EASTERN MENNONITE UNIVERSITY
OLS 540 - Managerial Finance and Accounting I
Ronald L. Stoltzfus PhD, CPA
Spring 2014
Office Hours: WF 3:40 – 5:00 pm
and by appointment
Office: CC 214
Phone: (540) 432-4155
email: stoltzfr@emu.edu
COURSE DESCRIPTION:
Managers and executives carry fiduciary responsibility for their organizations; it is therefore imperative
that they know how to read financial statements, analyze financial health, assess financial risks, and
communicate this knowledge effectively to others. The course emphasizes the role of the manager
relating to finance and accounting through the analysis of quantitative information largely at the
conceptual level. Topics include financial governance, understanding and reading financial statements,
financial statement analysis, cost behavior, breakeven analysis, budgeting, balanced scorecard, working
capital management, and the use of short-term cash planning. The overall aim is to improve
organizational decision-making based on financial, social, and ecological metrics.
TEXTS:
Stephen A. Ross, Westerfield, Randolph W., Jaffe, Jeffrey F., & Jordan, Bradford D. Corporate Finance:
Core Principles and Applications, 3rd Ed., McGrawHill/Irwin, 2011.
Edward J. Blocher, Stout, David E., & Cokins, Gary. Cost Management: A Strategic Emphasis. 5th Ed.,
McGrawHill/Irwin 2010.
Thomas A. McLaughlin. Financial Basics for Nonprofit Managers. 3rd Ed., Wiley, 2009.
(For those with a Nonprofit emphasis)
COURSE OBJECTIVES:
This course’s primary objective focuses on enabling you to make effective use of data within your own
organization or business practice. As such, you will develop the analytical skills necessary to diagnose
complex business problems using finance and accounting data.
By the end of the course, students will:
 Become familiar with agency theory,
 Read and analyze financial statements,
 Understand cost behaviors, cost accumulation, and cost-volume-profit analysis,
 Understand budgets and build cash budgets,
 Construct a strategy map and balanced scorecard for an organization or business segment,
 Analyze relevant costs, and
 Understand the principles of performance measurement.
TEACHING/LEARNING METHODS:
The course attempts to use various teaching and learning styles to accomplish the above objectives. I
believe you cannot learn finance and accounting concepts simply by reading. The course includes:
 Reading the textbook, articles, cases, etc. that explain the concepts
 Analyze and discuss cases studies and offer solutions to the current situation
 Lectures and class discussions about concepts in the course
 Videos, clips, and other sources in information pertinent to the topic
 Various problem solving exercises
 Presentations and discussions
ACADEMIC INTEGRITY POLICY (AIP):
EMU faculty care about the integrity of their own work and the work of our students. They create
assignments that promote interpretative thinking and work intentionally with students during the learning
process. Honesty, trust, fairness, respect, and responsibility are characteristics of a community that is
active in loving mercy, doing justice, and walking humbly before God. EMU defines plagiarism as occurring
when a person presents as one’s own someone else’s language, ideas, or other original (not commonknowledge) material without acknowledging its source (Adapted from the Council of Writing Program
Administrators). Taken from "Academic Integrity" in the 2013-2014 Undergraduate Catalog, pp. 16-19.
Personal integrity and mutual trust are essential to the learning community. I expect students to uphold
high standards of personal ethics, including the professional ethics associated with academic life. EMU
considers a student's lying, cheating, or stealing through the wrongful use or inappropriate attribution of
information on tests, term papers, or other academic assignments to be a serious violation of the
standards of integrity in the academic community.
DISABILITIES:
If you have a physical, psychological, medical, or learning disability that may impact your work in this
course, it is your responsibility to contact Student Disability Support Services on the third floor of the
Hartzler library. They will work with you to establish eligibility and to coordinate reasonable
accommodations. All information and documentation is treated confidentially.
http://www.emu.edu/academic-support/disabilities/
ACCELERATED COURSE:
The EMU MBA program delivers the course content in an accelerated format. Consequently, you are
required to do more work out of the classroom than the traditional delivery format. My charge from the
State Council of Higher Education is to make this course equivalent to a traditional MBA course that meets
three hours each week. Consequently, more of the responsibility for learning the concepts presented in
the textbook falls on your shoulders. I encourage web-based discussions to share questions and solutions
on homework questions.
ASSESSMENT:
Your final grade is determined on the basis of your performance in the following categories:
10% Class Participation
15% Financial Statement Analysis
15% Book Critique
20% Case Study & Presentation
40% 4 Cases
100% TOTAL
A
93 – 100%
B
83 – 86%
C
73 – 76%
A90 – 92%
B80 – 82%
C70 – 72%
B+
87 – 89%
C+
77 – 79%
F
Below 70%
Class Participation & Professionalism (10%):
You are expected to contribute actively to the class discussion during regular sessions related to textbook
chapters, homework questions, supplemental readings as well as case discussions. 10% of your grade may
be earned by effective participation in the classroom and successful case openings. Mere attendance
earns no participation points. Please ask questions to enhance your understanding of the topics. Also
discuss relevant examples from your own work experience.
