University of Waterloo - School of Accounting and Finance

AFM 291 - Intermediate Financial Accounting 1

Course Outline Fall Term 2010 Section: Instructor: Office Number: E-Mail Address: Phone: 001, 002, 003 Gregory Clark, CMA HH 289J gvclark@uwaterloo.ca (519) 888-4567 ext. 38849 e-mail preferred Monday and Wednesday 2:30pm 3:30pm or by appointment Section 001 MW 10:00am 11:20am HH 1102 Section 002 MW 8:30am 9:50am HH 1102 Section 003 MW 1:00pm 2:20pm HH 1102 004, 005, 006 Robert G. Ducharme, MAcc, CA HH 383J rducharm@uwaterloo.ca (519) 888-4567 ext. 36879 e-mail preferred Monday and Wednesday 2:002:30pm and 7:007:30pm by appointment Section 004 MW 2:30pm 3:50pm HH 1102 Section 005 MW 4:00pm 5:20pm HH 1102 Section 006 MW 5:30pm 6:50pm HH 1102

Office Hours:

Class Times and Location:

REQUIRED COURSE MATERIALS: Kieso, Weygandt, Warfield, Young and Wiecek. Intermediate Accounting, 9th Canadian Edition (2010), Volume One, ISBN 978-0-470-16100-5 WileyPLUS Premium with electronic eText Canadian accounting standards are transitioning to International Financial Reporting Standards (IFRS) effective January 1, 2011. Given that this course is approaching that transition, it will cover both Canadian accounting standards for private enterprises (referred to as ASPE or PE GAAP) and IFRS (where there are significant differences with Canadian accounting standards). COURSE DESCRIPTION AND OBJECTIVES: This is the first of four courses dealing with the theory, principles and practice of financial accounting and external reporting: AFM 291, AFM 391, AFM 401 and AFM 491. The objectives of this course are for students to: become more familiar with the structure and content of financial statements; understand the environment in which financial reporting choices are made; know the options available under the current reporting model, develop skills in applying complex accounting standards, and understand how to use accounting information to make informed decisions. Topics covered include: revenue recognition, accounts receivable, inventory, investments, property plant and equipment, and intangible assets. This course will emphasize not only accounting knowledge, but also skills and attitudes necessary for the success of accounting professionals; such as the skills of learning how to learn, thinking and problem solving skills, communication skills, and ethical conduct.

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CLASS STRUCTURE: Class sessions will be a combination of lecture material, problem solving, case analysis and discussion. You are responsible for completing the assigned readings and problems/cases in advance of class, and are expected to participate in discussions during class. Please note that prior to any case discussion, discussing the case with, or examining notes from, students who already covered the case is a clear violation of the norms of this course. EVALUATION: The final course grade is based on your demonstrated capability in dealing with and understanding the course content. Evidence of this capability comes through classroom discussion, examinations, a written case assignment, and other vehicles that may be used throughout the course. Grades for the course will be determined based in the following allocation: Worst Exam Better Exam Written Case Assignment WileyPLUS Homework Assignments Participation Total either the midterm or final exam either the midterm or final exam Due Monday, October 18, 2010, before 4:00pm Best 6 of 8 assignments % 30 40 10 15 5 100

