Faculty of Economics and Business
Universitas Gadjah Mada
Financial Statement Analysis
Spring 2008
Instructor:
E-mail:
Office:
Phone:
Office hours:
Setiyono Miharjo
setiyono@mmugm.ac.id
MMUGM Building 5th floor
0274-556912, 515536, 562222, 589384, 511036, ext.
129
W 12.10-13.00 or by appointment
Text: Financial Statement Analysis, 9th Edition, J.J.
Subramanyam, R.F. Halsey, McGraw Hill. ISBN 007-12441-2.
Wild,
K.R.
Course Objectives: To understand the role of financial statement analysis in
the broader field of business analysis. To learn how to use financial statement
to evaluate the company’s prospects and risks for the purpose of making
business decisions. By the end of the semester, students should be able to
understand:
ƒ The component of business analysis
ƒ The component process—accounting, financial, and prospective analyses
ƒ The use of financial statement analysis in different types of business
analysis
Organization of course:
Catch a fish for a man and he is fed for a day. Teach a man to fish and he is fed for
life. (Chinese Proverb)
The students have to read the chapters. I will discuss the chapters briefly in the
class, provide examples, and review the assigned exercises and problems.
Please feel free to ask questions in class. The material is cumulative and the
problems will compound. If you are having problem, do not let them continue.
I am available to the students.
Class etiquette: All of us are expected to be in class on time and ready to
participate. In the unusual case that you are late, please enter with the
minimum amount of disruption. We have too many important tasks to
accomplish and late arrivals are disruptive and inconsiderate.
If you need to leave early, please try to let me know before the class begins.
Unless there is a medical reason or an emergency, none of us is allowed to
leave for reasons, such as to get a drink of water or to take a break.
Food and beverages are permitted in class only as long as we keep the room
clean.
Good manners and politeness require that we listen to and respect each others'
questions and ideas. Private conversations are at best distracting.
Class Participation
I encourage active student participation in class. I should point out that
typically most students tend to underestimate, rather than overestimate, the
value of what they have to say. Thus, if you are ever in doubt, I encourage
you to speak up.
Clearly, you must participate in class if you are going to share your ideas
with others. There is no need to contribute in every class. Some of the best
contributors in the past have been those who participated in only a few
sessions. Their contributions, however, were truly insightful and persuasive.
The issue is one of quality, not quantity or frequency.
Below is a description of how I propose to "calibrate" your class
contributions:
Outstanding Contributor: Contributions in class reflect exceptional
preparation. Ideas offered are always substantive and provide one or more
major insights as well as direction for the class. Arguments, when offered,
are well substantiated and persuasively presented. If this person were not a
member of the class, the quality of the discussions would be diminished
significantly.
Good Contributor: Contributions in class reflect thorough preparation.
Ideas offered are usually substantive and provide good insights and
sometimes direction for the class. Arguments, when presented, generally are
well substantiated and often are persuasive. If this person were not a
member of the class, the quality of the discussions would be diminished
considerably.
Adequate Contributor: Contributions in class reflect satisfactory
preparation. Ideas offered are sometimes substantive and provide generally
useful insights but seldom offer a major new direction for discussion.
Arguments, which are presented sometimes, are fairly well substantiated
and sometimes persuasive. If this person were not a member of the class,
the quality of the discussions would be diminished somewhat.
Non-participant: This person has said little or nothing in class to date.
Hence, there is inadequate basis for evaluation. If this person were not a
member of the class, the quality of the discussions would not be changed.
Unsatisfactory Contributor: Contribution in class reflects inadequate
preparation. Ideas offered are seldom substantive; provide few, if any,
insights; and never offer a constructive direction for the class. Integrative
comments and effective arguments are absent. Class contributions are, at
best, "cherry-picking" efforts, making isolated, obvious, or confusing points.
If this person were not a member of the class, valuable airtime would be
saved.
Cold Calls
As a matter of policy, I do not use cold calls. I know you will be well
prepared for class. If it is needed, I will use cold calls to motivate you to do
the class assignments. If you want to participate, please raise your hand.
You can also contact me outside of the class if you have special needs. I do
grade class participation.
Additional Guidelines
Attendance is obviously important; scheduling of other activities should
avoid conflict with class meetings.
Classes will begin and end on time. I appreciate your presence in the
classroom before the class starts.
Please bring your name cards to class.
Homework problems: Doing homework is essential to understand the topics.
Homework problems are also very important since exams will be based upon
these, the class lectures and the class examples. You are expected to be
prepared to explain your solutions. Most homework problems will be collected
and evaluated, based on whether your effort is acceptable (indicated by a
checkmark) or not (a question mark). The assignments are due on the date
indicated. Late or partial assignment will not be collected or graded. Note:
copying and submitting the class solutions is absolutely unacceptable. I will
treat it as a form of plagiarism. Most problems must be prepared using
spreadsheet technology (e.g., excel).
Cases: There will be cases assigned throughout the semester. These cases will
help you understand the (ethical) pressures managers face in using accounting
information and in dealing with these pressures. There is no single right
answer to each question, so your justification is very important. Microsoft word
processing is required.
Project: Will be graded based on accuracy and completeness. Late project will
not be accepted. A separate set of instructions will be provided.
Make-up exams will not be given. If you are excused from an exam, a special
final exam will be required. It will cover the missed material. Generally, no
excuses will be accepted after the scheduled exam time. A grade of 0 will be
assigned for unexcused absences.
Grading:
Midterm Exams
Final Exam
Cases
Project
30%
30%
20%
20%
Total Available
100%
A > 92; A- 92-90; B+ 89-87; B 86-83; B- 82-80; C+ 79-77; C 76-73; C- 7270; D+ 69-67; D 66-60; F <60
Incomplete policy: It is policy of the Accounting Department that incompletes
will only be given in the case where the student misses the final exam due to
illness or family emergency. The student must be passing the course when the
incomplete is assigned. All incompletes must be satisfied within one year or
earlier, at the instructor’s option.
Integrity Standards: The University Catalogue provides a description of what
is acceptable behavior. Violations (cheating or plagiarism) are unacceptable and
will be dealt with by the assignment of failing grades. Reputation is one of the
most important things that we possess. Please take all cautions to keep yours
unblemished.
Note: I reserve the right to change the content of the syllabus. However, any
changes will be announced in advance.
Session Topics
Ch.
Homework
Cases
1
2
3
4
5
6
7
8
9
10
11
12
13
14
Overview of Financial
Statement Analysis
Financial Reporting and
Analysis
Analyzing Financing
Activities
Analyzing Investing
Activities
Analyzing Investing
Activities: Intercorporate
Investment
Analyzing Operating
Actvities
MIDTERM EXAM
Cash Flow Analysis
ROI and Profitability
Analysis
Prospective Analysis
Credit Analysis
Equity Analysis and
Valuation
Project Presentation 1
Project Presentation 2
Project Presentation 3
FINAL EXAM
1
2
3
4
5
6
7
8
9
10
11