Understanding how to read, interpret, and analyze financial statements is an essential skill for any financial professional. This course describes in clear, concise language the intricacies of financial statements and their use by investors, creditors, analysts, and other interested parties. In understanding these concepts, you will enhance your chance for success in business and investing by enabling you to profit from the knowledge, insights, and perceptions of professionals who use financial statement analysis tools and techniques on a day-to-day basis. Realistic examples and illustrations of financial statement analysis are widely used in this course to make the subject matter crystal clear.
Upon successful completion of this course, participants will be able to:
- State the objectives of financial reporting.
- Recognize the qualitative characteristics of accounting information.
- Recognize the basic assumptions of accounting.
- Identify the basic principles of accounting.
- Recognize the basic financial statements: the balance sheet, income statement, and statement of cash flows.
- Identify the key balance sheet items portraying a company's financial position.
- Recognize the most important items on the statement of cash flows.
- Identify the annual report components, including the financial statements, footnotes, review of operations, auditor's report, and supplementary schedules
- Assess a company's cash inflows and cash outflows.
- Recognize the important aspects of financial statement analysis.
- Compare horizontal analysis with vertical analysis.
- Identify the basic components of ratio analysis.
- Identify the limitations of ratio analysis.
- Recognize different liquidity ratios and how they can be used to compare companies.
- Compute and interpret liquidity ratios used to analyze a company’s ability to pay debt.
- Compute and interpret activity ratios.
- Recognize how inventory and receivable factors will affect business analysis and comparisons.
- Identify different structure ratios used to analyze the capital structure of a company.
- Recognize operating leverage and financial leverage.
- Recognize how financing, debt, and interest affect company analysis and performance.
- Recognize and apply key ratios related to profitability.
- Identify how to compute return on investment (ROI), and how to enhance ROI.
- Recognize how return on assets can be used to assess management performance.
- Recognize a wide range of market test ratios used to measure market strength of a company.
- Recognize how market test ratios evaluate a company’s financial performance.
- Recognize the key items on the statement of cash flows to analyze company performance.
- Identify and apply the major ratios used to evaluate the cash flow of a company.
- Recognize the accounting associated with interim reporting.
- Identify the disclosure requirements for major segments of a business.
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