The midterm exam is scheduled for Friday, October 29, 2010, 4:30pm 6:00pm. The midterm exam locations will be announced once they are assigned. EXAMINATIONS: There is a midterm exam and a final exam for this course. The worse exam grade (midterm or final exam) will count for 30% of your final course grade. The better exam grade (midterm or final exam) will count for 40% of your final course grade. The final exam date and location will be announced by the Registrars Office later in the semester, but the final exam will be held during the official final exam period, December 9 December 22, 2010. The format of each exam will be a combination of multiple choice questions, problems and discussion questions. Each examination will be cumulative. The examinations will cover all of the assigned materials and will not be restricted to the materials explicitly discussed in class. A sample examination will be made available before each exam to aid you in preparing for the examination. Students must bring their Watcard to the midterm and final examinations. If a student starts to write an examination without the appropriate photo identification, the examination may not be graded and a mark of 0 will be assigned. An examination missed without adequate documentation will result in a recoded grade of zero for the exam. No make up midterm examination will be given under any circumstances. Please note that it is university policy that student travel plans are not considered acceptable grounds for granting alternative midterm or final exam times (http://www.registrar.uwaterloo.ca/exams/finalexams.html). Student travel plans are also not considered acceptable grounds for missing an exam. Missed examinations will not be accepted unless accompanied by either: 1. A medical note indicating that you should be excused from that specific assignment i.e. general purpose blanket medical certificates that do not mention the specific date of the assignment are unacceptable, or 2. A note from Professor Charters, the Undergraduate Officer in the School of Accounting and Finance, indicating that for, compassionate reasons, you should be excused from that specific assignment.

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In order to ensure fairness and equitable treatment to all class members this is a rule that you can consider absolute. Under no circumstances will the course instructor or any of the course teaching assistants provide unilateral assignment remission certificates. If you miss the midterm examination and provide either of the two documents mentioned above, the weight of the missed midterm exam will be shifted to the final exam (i.e., the final exam will count for 70% of your final course grade). A student who has a legitimate reason for missing a School of Accounting and Finance (AFM) final exam will normally write the final exam when scheduled by the Registrar's Office during the next offering of the course, and will be given a grade of INC until that time. The foregoing is contingent on there being a satisfactory basis for the absence with appropriate supporting evidence. Those missing a final exam without a legitimate reason will receive a 0 on the final exam. GRADE APPEALS: Requests for re-grading the midterm examination must be made in writing within one week after the examination has been returned. To ensure a consistent and fair treatment of all re-grade requests, later requests will not be accepted. Your written request must indicate your reasons for believing that a question was improperly graded. Appeals will only be considered where the total marks involved are 5% or more of the total available marks on the midterm, because marks below the 5% cut-off do not materially affect the overall course grade. The instructor reserves the right to re-grade the entire examination. Final exam grade appeal procedures are consistent with overall University policy. WRITTEN CASE ASSIGNMENT The written case assignment (Reliance Corporation) will count for 10% of your final course grade. This is an individual assignment and will be based on the analysis of a financial reporting case. This assignment is due no later than 4:00pm on Monday October 18, 2010 (please do not wait until the last minute to submit your assignment!). Late submissions will receive a grade of zero. Assignments must be submitted as a single Microsoft Word document in the correct electronic drop box in UW-ACE. It is your responsibility to verify your submission has been uploaded correctly. Further details of this assignment will be announced during class. Plagiarism detection software (TurnItIn) will be used to screen assignments in this course. This is being done to verify that use of all material and sources in assignments is documented. In the first lecture of the term, details will be provided about the arrangements for the use of TurnItIn in this course. Students are advised that they should record their paper ID number when they submit their assignment to TurnItIn using the UW-ACE TurnItIn dropbox. This will allow the UW-ACE support staff to track the paper if there are any submission or subsequent problems. WileyPLUS HOMEWORK ASSIGNMENTS There are 8 WileyPLUS homework assignments (see course schedule). Each assignment is due no later than 11:59pm on the Friday of the week that it is assigned. You may complete the assignments early. Late assignments will receive a grade of zero. The best 6 out of 8 WileyPLUS homework assignments will count for 15% of your final course grade. WileyPLUS assignment grades can be found on the WileyPLUS website. Information on registering for WileyPLUS and using WileyPLUS can be found at the course website in UW-ACE and at the WileyPLUS website (www.WileyPLUS.com).

