ELE 3735 Financial Accounting

ELE 3735 Financial Accounting

Course code: 
ELE 3735
Department: 
Accounting and Operations Management
Credits: 
7.5
Course coordinator: 
Janicke Rasmussen
Tonny Stenheim
Course name in Norwegian: 
Finansregnskap
Product category: 
Bachelor
Portfolio: 
Bachelor - Electives
Semester: 
2024 Spring
Active status: 
Active
Level of study: 
Bachelor
Teaching language: 
Norwegian
Course type: 
One semester
Introduction

Firms may choose from different accounting languages and dialects in Norway. The main alternatives are GRS (God RegnskapsSkikk = good accounting practice in Norway) and IFRS (International Financial Reporting Standards). Within each of these alternatives there are dialects. All listed companies must apply IFRS, other companies may choose freely between the main alternatives. Some companies may also choose between the dialects. This means that firms may calculate revenue, expenses, assets, liabilities and equity using five different set of rules.

The diversity in how to calculate accounting numbers is a challenge to both preparers and users. Preparers must know which set of rules to apply and how to apply the accounting standards and valuation methods that belong to the chosen set of rules. Users must know how to interpret figures prepared under different set of rules in order to make informed decisions.

The aim of this course is to provide users and prepares with the knowledge that enables them to navigate correctly in an environment with different ways to measure revenue, expenses, assets, liabilities and equity. The course will put particular emphasis on GRS since 99 % of all Norwegian firms use GRS. However, since the largest firms (including listed firms) use IFRS, the course will also cover key differences between GRS and IFRS.

Learning outcomes - Knowledge

Students should be able to:

  • Understand how different languages of accounting (GRS and IFRS) influence how elements in the financial accounts are valued and presented. 
  • Understand the difference between company accounting and group accounting and how they should be presented in order to be used in decision making for relevant stakeholders 
  • Understand how financial accounts can be assess in a quality context
Learning outcomes - Skills

Upon completion of the course, students should be able to:

  • Compare and contrast income-based and balance sheet-based accounting models
  • Use the fundamental accounting principles (income based and balance sheet based accounting) to find solutions to accounting problems
  • Prepare individual accounts for non-listed Norwegian firms using GRS
  • