Wilfrid Laurier University School of Business and Economics MBA Program – Fall 2009 BU607 Accounting Course Objectives: The objective of this course is to expose all students to the fundamental skills required by managers. All managers need to analyze financial statements, use accounting information in both short-run and long-run decisions and understand the impact of management control systems on their organizations. The focus of the course is on the development of these skills within a general management perspective and not on technical accounting issues. Instructor: Lynn Carty P3066 (519) 884-0710 X4161 lcarty@wlu.ca Required Textbook: HSSTG: Horngren, Charles T., Gary L. Sundem, William O. Stratton, Howard D. Teall and George A. Gekas Management Accounting, Fifth Canadian Edition, Prentice-Hall, 2007, ISBN: 0132362686 SZB: Stanco, Brian B., Thomas L. Zeller and Tashia E. Batstone Introduction to the Corporate Annual Report, Canadian Edition, Wiley, 2005, ISBN: 0470836520 BU607 Case Package Evaluation: Midterm test Final Report Participation Group Projects: SZB Project Presentation and Report Company Project Presentation Company Project Report 35% 25% 15% 5% 5% 15% Students with disabilities or special needs are advised to contact Laurier’s Special Needs Office for information regarding its services and resources. Students are encouraged to review the Calendar for information regarding all services available on campus. 1 Midterm Exam The midterm exam will include all material covered up to and including week #9. All students must pass the midterm exam. For those who fail the midterm, additional assignments must be completed to the satisfaction of the instructor. Final Report The final report is an individual report of approximately six pages plus exhibits (approximately 5 pages of exhibits). The report is to deal with an issue that is of interest to you and that is relevant to the objectives of this course. Each student must submit a one-page summary of your report proposal to the professor for comment and approval. Participation Starting in week 3 your participation will be graded for each class. You will receive a grade of zero if you are absent and a grade of at least 70% if you attend. A grade of between 70% and 100% will be awarded based on the quantity and quality of participation. You are permitted to miss up to one class provided notice has been given to the Instructor. For any additional classes missed, the Instructor will assign additional work based on the material covered in the missed class and this work must be completed to the satisfaction of the Instructor. Group Project The class will be divided into approximately 10 groups. Each group will select a company to study. The same company will be used for both the SZB Project and for the Company Project. The company will need to be registered (see Company Project). SZB Project As a group you are to systematically evaluate a company’s annual report and to gather information needed for making the business decision: Is this company a potential employer? To answer this question each group must answer the questions in the SZB booklet. The SZB booklet will be handed-in (one per group). The group will also prepare a presentation outlining: 1) your information needs for making the decision, 2) the company’s identified strategic focus, 3) the company’s financial health and 4) your decision based on your analysis. One class has been reserved for the presentations. The length of the presentations will depend on the number of groups. Each group must submit a copy of the PowerPoint slides used for the presentation before the presentation (print in grayscale with six to a page). Company Project – Saturday November 21 The Company project is completed along with Laurier’s Toronto MBA students and fulltime Waterloo MBA students. The project involves the analysis of a public company from the point of view of a prospective equity investor. The goal is to provide and justify an investment recommendation: buy, sell or hold. There will be a separate hand-out describing the Company Project. 2 Week 1: September 17 Preparing the Financial Statements Assignment: Baron Coburg Readings: HSSTG Chapters 1 & 15 SZB Chapters 1 & 2 Week 2: September 24 Financial Statement Analysis Assignment: Unidentified Industries (HSSTG Case 15-2 page 809) Benchmark Comparisons of the Wood Roof Truss Manufacturing Industry (case package) Readings: SZB Chapters 3, 4, 5 Week 3: October 1 Cash Flow, Proforma Analysis & Absorption Method Assignment: Wilson Lumber (case package) Discuss: Group Project Week 4: October 8 Contribution Margin Method Assignment: Peanuts (HSSTG Case 5-4 page 245) Readings: HSSTG Chapters 2, 3, 4 & 5 Week 5: October 15 Cost Determination Assignment: Protect-A-Plate (case package) Discuss: Group Project Issues Week 6: October 22 Relevant Information Assignment: Le Centre Sheraton (HSSTG Case 9-3 page 447) Readings: HSSTG Chapters 8 & 9 Week 7: October 29 Stanko, Zeller, Batstone (SZB) Presentations 3 Week 8: November 5 Budgeting and Performance Reporting Assignment: Holcomb Hotel (HSSTG Case 12-3 page 631) Readings: HSSTG Chapters 11 & 12 Discuss: Group Project Issues Week 9: November 12 Pricing and Utilization of Excess Capacity Assignment: Eastclock (HSSTG Case 5-3 page 243) Baldwin Bicycle (case package) Week 10: November 19 (class moved to Saturday November 21) COMPANY PROJECT Week 11: November 26 MIDTERM TEST (in class) Week 12: December 3 Risk Management: Accounting Fraud Video: How to Steal $500 Million Readings: How Are Earnings Managed? (case package) Week 13: December 10 Final Report Due Management Control Assignment: Shuman Automobile (case package) Durst Industries Inc. (HSSTG Case 14-6 page 753) Readings: HSSTG Chapter 13 & 14 4