Content, progress and pedagogy of the module

The module is composed of two main blocks: data analysis, and financial statement analysis.

The data analysis block aims to teach the student how to understand and apply basic methods needed to collect, visualize, and interpret financial data. This includes, but is not limited to, data collection and visualization, data manipulation, and data conversions. This block also presents an introduction to statistical software, which will be relevant for other modules of the programme.

The financial statement analysis block provides the students with the knowledge to read, interpret and analyse financial statements using an IT tool in order to make informed business decisions regarding investment, credit, or resource allocation. Such skills are required for equity and credit analysts, executives, bankers, auditors, consultants and other users of financial information. Financial statement analysis represents a crucial part of fundamental analysis (FA), which aims at defining the intrinsic value of a company. The company´s value is the basis for determining the target price of a company’s stock, i.e. an estimate of a stock's future price based upon earnings forecast and assumed valuation multiples. Financial statements translate economic factors like assets, sales, margins, cash flows, and earnings into accounting numbers. This module focuses on how cash flows are generated, by considering management and strategic aspects of the business, and the risk related to the business from a financial and operational perspectives. After introducing an accounting-based valuation framework that integrates a firm's strategy, business model and intellectual capital, with its overall performance, the course specifically concentrates on the analysis of economic and financial performance, with a focus on profitability, liquidity and solvency.

Learning objectives

Knowledge

The objective is that the student after the module possesses the necessary knowledge on:

• the comprehensive evaluation of a company according to different stakeholders’ perspectives (e.g. investors, banks, employees, shareholders and consultants), by integrating firm's strategy, business model and intellectual capital, with its overall performance.
• how to interpret and use accounting information (both financial and non-financial information) in order to define the bases for forecasts.
• how to carry out data collection, relevant manipulation, basic exploratory data analysis, and data visualization. This includes the use of statistical software.

Skills

The objective is that the student after the module possesses the necessary skills in:

• calculating and commenting economic and financial margins and ratios deriving from data contained in financial statements using an IT tool.
• conducting comprehensive analysis, critically interpreting non-financial disclosure of published financial statements and reaching data-driven conclusions with respect to a firm's financial health and market position.
• collecting, analysing, preparing, converting, and interpreting financial data, including applications in statistical software.

Competences

The objective is that the student after the module possesses the necessary competences in:

• using financial statements to develop an understanding of company’s performance and to establish the basis for making reasonable valuation estimates.
• helping users of financial statements broadly understand a business and provide a context to financial numbers.
• adequate manipulation, transformation, and interpretation methods for financial data. Moreover, it is emphasized an introductory understanding of statistical software languages.

Type of instruction

For information see § 17.

Exam

Prerequisite for enrollment for the exam

• It is a prerequisite for exam participation that the student has handed in and received approval of specified assignments.
• If the student has not fulfilled the above prerequisite for participation in the ordinary examination, then it must be fulfilled to participate in the re-examination.

Exams