ACIS 5194

Financial Statement Analysis, Spring 2014

Instructor: Robert Brown
Phone: 231-5869
W

Text:

Office: 3015 Pamplin

Office Hours:10:0010:45 Tu,Th;10:00 -10:45
Others by App.

Penman, Stephen H. Financial Statement Analysis & Security Valuation. Fifth Edition, 2013

Course Objectives:
To provide the tools and theoretical background necessary for analyzing financial statements from the
perspective of making investment decisions. The valuation emphasis is accounting based, however
finance principles are integrated into the analysis. By the end of this course students should be able
to prepare analysts research reports and be able to make buy/sell recommendatons.
Research project:
A group research report and presentation of that report is required. See separate handout for
additional information. The report should not exceed 15 pages. A one page summary (executive
summary) high lighting the main points must also be prepared and handed out to the class before
the presentaion.
Grading:
Problem Assignments and Quizes
25%
Class Participation
10%
Midterm
20%
Group Research Project
25%
Final
20%
Honor Code:
The honor code will be strictly enforced in this course. All assignments will be considered graded work, unless
otherwise noted. All aspects of your course work are covered by the honor system. Any suspected violations of
the honor code will be promptly reported to the honor system. Honesty in your academic work will develop into
professional integrity. The faculty and students of Virginia Tech will not tolerate any form of academic
dishonesty.
Tentative Course Outline
```````````````` Introduction to Investing and Valuation - Chap 1
23-Jan-14 Introduction to Financial Statements - Chap 2
C1.5, C1.6, E1.2, E1.5, E1.6, M1.1
28-Jan-14 HowFin Stmts are used in Valuation - Chap 3
C2.4,C2.4, E2.1, E2.11, E2.13, E2.14
30-Jan-14 BH
4-Feb-14
HowFin Stmts are used in Valuation - Chap 4
C3.6, C3.10, E3.1, E3.8, E3.15, M3.1
6-Feb-14
Cash Accting, Accr Accting and DCF - Chap 4
C4.10, E4.1, E4.4, E4.7, E4.9
11-Feb-14 Accrual Acct & Valuation: Pricing Book Values Chap 5
E4.9, E4.10, M4.1
13-Feb-14 Accrual Acct & Valuation: Pricing Earnings - Chap 6
C5.4, E5.4, E5.9, E5.11, M5.3
18-Feb-14 Valuation and active investing- Chap 7
C6.2, C6.10, E6.1, E6.3, E6.12, E6.14
20-Feb-14 Valuation and active investing- Chap 7
C7.3, C7.6, E7.1, E7.2, E7.10, E7.12
25-Feb-14 Viewing the Business through Fin Stms Chapter 8
M6.1, E7.9, E7.13
27-Feb-14 Analysis of Shareholders Equity - Chap 9
C8.2, C8.3, E8.1, E8.5, E8.7, E8.8
4-Mar-14
Midterm
6-Mar-14
Guest Speaker Chris Shean, Sr VP and CFO
LibertyMedia Corp
11-Mar-14 Analysis of Balance Sheet & Inc Statement - Chap 10
E9.1, E9.4, E9.7, E9.5
13- Mar-14 SPRING BREAK
18-Mar-14 Analysis of Cash Flow Statement Chap 11
C10.5, C10.6 E10.2, E10.7, E10.10
20-Mar-14 Analysis of Profitability - Chap 12
C11.8, C11.9, E11.2, E11.3, E11.9
25-Mar-14 Analysis Growth & Sustainable Earnings - Chap 13
C12.1, C12.8, E12.3, E12.7, E12.8
27-Mar-14 GUEST SPEAKER
1-Apr-14
GUEST SPEAKER

3-Apr-14

Value of oper & Evaluation of P/B & P/E - Chap 14

8-Apr-14
10-Apr-14
15-Apr-14
17-Apr-14
22-Apr-14

Simple Forecasting and Valuation - Chap 15

Full Info forecasting, Valuation - Chap 16
Creating Accting Value & Economic Value Chap 17
Example prob for Ch 16, Chapter 17
Analsis of the Quality of Fin Statements Chap 18

24-Apr-14

Analysis of Equity Risk & Cost of Capital Chap 19

29-Apr-14
30-Apr-14
1-May-14
6-May-14
8-May-14

Case Presentation
Case presentation
Case Presentation
Reading Day

C13.10, C13.15, E13.2, E13.4, E13.5,

E13.9
C14.7, E14.2, E14.3, E14.5, E14.10
C15.1, C15.6, E15.2, E15.5, E15.8
C16.2 C16.3,E16.2, E16.4, E16.6
C17.2, C17.9, C17.11, C17.13, E17.2,
E17.5, E17.7
M17.3,C18.1, C18.9, C18.10, C18.11
C18.15, E18.1, E18.2, E18.3, E18.4
C19.5, C19.9, E19.1, E19.2, E19.6,
M19.6