Syllabus

BUS 512M Financial Reporting & Analysis

Susan Crosson
Office: Room 462
Cell phone: 352-219-0770
Email: susan.crosson@emory.edu
Description
Financial accounting is a conceptual model and methodology for measuring, processing, and
communicating financial information about the business activities of an organization. Financial reporting
consists of corporate financial statements and other financial disclosures that companies provide to
investors and other stakeholders. Financial Statement Analysis includes both accounting analysis and
financial statement ratio analysis. This course covers financial accounting, financial reporting, and
accounting analysis, as well as financial statement ratio analysis to a limited extent. Financial statement
ratio analysis is covered more extensively in the corporate finance sequence in the program.

Managers often have a significant amount of latitude in deciding how to treat economic events
in the financial accounting model and how to report them in the financial statements; hence, it
is important for companies to develop accounting policies and strategies to achieve relevant
and reliable financial reporting that is consistent with their business strategies. This course is
presented from a user or managerial perspective, rather than a preparer perspective.
Upon completing it, students will have an understanding of the financial accounting and
reporting model and how it is applied in a wide variety of organizations and applications. We
will use the annual reports of publically traded companies as our primary frames of reference in
the course.
Course Learning Objectives
1. Understand basic measurement concepts underlying primary financial statements and the
relative importance of the Income Statement, Balance Sheet, Statement of Cash Flows, and
Statement of Retained Earnings.
2. Locate and use information on a corporate annual report to analyze a companys financial
performance and position.
Course Text
Pratt, Jaime, Financial Accounting in an Economic Context, Wiley, 2009 (8th Edition).
E-Resources
1. There is a 512M-14 course conference on Blackboard and FirstClass that will be used for all
outside-of-class communications. All course materials, including announcements,
assignments, lecture notes, explanations, assignment solutions, and other course materials
will be provided at various times on Blackboard or in FirstClass.
2. As stated above, we will use the annual reports of publically traded companies like Nike,
Coca-Cola, Walmart, and Eli Lilly and Company as our primary frames of reference in our

study of financial reporting. Links to annual reports used will be posted to the 512M-14
Blackboard course. In addition, photo copies of financial statements from annual reports
used in class will be provided to you in your residency materials.
Pre-Course Work
Financial Reporting & Analysis requires students to have a minimum working knowledge in
financial accounting before beginning the first residency of the course. Therefore, depending on
your background, there may be a significant amount of work to do during the Pre-Course Work
period for the first residency. Financial reporting relies on the system of double-entry
accounting, the basic structure of financial statements, and a specific set of terms and concepts
that should be mastered before our first course meeting. Several resources are available in the
Module One folder in Blackboard to assist you in achieving these necessary skills, including
YouTube videos and pencasts. You can also read the first five chapters of the Financial
Accounting textbook that cover these concepts and procedures.
To assist you in assessing your readiness to begin the 1st residency, a homework assignment
will be available for this course November 4, 2012. Your solution to this assignment which
applies pre-course material, should be submitted for grading at the start of class on
November 29, 2012. There will be an optional homework help session the week of November
25-29, time and location TBA.
Determination of Grades:
Grades will be based on the following:
Homework/Quizzes/Participation/Engagement

30%

Mid-term Exam-Individual Assignment

35%

Final Exam-Individual Assignment

35%
100%

Grades will be based on the Schools MBA grading policy. The top 15% of the class will receive a
grade of DS, and the next 35% will receive a grade of HP. If all goes well -- and if we all fulfill our
respective responsibilities -- no more than 10% will receive a grade lower than PS.
Description of Grade Components:
The quizzes and exams will be open book and open notes. The mid-term and final exams
typically consist of a combination of multiple choice questions, short-answer questions and
problems, and questions based on actual annual reports. Quizzes and exams will be submitted
to me via Blackboard or email, susan.crosson@emory.edu.
The homework/participation/engagement component attempts to measure the quality of an
individuals contribution to his/her classmates learning experience and the effort applied in

