Financial Analysis Introduction Sipei Zhang October- December 2015 Moodle : Financial Analysis Subject: « FSA » 1

Aim of the course This course is designed for students in order to improve their skills at analyzing companies and to advance their knowledge of finance theory and application. Some of the objectives of this course include: Improved ability to analyze and value companies in different industries using skills of finance, accounting and economics. Greater understanding of the business strategy and financial ratios of well-known companies in various industries. Review of major accounting and finance principles. Improved forecasting and valuation skills. Greater understanding of the financial issues and problems occurring at the current time. 2

About the Exams This course have two exams : Mid-term exam: 60 mins, 30 MCQs about the conceptions and calculations, which should be settled during the 4 th course, 17 November (if there is no accident). 1/3 of weights in the final evaluation. The final exam: 120 mins, 60 MCQs about the conceptions and calculations, which should be settled after the end of the course, during the “final exam week”. 2/3 of weights in the final evaluation. 2 points of bonus will be added to the final evaluation for those who participate no less than 7 courses. (8 courses in total) 3

Course Structure 30 hours of course on the basic of Financial Statement Analysis: Overview of Financial Statement Analysis Financial Reporting and Analysis Prospective Analysis Ratio Analysis Introduction of Financial Calculator :TI BA II (PLUS) Review of the course and get prepared to the final test PS: The main purpose is not to learn everything in depth but to getting familiar with the concepts of the Financial Analysis and the related tools. 4

Course Structure 1st session Topic: Overview of Financial Statement Analysis Main objectives: Explain business analysis and its relation to financial statement analysis Describe component analyses that constitute business analysis Explain business activities and their relation to financial statements Apply several basic financial statement analysis techniques Analyze and interpret financial statements as a preview to more detailed analyses Define and formulate some basic valuation models Explain the purpose of financial statement analysis in an efficient market 5

Course Structure 2nd session Topic: Financial Reporting and Analysis (Accounting Analysis) Main objectives: Explain the financial reporting and analysis environment Identify what constitutes generally accepted accounting principles (GAAP). Describe the objectives of financial accounting Explain the importance of accrual accounting and its strengths and limitations Describe the need for and techniques of accounting analysis Analyze and measure earnings quality and its determinants 6

Course Structure 3rd session Topic: Prospective Analysis Main objectives: Describe the importance of prospective analysis Evaluation tools for debt(bond), equity etc. Explain the process of projecting the income statement, the balance sheet, and the statement of cash flows. 7

Course Structure 4th session Topic: Ratio Analysis Main objectives: Explain how ratios can be used to assess the position and performance of a business. Identify the major categories of ratios that can be used for analysis purposes. Calculate key ratios for assessing the profitability, efficiency, liquidity, Financial Leverage and Market performance of a business. Explain the significance of the ratios calculated. 8

Course Structure 5th session Review of course; preparation to exam Introduction to the financial calculator (if need) Potential questions 4H = 240mins, 60mins+15mins(break)+ 90mins(70mins+20mins of Free Question time) 9