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Financial Accounting (M30296)

General information

Type:

OB

Curs:

1

Period:

S semester

ECTS Credits:

2 ECTS

Teaching Staff:

Group Teacher Department Language
Sec: A Josep Bisbe Viñas Economía, Finanzas y Contabilidad ENG

Group Teacher Department Language
Sec: B Santiago Simón del Burgo Economía, Finanzas y Contabilidad ENG
Sec: B Josep Bisbe Viñas Economía, Finanzas y Contabilidad ENG

Group Teacher Department Language
Sec: C Santiago Simón del Burgo Economía, Finanzas y Contabilidad ENG
Sec: C Josep Bisbe Viñas Economía, Finanzas y Contabilidad ENG

Course Learning Objectives

The purpose of this course is to provide MBA students with the key points to understand how financial accounting and reporting are used in business as inputs for decision-making. The concepts and topics covered in the course presume that participants have a thorough understanding of the material covered in foundations weeks. The knowledge acquired in foundations weeks about the features of and the interrelationships among the fundamental financial statements will be used in this course to better understand some of the most relevant regarding financial accounting and reporting. As it portrays the financial situation and performance of a company, financial accounting appeals to a wide audience including present and potential investors, creditors, government agencies and management. The course will develop the criteria, procedures and formats used to represent and report some of the most significant components of the financial statements (e.g. revenue recognition, cost of goods sold, operating assets, inter-corporate investments, capital sources), so that students are well equipped to properly interpret the meaning of the reported information and can subsequently engage in financial analysis.

The course aims to develop analytical skills so that participants are well equipped to:
- To analyze some of the most significant individual components of financial statements and the different ways in which they can be presented as well as to gain an appreciation for the impacts different accounting methods may have in this regard. Most of the issues discussed here are valid in most countries and in most sets of accounting standards. In those cases where particular concepts or practices covered here might vary from one country to another, we will take International Accounting Standards / International Financial Reporting Standards (IAS / IFRS) as the reference framework.
- To provide awareness regarding some common financial accounting and reporting misunderstandings and minefields.
- To extend the concepts and tools covered in foundations weeks in order to have an overview of the representation provided by consolidated financial statements (statements at group level), understanding the differences between individual financial statements (i.e. firms) and consolidated financial statements (i.e. corporations or groups).
- To provide a solid grounding for properly engaging in financial analysis (object of the subsequent Finance course)

CONTENT

1. Unit 1. Long-lived assets and depreciation

Categories of fixed or long-lived assets. Tangible and intangible fixed assets. Depreciation
and amortization: concept, meaning and misunderstandings. Depreciation methods.
Disposal of fixed assets. Revaluation of assets. Impairment of assets.
Readings: Stolowy, H., Lebas, M. and Ding, Y. (2010). Financial Accounting and Reporting: A Global
Perspective (3rd ed.). pp. 265-328
Sutton (2004). Corporate Financial Reporting, pp. 203-224.
Exercises: 1.1., 1.2., 1.3.
HOMEWORK #1 due Oct 14th

2. Unit 2. Revenues and Accounts Receivable

Revenue recognition. Measurement of revenues. Taxes on sales. Discounts and returns of
sales. Accounts receivable and bad debts.
Readings: Stolowy, H., Lebas, M. and Ding, Y. (2010). Financial Accounting and Reporting: A Global
Perspective (3rd ed.). pp. 224-231 & 379-392.
Case Study: Biovail
Exercises: 2.1., 2.2., 2.3.
HOMEWORK #2 due Oct 21st

3. Unit 3. Inventories and Cost of Goods Sold.

Merchandising vs. manufacturing inventories. Gross margin, cost of goods (COG) and
inventories. The impact of recognition and measurement of inventories on COG. Perpetual
and periodic inventory systems. Recording and measuring purchases. Accounting for VAT.
Discounts and returns of purchases. Inventory valuation methods: FIFO, LIFO and WAC.
Readings: Stolowy, H., Lebas, M. and Ding, Y. (2010). Financial Accounting and Reporting: A Global
Perspective (3rd ed.). pp. 338-359.
Pratt (2008). Financial Accounting in an Economic Context, pp. 274 - 296.
Exercises: 3.1., 3.2., 3.3.
HOMEWORK #3 due Nov 4th

