ease of interpretation.