learning the course material. The grade is based on three types of information: (1) a peer
evaluation where each student lists five classmates (at most) that have had a positive impact on
their learning experience, (2) my own assessment of in-class interaction and online
engagement, and (3) the number of completed homework assignments turned in. To receive
credit for homework, students should submit a copy of it on or before it is due. It is entirely
appropriate to work these with other classmates, provided each person makes a good faith
effort to work the assignments independently. Merely copying someone elses solution should
not be done as doing the homework aids considerably in improving your understanding of the
course material. Homework is graded for effort and not accuracy.
Preparation & Participation
Course preparation is crucial to the learning process. In fact, most of the actual learning takes
place outside of the classroom, which is then modified and/or reinforced by the in-class
discussion. Because financial accounting is an integrated conceptual model, each part of the
model must be understood before subsequent elements are introduced. Hence, staying up with
the pace of the course is vital. It is essential that you read and study the assigned chapter
material in advance of each class. In addition, each problem assignment for the class must be
analyzed and prepared (either by you individually or in study groups) prior to the class.
Electronic copies of the assignment solutions will be made available to you after we have
covered the assignments in class, or for the on-line segment of the course, after you have
turned in your assignments. YouTube videos and/or pencasts will be provided to you for each of
the topics in advance of the coverage of the topic online or in class. During the distance learning
modules, there will be optional online discussions (on Adobe Connect) of selected issues
covered in the modules, these will be recorded and archived for later viewing.
Readings & Assignments
The following pages present the required readings and assignments for the entire course. The
numbered assignments are from the Pratt textbook. Homework will be submitted for grading
for Modules 1, 2, 3, 5, 6, 8, and 9. Homework for the other modules will be discussed but will
not be collected. Homework submitted for grading should be sent to me via Blackboard or
email susan.crosson@emory.edu on or before the due dates listed.
You are encouraged to find articles relevant to course topics as you read The Wall Street
Journal or other financial publications on a regular basis. Please send me the article via email
and state the relevant course topic when you find one. The WSJ and other business
publications are available to you on-line without cost on the Goizueta Library data bases. Please
note that all of the copyrighted course materials posted on Blackboard will be obtained from
the Emory Library data bases, which are available directly to all Goizueta students. By
downloading articles from the Library data bases not only are they more convenient but it is
done with the express permission of the Emory Library staff and does not violate any copyright
laws or the Librarys agreements with its data base providers.

Submitting Homework and Exams Via BlackBoard or Email

Please observe the following guidelines in submitting work:

If Excel files are submitted, the spreadsheets should be formatted so that all related
materials will print on the same page. I recommend that, before sending any materials in Excel
files, you print them to make sure they are properly formatted. You can also save them as a pdf.

The names of all attached files should include your name, plus a brief description of the
document; for example, Jdoe Quiz #1, Jdoe Prob. 5-32, or Jdoe Mid-term

All required submitted assignments and exams should be submitted using the Subject
line 512M-Name of the Assignments-Your First and Last Name.
Assignment Due Date Chart
Module 1: JG and Sons
Module 2: Emory Inc.
Module 3: E 14-8
Module 5: Allowance for Bad Debts
Module 6: Alternative Inventory Methods
Module 8: Depreciation Methods and
Equipment Disposal
Module 9: Treatment of Bonds and
Determining the Effective Interest Rate

At the start of class on November 29, 2012

At the start of class on November 30, 2012
At the start of class on December 1, 2012
In Blackboard on or before NOON January 14,
2013
In Blackboard on or before NOON January 21,
2013
At the start of class on February 11, 2013
At the start of class on February 12, 2013

Other Guidelines
To enable everyone in the class to gain the most from the in-class experience, students are
requested to observe the following guidelines during the residencies:

Please be in class and prepared to begin on time for each class and after each break.

Please do not leave the room during class except for personal emergencies. If you need
to leave, please do so as quietly as possible;

It is important to bring your textbook and/or cases with you to all class sessions since
we will be covering textbook problems and/or cases in most class sessions. Failure to bring
these materials will make it difficult for you to participate adequately in class discussions and
may result in a loss of participation credit. It is also requested that you bring a company you are
interested in or your companys annual report to class.

The MEMBA Program policy regarding notebook computers will apply to this course;
consequently, we will observe a closed notebook policy during class time.

Course Calendar -- 512M

Date
Topic

Text Reading

Assignments &
Preparation

Assignment for
Evaluation

11/4 to
11/24

PRE-WORK
PERIOD FOR
NOVEMBER
RESIDENCY
Module 1
Mechanics of
Financial
Accounting

Pratt Chapter 4

Module 1 folder

11/4 to
11/24

Prepare for
Modules 2, 3,
and 4.