4. Unit 4. Owners' equity

Reporting and analyzing owner financing. Accounting for contributed capital; including
stock sales, stock repurchases, and stock compensation plans. Accounting for earned
capital; including cash dividends, stock dividends, and comprehensive income.
Readings: Stolowy, H., Lebas, M. and Ding, Y. (2010). Financial Accounting and Reporting: A Global
Perspective (3rd ed.). pp. 405-441.
Case Study: Jimmy Fu and Moog, Inc.: Understanding Shareholders' Equity
Exercises: 4.1, 4.2, 4.3
HOMEWORK #4 due Nov 11th

5. Unit 5. Business combinations and consolidated financial statements.

Reporting and analyzing intercorporate investments. Accounting for equity investments
and consolidations. Acquisition method mechanics. Financial analysis of business
combinations.
Readings: Stolowy, H., Lebas, M. and Ding, Y. (2010). Financial Accounting and Reporting: A Global
Perspective (3rd ed.). pp. 503-533..
Case Study: The Talbot's Inc., and Subsidiaries: Accounting for Business Combinations
Exercises: 5.1; 5.2

Methodology

ASSESSMENT

ASSESSMENT BREAKDOWN

Description %
Individual-based 50
Group-based 40
Class participation 10

Assessment criteria

Assignments

You will find three types of assignments in the syllabus:

a) READINGS. You are expected to read these materials before the session they refer
to, so that they can be used as a basis for class discussion.

b) EXERCISES. These are problems which are useful to illustrate specific aspects of the
issues covered in the course. In most of the cases, solutions will be provided.

c) HOMEWORK PACKAGES. These are problem sets to be prepared in groups. . Homeworks will be graded.

Bibliography

Stolowy, H and Ding, Y. (2017). Financial Accounting and Reporting: A Global Perspective (5thd ed.). Cengage.
Weygandt, J.J., Kimmel,,P.D. and Kieso, D.E. (2015). Financial Accounting (IFRS edition). (3rd ed.). Wiley

Timetable and sections

Group Teacher Department
Sec: A Josep Bisbe Viñas Economía, Finanzas y Contabilidad

Timetable Sec: A

From 2017/10/10 to 2017/10/23:
From Monday to Tuesday from 14:30 to 18:00. (Except: 2017/10/16 and 2017/10/17)
Each Monday from 8:00 to 10:00. (Except: 2017/10/23)
Each Monday from 10:00 to 13:30. (Except: 2017/10/23)

From 2017/10/25 to 2017/11/3:
Each Thursday from 14:30 to 18:00. (Except: 2017/11/2)
Monday, Wednesday and Friday from 8:00 to 10:00. (Except: 2017/11/1 and 2017/11/3)
Each Friday from 10:00 to 13:30. (Except: 2017/10/27)

From 2017/11/7 to 2017/11/10:
Each Tuesday from 8:00 to 10:00.
Each Friday from 15:00 to 18:30.

Group Teacher Department
Sec: B Santiago Simón del Burgo Economía, Finanzas y Contabilidad
Sec: B Josep Bisbe Viñas Economía, Finanzas y Contabilidad

Timetable Sec: B

From 2017/10/13 to 2017/10/30:
Each Friday from 14:30 to 18:00. (Except: 2017/10/13 and 2017/10/27)
Monday and Wednesday from 8:00 to 10:00. (Except: 2017/10/18 and 2017/10/23)
Each Friday from 10:00 to 13:30. (Except: 2017/10/20)

From 2017/10/24 to 2017/11/7:
Each Tuesday from 14:30 to 18:00. (Except: 2017/11/7)
Tuesday and Friday from 8:00 to 10:00. (Except: 2017/10/24, 2017/10/31 and 2017/11/3)

Friday 2017/11/10 from 15:00 to 18:30.

Group Teacher Department
Sec: C Santiago Simón del Burgo Economía, Finanzas y Contabilidad
Sec: C Josep Bisbe Viñas Economía, Finanzas y Contabilidad

Timetable Sec: C

From 2017/10/13 to 2017/10/30:
Each Friday from 14:30 to 18:00. (Except: 2017/10/20)
Monday and Wednesday from 8:00 to 10:00. (Except: 2017/10/18 and 2017/10/23)
From Wednesday to Thursday from 10:00 to 13:30. (Except: 2017/10/18 and 2017/10/26)

From 2017/10/27 to 2017/11/7:
Tuesday and Friday from 8:00 to 10:00. (Except: 2017/10/31 and 2017/11/3)
Each Thursday from 10:00 to 13:30.

Friday 2017/11/10 from 15:00 to 18:30.