BØK 3532 Financial Accounting and Financial Statement Analysis
BØK 3532 Financial Accounting and Financial Statement Analysis
All limited companies and many other enterprises must annually prepare financial statements, which give all interested parties an insight into how the economic situation has developed. In this course students learn how financial statements are prepared and how they can be used.
Financial statements must be organized in a specific manner. The legislation for this area is extensive and regulates the entire production process: from bookkeeping of the enterprise's transactions to the type of information that has to be disclosed in the publicly available annual report.
The first part of the course gives an overview of financial statements and the role accounting information plays in the economy. The second part covers techniques and methods used for an enterprise to record all its transactions in the course of a year. It is not sufficient to consecutively book the transactions that take place. The financial statements must be set up at the end of the fiscal year, which means that the enterprises must value their assets and debts and calculate how much that has been lost or gained. The third part covers this process and addresses what the financial statements shall include of information and the Norwegian rules that govern valuation of assets and liabilities and recognition of revenues and expenses.
Financial statements are publicly available and vital information on every Norwegian company can be accessed by just pressing a key, since the main figures are freely available on the Internet. The fourth part of the course covers how financial statements can be used.
After having completed the course the students shall be able to:
- Record ordinary transactions and incorporate frequent closing provisions (including calculation of the annual tax cost and allocation of net income) in accordance with the principle of double-entry book-keeping, and draw up the final income statement and balance sheet.
- Describe the main accounting rules for measurement of assets and liabilities in Norway.
- Know that Norwegian enterprises may report according to Norwegian accounting rules or IFRS (International Financial Reporting Standards).
- Describe a few important differences between measurement rules of assets according to Norwegian rules and IFRS (International Financial Reporting Standards).
- Obtain accounting information from the internet.
- Analyse financial statements with an emphasize on profitability and long and short-term liquidity.
Students should be able to:
- Record transactions, close the accounts and prepare the main reports included in an annual report (i.e., set up the income statement, balance sheet and cash flow statement)
- Employ the accrual concept of accounting and determine values of assets and liabilities in accordance with the Norwegian Accounting Act
- Analyze companies' financial statements and compare a company's developments with previous years and against its peers
- Give an account of the importance of sustainability reporting
- Use digital tools to gather information and solve tasks
Attitudes and judgment:
- Have insight into the importance of accounting regulations for society, the reporting entities, and accounting users
- Understand the purpose of financial statements, its strengths and weaknesses
- Understand the significance of the measurement rules for determining the value of equity in businesses and that the measurement rules in the Norwegian Accounting Act may differ from the measurement rules in IFRS (International Financial Reporting Standards)
- Exercise critical thinking when assessing corporate earnings and financial position and understand why accounting figures may be affected
- Understand the need for financial information to be supplemented with non-financial information (sustainability reporting)
- The purpose, content and function of financial statements
- Users of financial statements
- The regulation surrounding financial statements
- What are accounts and accounting?
- Transactions and the balance sheet equation
- Transactions and the accounting system (the principle of double-entry bookkeeping)
- Closing of accounts: from the list of ledger balances to the income statement and the balance sheet
- Fundamental accounting principles
- Measurement of assets and debts
- The cash flow statement
- The accounts as a source of information
- Time series analyses and cross section analyses of profitability, cash flow, solidity and financing.
The course is lectured/supervised over 14 weeks. The lectures are used for structure and framing of the academic content in line with the course's learning outcomes. These sessions are supported by videos that review selected issues. Specific examples of how accounting issues are solved are emphasized.
Students are responsible for participating in the teaching with questions, comments and discussion.
Solving tasks where the principles are applied is crucial for understanding the subject. Solving assignments takes place in lectures and through independent work. Parts of the assignment solution require students to use Excel.
A number of tests that are automatically corrected are available on itslearning. These are well suited to prepare students for how the questions can be asked on the exam.
E-Learning
Where the course is delivered as an online course, the lecturer will, in collaboration with the study administration, arrange an appropriate combination of digital learning resources and activities. These activities will correspond to the stated number of teaching hours delivered on campus. Online students are also offered a study guide that will provide an overview of the course and contribute to course progression. The total time students are expected to spend completing the course also applies to online studies.
As of the academic year 2021/2022, mid-semester evaluation is introduced in the course, counting 30% of the exam grade, and the final exam will count 70%. Both the mid-semester exam and the final exam must be passed in order to obtain a final grade in the course.
Mandatory coursework requirements no longer apply for re-sit.
Higher Education Entrance Qualification
Disclaimer
Deviations in teaching and exams may occur if external conditions or unforeseen events call for this.
BØK 3422 Managerial Accounting, BØK 3434 Managerial Accounting and finance, BØK 1113 Managerial Accounting or similar.
| Assessments |
|---|
Exam category: Submission Form of assessment: Structured Test Exam/hand-in semester: First Semester Weight: 30 Grouping: Individual Duration: 90 Minute(s) Comment: Both the mid-semester exam and the final exam must be passed, in order to obtain a final grade in the course. Exam code: BØK35322 Grading scale: ECTS Resit: Examination every semester |
Exam category: School Exam Form of assessment: Structured Test Exam/hand-in semester: First Semester Weight: 70 Grouping: Individual Support materials:
Duration: 3 Hour(s) Comment: Both the mid-semester exam and the final exam must be passed, in order to obtain a final grade in the course. Exam code: BØK35323 Grading scale: ECTS Resit: Examination every semester |
All exams must be passed to get a grade in this course.
| Activity | Duration | Comment |
|---|---|---|
Teaching | 46 Hour(s) | Lectures with problem solving. Some of the lectures will be digital. |
Prepare for teaching | 56 Hour(s) | Working with textbook and online lectures. |
Feedback activities and counselling | 6 Hour(s) | Review of the mid-term evaluation. |
Student's own work with learning resources | 65 Hour(s) | Individual work with recommended exercises. |
Examination | 31 Hour(s) | Preparing for exam |
A course of 1 ECTS credit corresponds to a workload of 26-30 hours. Therefore a course of 7,5 ECTS credit corresponds to a workload of at least 200 hours.