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PARTICIPATION: Participation grades are intended to reward students that attend class regularly and contribute to class discussions and show willingness to discuss their solution to problems in front of the class. To ensure that a participation grade is awarded, we require that you bring name cards that can be placed on your desk in each class. These will be provided to you at the beginning of the semester. We also require that you attend your assigned section and sit in the same seat each lecture credit for participation cannot be given if you attend a different section. Throughout the course, both quantity and quality of the contribution will be taken into consideration. Examples of significant contribution include (but are not limited to) the following: A student demonstrates ability to apply, analyze and synthesize course material consistently (for example, through the analysis of a text problem or case question.) A student clarifies points that others may not understand. A student offers relevant, succinct input to class that advances the discussion or cuts to the core of the problem. Contribution can be negative as well as positive. Negative contributions, including arriving late, interrupting class, not being prepared, not showing respect for the instructor or classmates, and allowing cell phones and PDAs to disrupt the class, will also be taken into account. Participation will be monitored throughout the semester. On several days during the semester, your instructor will ask for your personal evaluation of your own participation and then give you feedback on his/her evaluation of your participation. Finally, if you must miss a class, please email the instructor prior to class with a brief explanation for your absence.

UW-ACE: The following materials will be provided on UW-ACE: Course outline Periodic announcements regarding course details Electronic copies of lecture notes and case assignment (these will not be handed out in class) Solutions to assigned problems Midterm solutions and practice exams

Most materials will be posted under Lessons in weekly folders.

RELEASE OF GRADES: Grades will be released through the course site on UW-ACE. Please note that University of Waterloo Policy 19 states that, final examination and final course grades shall not be posted before the final examination period ends.

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USE OF COMPUTER RESOURCES: All students are provided with Waterloo Nexus accounts which provide access to the World Wide Web, the CICA accounting and auditing collection, IFRS standards, FASB standards, and other software and databases. Students are reminded that UW computing facilities exist to support the research, instructional and administrative needs of the University. Misuse of these facilities may lead to disciplinary action. The Arts Computing Office provides guidelines on the appropriate use of computing facilities (see http://arts.uwaterloo.ca/ACO/aco_account_usage_policy.html). ACADEMIC INTEGRITY: For this course, all assignments and examinations must be the exclusive work of the individual student. Academic Integrity: In order to maintain a culture of academic integrity, members of the University of Waterloo community are expected to promote honesty, trust, fairness, respect and responsibility. [Check www.uwaterloo.ca/academicintegrity/ for more information.] Discipline: A student is expected to know what constitutes academic integrity [check www.uwaterloo.ca/academicintegrity/] to avoid committing an academic offence, and to take responsibility for his/her actions. A student who is unsure whether an action constitutes an offence, or who needs help in learning how to avoid offences (e.g., plagiarism, cheating) or about rules for group work/collaboration should seek guidance from the course instructor, academic advisor, or the undergraduate Associate Dean. For information on categories of offences and types of penalties, students should refer to Policy 71, Student Discipline, www.adm.uwaterloo.ca/infosec/Policies/policy71.htm. For typical penalties check Guidelines for the Assessment of Penalties, www.adm.uwaterloo.ca/infosec/guidelines/penaltyguidelines.htm. Students are encouraged to consult the Faculty of Arts web page related to Avoiding Academic Offences (see http://arts.uwaterloo.ca/arts/ugrad/academic_responsibility.html). Students majoring in accounting programs at UW should be aware that, due to the highly structured nature of the study plans and the fact that many AFM courses are offered on a limited basis, a penalty imposed as a result of an academic offence could result in a significant delay of the students degree completion and convocation dates - particularly if the penalty involves a suspension. STUDENTS GRIEVANCE RIGHTS: Grievance: A student who believes that a decision affecting some aspect of his/her university life has been unfair or unreasonable may have grounds for initiating a grievance. Read Policy 70, Student Petitions and Grievances, Section 4, www.adm.uwaterloo.ca/infosec/Policies/policy70.htm. When in doubt please be certain to contact the departments administrative assistant who will provide further assistance. Appeals: A decision made or penalty imposed under Policy 70 (Student Petitions and Grievances) (other than a petition) or Policy 71 (Student Discipline) may be appealed if there is a ground. A student who believes he/she has a ground for an appeal should refer to Policy 72 (Student Appeals) www.adm.uwaterloo.ca/infosec/Policies/policy72.htm. NOTE FOR STUDENTS WITH DISABILITIES: The Office for Persons with Disabilities (OPD), located in Needles Hall, Room 1132, collaborates with all academic departments to arrange appropriate accommodations for students with disabilities without compromising the academic integrity of the curriculum. If you require academic accommodations to lessen the impact of your disability, please register with the OPD at the beginning of each academic term..

