Financial analysis and modeling

2024/2025

Academic Year

ENG

Instruction in English

3

ECTS credits

Delivered at:

Department of Finance

Course type:

Compulsory course

When:

1 year, 2 module

Instructor

Churakova, Iya

Course Syllabus

Abstract

Financial statements are the only open sources of financial information about a company and In order to understand financial position and performance of a company we need to be able to read and interpret financial statements and make conclusions based upon them . For that it is essential to understand accounting principles, and accounting standards and to practice financial statements analysis skills.Financial forecasting is essential for the development of a firm. The three financial statements for forecasting are the pro forma income statement, pro forma balance sheet and the cash budget. In this course, we will discuss various methods of financial forecasting.

Learning Objectives

• Learn to make analysis of financial statements, make conclusions upon the financial performance and position of a company
• Analyze financial statements and financial reports of companies of different industries
• Learn how to analyze banking financial state
• Describe and explain essential principles of forecasting financial statements.
• Learn how to build pro-forma statements
• Identify and apply various approaches to forecasting of financial statements

Expected Learning Outcomes

• Assessment of the financial position of the company using traditional and modern istruments.
• Identify financial strengths, weaknesses and relationships in the position of the company
• Understand basic tools of financial management and financial calculations.
• Understanding financial risk and its impact on the company's operations.
• Knowledge of basic algorithms for building and applying financial distress prediction models and the ability to apply them to the performance of a particular company.
• Know the importance of detecting fraud in financial statements and other documents related to a company's business life and reputation.
• Possess methods of fraud detection based on financial statements (Beneish's M-score, Benford's law, matched time series analysis).
• Know what the financial health of a company is and what components it consists of.
• Analyse the financial health of the company, selecting appropriate methods of analysis.
• Build models to predict the financial health of a company.

Course Contents

• Topic 1. Revision, introduction, basic case analysis
• Topic 2. Case 2 analysis
• Topic 3. Case 3 analysis
• Topic 4. Business analysis, accounting issues

Assessment Elements

• Analysis of the financial statements
• Predicting financial distress of companies: indicators and models
• Fraud detection methods
• Financial health of the Company

Interim Assessment

• 2024/2025 2nd module
  0.1 * Analysis of the financial statements + 0.4 * Financial health of the Company + 0.4 * Fraud detection methods + 0.1 * Predicting financial distress of companies: indicators and models

Bibliography

Recommended Core Bibliography

• Analysis for financial management, Higgins, R. C., 2016
• Corporate financial distress and bankruptcy : predict and avoid bankruptcy, analyze and invest in distressed debt, Altman, E. I., 2006
• Essentials of corporate fraud, Coenen, T., 2008
• Financial Statement Fraud and Financial Stability. (2019). Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.A19809A6
• Sherman, E. H. (2015). A Manager’s Guide to Financial Analysis : Powerful Tools for Analyzing the Numbers and Making the Best Decisions for Your Business: Vol. Sixth edition. AMA Self-Study.
• Казакова, Н. А. Financial analysis: collection of case studies: Учебное пособие / Казакова Н.А., Дун И.Р., Бобкова М.П. - Москва :НИЦ ИНФРА-М, 2018. - 54 с.ISBN 978-5-16-106744-4. - Текст : электронный. - URL: https://znanium.com/catalog/product/972205

Recommended Additional Bibliography

• Corporate strategy and financial analysis : managerial, accounting and stock market perspectives, Ellis, J., 1993
• DeAngelo, H., DeAngelo, L., & Wruck, K. H. (2002). Asset liquidity, debt covenants, and managerial discretion in financial distress:*1: the collapse of L.A. Gear. Journal of Financial Economics, (1), 3. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsrep&AN=edsrep.a.eee.jfinec.v64y2002i1p3.34
• Forensic accounting and fraud examination, Kranacher, M.-J., 2020
• International financial management, Madura, J., 2020

Authors

• SOLOVEVA EKATERINA EVGENEVNA
• CHURAKOVA Iiia Iurevna