Financial Statement Analysis (15%)
You will perform a financial statement analysis on a company of your choice and suggest any troublesome
areas. You should offer suggestions for improving the financial condition of your chosen organization.
Book Critique (15%):
The book critique provides an opportunity for you to explore in greater depth a topic area of interest with
respect to finance and accounting. I will need to approve your book choice.
Case Study (20%)
The final assignment in the course will be a paper/project of significant length and design to bridge theory,
skills, and practice. The project requires you to find a real-world case where organizational decline came
from finance and/or accounting failures. You will write the story and analyze the cause and effect and
lessons learned based on the course material. The paper is due the last day of class and we will present
our work projects the last two classes (about 10 minutes each).
Cases (40%):
You are required to submit individual case reports of equal weight. You must include an executive
summary of your case analysis. You must submit your case on or before the designated due dates at the
beginning of class. The prior week I will introduce the case and may provide a handout for the
requirements of the case. You should approach the collected cases as a consultant and deliver to your
client a report that addresses the issues. The audience in your paper is your boss who probably knows the
issue(s) well but may not have a thorough understanding of the solution. That is, make sure you explain
your work.
Preparation of Cases
Cases are longer than homework questions and most have more than one solution. Cases require the
reader to make interpretations of factual matters, and these interpretations will differ from reader to
reader. Furthermore, cases require the reader to make judgments on issues that may be a source of unreconciled differences between readers. One of the benefits of case work is that it prepares us for a world
in which different interpretations and judgments are the rule rather than the exception. Accordingly,
cases should be viewed as vehicles for discussion rather than problems for solution. I recommend the
following procedure in preparing a case for class:
1. Read the case quickly (invest no more than a few minutes in this initial reading) and note the study
questions (if any) at the end of the case.
2. Read the assigned chapter or article(s) making brief written notes of ideas and issues related to the
case. These notes should be brought to class and can serve as a basis for your participation in
discussion. (Some students find that it’s easier to perform the first two steps in the reading procedure
a day or so before the last two steps.)
3. Read the case carefully; as you read extend and embellish your notes.
4. Prepare the writing assignment, including an executive summary.
Tentative Schedule of Topics
Jan 9 - Week 1
Introduction and Governance
 Read governance article (select the appropriate article below)
 A Theory of Corporate Governance by John Carver
http://www.carvergovernance.com/pg-corp.htm
 Carver’s Policy Governance Model in Nonprofit Organizations
http://www.carvergovernance.com/pg-np.htm
• Skim Chapter 1 (RWJJ) – Intro to Corporate Finance
Jan 16 - Week 2 (on-line)
Understanding Financial Statements
• Read ‘Reading & Understanding Financial Statements’ at link below
http://www.svdpusa.org/LinkClick.aspx?fileticket=YzxFYIPmdpA%3D&tabid=263
 Read Chapters 1&2 McLaughlin (for Nonprofits)
 Read Chapter 2 (RWJJ)
• Select a company/organization for your financial statement analysis project
Jan 23 – Week 3
Financial Statement Analysis
 Read Chapter 3 (RWJJ) (Omit sections 3.4, 3.5, and 3.6)
 Read Chapter 3, 5, 6, & 7 McLaughlin (for Nonprofits)
Jan 30 – Week 4 (on-line)
Intro to Management Accounting
 Financial Statement Analysis Project Due
 Read Chapters 1 & 2 (BSC)
Feb 6 – Week 5
Strategy Maps and Balanced Scorecards
 Article Readings
Feb 13 – Week 6 (on-line)
Cost Behavior
 Balanced Scorecard Case/Project Due
 Read Chapter 3 (BSC)
Feb 20 – Week 7
Job Costing (Cost Accumulation for Deliverables)
 Read Chapter 4 (BSC)
 Read Chapter 8 McLaughlin (for Nonprofits)
Feb 27 – Week 8 (on-line)
 Book Report Due
 Read Chapter 8 (BSC)
Mar 6 – Spring Break
Cost Estimation
take-home project
Mar 13 – Week 9
Profit Planning: Cost-Volume-Profit
 Case Due
 Read Chapter 9 (BSC)
Mar 20 – Week 10 (on-line)
Strategy and Master Budget
 Read Chapter 10 (BSC)
Mar 27 – Week 11
Budgeting
 Budget Readings
Apr 3 – Week 12 (on-line)
Operational Performance Measurement
 Case Due
 Read Chapter 14 (BSC)
Apr 10 – Week 13
Strategic Performance Measurement
 Read Chapter 18 and up to p 859 of Chapter 19 (BSC)
Apr 17 – Week 14 (on-line)
Case Study Presentations
Apr 30 – Week 15
Case Study Presentations
 Book Report Due