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COURSE SCHEDULE: Week 1 Dates M Sep 13 & W Sep 15 Ch. Topic Introduction to AFM 291 What is this course all about? The big picture: The Canadian financial reporting environment The conceptual framework E2-7, P2-5, P2-6 Respond to questions in RA2-1 Teck Cominco E3-13, E3-21, P3-1, P3-14 Assignment

2, 2A

M Sep 20 & W Sep 22

3, 3A

Accounting information systems A review of debits and credits Cash and Receivables 1 WileyPLUS assignment #1 (chapters 1-3, 2A, 3A) Cash and Receivables 2

7, 7A

E7-14, E7-19, P7-2, P7-5, P7-7, P711, P7-12

M Sep 27 & W Sep 29 8, 8A

Inventory 1 WileyPLUS assignment #2 (chapter 7, 7A) Inventory 2

E8-19, E8-21, P8-3, P8-4, P8-6, P813 Respond to questions in CA8-3 Fuego Limited

M Oct 4 & W Oct 6 9, 9A

Investments 1 WileyPLUS assignment #3 (chapter 8, 8A) Oct 11 (Thanksgiving) no class Investments 2

E9-1, E9-3, E9-21, E9-24, P9-1, P94, P9-10, P9-13

M Oct 11 & W Oct 13

M Oct 18 (written case assignment) 6 M Oct 18 & W Oct 20 10, 10A

Written Case Assignment (Reliance Corporation) Due Monday October 18, no later than 4:00PM Investments 3 Acquisition of Property, Plant and Equipment 1 WileyPLUS assignment #4 (chapter 9, 9A) E10-24, E10-29, P10-2, P10-3, P108, P10-10, P10-12, P10-13

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COURSE SCHEDULE (CONTD): 7 M Oct 25 & W Oct 27 F Oct 29 (midterm exam) Acquisition of Property, Plant and Equipment 2 Review MIDTERM EXAM (Covers Chapters 1-3, 7-10, and all related chapter appendices as noted in above schedule) Amortization, Impairment, and Disposition 1 & 2 Respond to questions in RA10-4 Homburg Invest Inc

M Nov 1 & W Nov 3

11

E11-12, E11-20, P11-5, P11-8, P1111, P11-12, P11-13

M Nov 8 & W Nov 10 12

Amortization, Impairment, and Disposition 3 Goodwill and Other Intangible Assets 1 WileyPLUS assignment #5 (chapter 10, 10A, 11) E12-11, P12-1, P12-6, P12-7, P128, P12-9 Respond to questions in CA12-1 Acquisitions Limited

10

M Nov 15 & W Nov 17 5 (ignore Section 2 Statement of Cash Flows) 4, 4A

Goodwill and Other Intangible Assets 2 Financial Position 1 WileyPLUS assignment #6 (chapter 12) P5-3, P5-5

11

M Nov 22 & W Nov 24

Reporting financial performance and the quality of earnings 1

P4-3, P4-8, P4-10, P4-14 Reading: The Latest Magic in Corporate Finance (see web-link in lecture notes) E6-23, P6-2, P6-8, P6-9, P6-10 Respond to questions in CA6-2 Cutting Edge

Revenue Recognition 1 WileyPLUS assignment #7 (chapters 4, 4A, 5)

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COURSE SCHEDULE (CONTD): 12 M Nov 29 & W Dec 1 M Dec 6 Revenue Recognition 2 Review WileyPLUS assignment #8 (chapter 6) Dec 9-22 Final Exam (Covering Chapters 1-12 and all related appendices as noted in above schedule i.e., all course material)

NOTES: The schedule is approximate some topics will take more time and some less. Adjustments will be made as necessary throughout the term.

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