Financial Statement Analysis

UNIVERSITY OF TEXAS AT DALLAS

Course Syllabus
SUMMER 200 5

Instructor: Shu Lin

Course Number: AIM 4336
Semester Hours: 3
Location: SOM 2.904
Time: Monday, 6:00-10:00 p.m.
Office Hours: Tuesday 1:00 – 2:00pm or by appointment
Office Phone: (972) 883-4442
Email Address: sxl015300@utdallas.edu

Course Overview:
The course will cover financial statement from a user’s perspective. My goal is to
develop your understanding of the relation between accounting numbers and
underlying economic activity, and to develop your ability to use accounting numbers
in several decision contexts. These contexts include corporate performance
evaluation, financial reporting strategy, and valuation.

Through a mixture of lecture/case discussion, we will develop the following essential

financial analysis skills:
1. Understanding the business environment in which a firm operates and the
firm's financial, accounting and operating strategies;
2. Understanding how the accounting process that generates financial numbers
affects the quality of those numbers used in decisions;
3. Assessing a firm's performance, including ratio and cash flow analysis;
4. Using accounting numbers to make a reasonable assessment of the firm’s
future position.

Prerequisites:
Pre-requisite: AIM -2301
Pre-requisite: AIM -2302
Pre-requisite: MATH-1325
Pre-requisite: MATH-1326
Pre-requisite: MATH-2333

Required Materials:
Financial Reporting & Analysis, 9th Edition, Charles Gibson, 2004, South-Western
Publishing.

Homework:
All assignments should be completed and turned on WebCT by noon prior to class.
To assist with discussion in class and make grading of homework easier also
bring a hard copy of the assignment with you to class on Wednesday to turn in.
The class format will typically be to lecture on the information a week before the
assignment is due then discuss the questions from that chapter the following week.
Homework assignment will be made at least a week in advance.

Communication:
We will make use of WebCT for posting assignments and projects. Also, you can
take advantage of the discussion features of WebCT to discuss issues with other
students.

Case Studies and Discussion:

The textbook has extensive problems, case studies, to the net exercises, and a Web
Case at the end of each Chapter. Make sure you are doing the correct problems, case
studies and questions as each chapter will have different problems assigned from each
area. You will be assigned problems and case studies which will later be selected for
review and discussion in class.

Individual Final Project:

Each student will chose a company to do a comprehensive financial analysis. The
individual project will require a written paper. The company should be publicly
listed with as much information available as possible. It is important that you be
able to present information very concisely after your extensive research. You will be
applying all concepts learned throughout the semester for this project to be successful.
To make this of most value to you I suggest this be a company that you would like to
work at, invest in, parents work at, or you would like to know more about.

Selection of the companies will be based on a lottery which numbers will be drawn on
May 16. Each student will select a different company which will be decided at the
second class period on May 23. If for some reason you will not be at class you need
to have another student select for you or you will need to select at the following class.
In no case will two students have the same company.

Exam:
You will have only one mid-term exam. It is open book and will cover the topics
from Chapter 1 to 7.
Grading:

Your grade will consist of the following:

Percent

Mid Term Test 40%

Individual Final Project 35%
Homework and Class Participation 25%
___
Total Points 100%

Academic Dishonesty:

Candidates are expected to be above reproach in scholastic activities. Candidates who

engage in scholastic dishonesty are subject to disciplinary penalties, including the possibility
of failure in the course and dismissal from the University. “Scholastic dishonesty includes,
but is not limited to cheating, plagiarism, collusion, the submission for credit of any work or
materials that are attributable in whole or in part to another person, taking an examination
for another person, any act designed to give unfair advantage to a student or the attempt to
commit such acts.” 1 Since scholastic dishonesty harms the individual, all candidates,
and the integrity of the University, policies on scholastic dishonesty will be strictly enforced.

1
(Regents’ Rules and Regulations, Part One, Chapter VI, Section 3, Subsection3.2, Subdivision 3.22
 Class Schedule

Week Date Topic Chapter

1 May 16, 2005 Introduction to Financial Reporting Chapter 1
2 May 23, 2005 Introduction to Financial Statements Chapter 2
Balance Sheet Chapter 3
Individual Project Assignments
3 May 30, 2005 Balance Sheet Chapter 3
Income Statement Chapter 4
4 June 6, 2005 Income Statement Chapter 4
Basics of Analysis Chapter 5
5 June 13, 2005 Liquidity of Short Term Asset Chapter 6
6 June 20, 2005 Long-Term Debt-Paying Ability Chapter 7
7 June 27, 2005 Midterm Exam
8 July 4, 2005 Profitability Chapter 8
9 July 11, 2005 For the Investor Chapter 9
Statement of Cash Flows Chapter 10
10 July 18, 2005 Statement of Cash Flows Chapter 10
11 July 25, 2005 Last Homework Due
Individual Project Due