Reading 12
Integration of Financial Statement Analysis Techniques
6 modules 21 min
0/6
Exam Focus
This is a key topic review in Financial Statement Analysis, and perhaps as important as any of the financial statement analysis material. Here, you are required to use material presented earlier to make appropriate adjustments to the balance sheet and income statement using a common framework. Make sure you can determine and interpret the effects of management’s choice of accounting methods and assumptions on the reported financial results and ratios.
Modules
- Module 12.1Framework for AnalysisDemonstrate the use of a framework for the analysis of financial statements, given a particular problem, question, or purpose (e.g., valuing equity based on comparables, critiquing a credit rating, obtaining a comprehensive picture of financial leverage, evaluating the perspectives given in management’s discussion of financial results).1 min · 1 LOS
- Module 12.2Earnings Sources and PerformanceIdentify financial reporting choices and biases that affect the quality and comparability of companies’ financial statements and explain how such biases may affect financial decisions. · Evaluate the quality of a company’s financial data and recommend appropriate adjustments to improve quality and comparability with similar companies, including adjustments for differences in accounting standards, methods, and assumptions.4 min · 2 LOS
- Module 12.3Asset Base and Capital Structure3 min
- Module 12.4Capital Allocation4 min
- Module 12.5Earnings Quality and Cash Flow AnalysisEvaluate how a given change in accounting standards, methods, or assumptions affects financial statements and ratios. · Analyze and interpret how balance sheet modifications, earnings normalization, and cash flow statement related modifications affect a company’s financial statements, financial ratios, and overall financial condition.6 min · 2 LOS
- Module 12.6Market Value Decomposition3 min