BY H O ONDIGO UNIVERSITY OF NAIROBI SCHOOL OF BUSINESS MAY 2012 DAC 511 : CORPORATE FINANCIAL REPORTING AND ANALYSIS

COURSE OUTLINE COURSE TITLE : FINANCIAL REPORTING AND ANALYSIS. COURSE CODE: DAC 511 LECTURERS: MR. HERICK ONDIGO SEMESTER: MAY- AUGUST

COURSE OBJECTIVES: To Expose the learner into the role of corporate financial Reporting in the economic decision making process and equip the learner with the tools and methods used in the analysis financial reports by management investors and other interested external users. 1-3

COURSE TEXT Wild J.J., K.R Subranyam and R.B.Hasley., Financial Statement Analysis, McGraw-Hill 9 th, Edition,

OTHER READING MATERIAL White, G.I, A.A Sondi, and D. Fried., The Analysis and use of Financial Statements, 3 rd Edition John Wiley and Sons, 2003 Revsine, L., Collins, D.W and Johnson, W.B., Financial Reporting and Analysis, 3 rd Edition,Prentice Hall,

OTHER READING MATERIAL CONT… Stickney, Brown and Wahlen., Financial Reporting and Statement Analysis, 5 th edition,Thomson Southwestern,2004 Gibson Charles, Financial Reporting and Analysis using financial Accounting Information, South-Western Cengage Learning,11 th Edition, Dunn John, Financial Reporting and Analysis, John Wiley and Sons,

OTHER READING MATERIAL CONT… Friedlob T George & L. F Schleifer., Essential of Financial Analysis, John Wiley and Sons,2009 Comiskey E Eugene & C. W Mulford., 1-7

METHODOLOGY The course will be conducted mainly by way of lectures, presentations and class discussions. Students are advised to read the relevant texts before lessons are covered in class. Assignments 20% Tests 30% Final Examination 50% Total Mark 100% 1-8

EVALUATION Assignments 10% Term Paper 10% Class Presentations 10% Tests 20 % Final Examination 50% Total Mark 100% 1-9

TOPICS1: Overview of Financial Analysis Business analysis Financial Statements – The Basis of Analysis Financial Statement Analysis 1-10

2.Financial Reporting and Analysis Reporting Environment Nature and Purpose of Financial Accounting Accruals- Cornerstone of Accounting Introduction to Accounting Analysis 1-11

3. Analyzing Financing Activities Liabilities Leases Post Retirement Benefits Contingencies Off Balance sheet Financing Shareholders’ Equity 1-12

4. Analyzing Investing Activities Current assets Long-term assets Plant assets and Natural Resource Intangible Assets 1-13

5. Analyzing Inter Corporate Investments Investment Securities Business combinations Derivative Securities 1-14

6. Analyzing Operating Activities Income Measurement Non-Recurring Items Revenues and Gain Recognition Supplementary Employee Benefits Income Taxes 1-15

7. Cash Flow Analysis Statement of Cash flows Analysis and Implication of Cash Flows Analysis of Cash Flows Specialized Cash flow Ratios 1-16

8. Return on Invested Capital and Profitability Analysis Importance of Return on Invested Capital Components of Return on invested Capital Analyzing Return on Net Operating Assets Analyzing Return on Common Equity 1-17

9. Prospective Analysis The Projection Process Projecting Financial Statements Application of Prospective Analysis in the Residual Income Valuation Model Trends in Value Drivers 1-18

10. Credit Analysis Liquidity and Working Capital Operating analysis of Liquidity Additional Liquidity Measures 1-19

11. Capital Structure and Solvency Analysis Basics of Solvency Capital Structure Composition and Solvency Earnings Coverage 1-20

12:Equity Analysis and Valuations Earnings Persistence Earnings Based Equity Earnings Power and Forecasting 1-21

THE END BEST OF LUCK IN THE COURSE 1-22