Pratt Chapters 2,
3, 5, 14, and
Appendix A

Module 2 folder
Module 3 folder
Module 4 folder

11/26

There will be an optional face-to-face help session on 11/26 at 5:30-7:00 in W330 for JG
and Sons handout homework.
Module 2
Pratt Chapters 2
Module 2 folder
Complete Emory Inc.
Primary
and 5
handout and submit a
Financial
copy at the beginning
Statements
of class 11/30
Module 3
Pratt Chapter 5
Module 3 folder
Complete E14-8 in
Primary
and 14
text and submit a
Financial
copy at the beginning
Statements
of class 12/1
continued
Module 4
Pratt Chapter 3
Module 4 folder
and Appendix A

11/29
8:0011:30
11/30
8:0011:30

12/1
8:0011:30

Complete
JG and Sons handout
and submit a copy at
the beginning of class
11/29.
There will be an
optional face-to-face
help session on 11/26
at 5:30 in W330.

Midterm will be distributed electronically December 15 and will be Due before 11:59 PM (Atlanta
time) Sunday December 23, 2012.
Enjoy the holidays 12/24 to 1/5.
Week of
1/6

Week of
1/13

Module 5
Cash and
Accounts
Receivable
Module 6
Merchandise
Inventory

Pratt Chapter 6

Module 5 folder

Submit Allowance for

Bad Debts handout
before NOON 1/14

Pratt Chapter 7

Module 6 folder

Submit Alternative
Inventory Methods
handout before
NOON 1/21

Week of
1/20
1/27
2/9

2/10
1:004:30

Module 7
Current
Liabilities
PRE-WORK
PERIOD FOR
FEBRUARY
RESIDENCY
Prepare for
Modules 8, 9,
and 10.
Module 8
Accounting
for
Investment
Decisions

2/11
1:004:30

Module 9
Accounting
for Financing
Decisions

2/12
1:004:30

Module 10
Wrap up and
field trip
Michael
Carlos
Museum

Pratt Chapter 10
pages 437-450

Module 7 folder

Pratt Chapters 8,
9, 10, 11, and 12

Module 8 folder
Module 9 folder
Module 10 folder

Pratt Chapter 8
Module 8 folder
pages 333-61
(equity
investments) and
Chapter 9 pages
385-418
(property, plant ,
and equipment
and intangibles)
Pratt Chapter 10
Module 9 folder
pages 450-6
(contingent
liabilities), Chapter
11 pages 485-514
(bonds and notes),
Chapter 12 pages
547-75 (owners
equity)
Module 10 folder

Complete Alternative
Depreciation
Methods and
Equipment Disposal
handout and submit a
copy at the beginning
of class 2/11

Complete Treatment
of Bonds and
Determining the
Effective Interest Rate
handout and submit a
copy at the beginning
of class 2/12

Final Exam distributed electronically February 24 and is Due before Midnight (Atlanta time) on
Saturday March 2, 2013.

U.S. GAAP IFRS Convergence

For the past several years, the Financial Accounting Standards Committee (FASB) and the
International Accounting Standards Board (IASB) have been working cooperatively to
harmonize U.S. Generally Accepted Accounting Principles (GAAP) and International Financial
Reporting Standards (IFRS). In 2007 the SEC adopted a policy that allows non-U.S. companies
that are listed on the U.S. stock exchanges to present their financial statements to the SEC

based on IFRS without any reconciliation of IFRS earnings with U.S. GAAP earnings. The U.S.
financial reporting environment is in the greatest state of flux that it has ever experienced. At
this point, we can only speculate on what changes beyond current GAAP are likely to occur over
the next several years for U.S. companies. Although this course is not designed to train
managers in all the complex details of financial accounting standards, one purpose is to
acquaint the executive student with the major underlying assumptions upon which financial
statements are based. Because of the high degree of uncertainty regarding future changes, it is
not feasible to devote a significant amount of time in this course to exploring possible future
changes. Our goal will be primarily to acquaint you with major current accounting standards
and conventions, and where appropriate to discuss existing differences between U.S. GAAP and
IFRS.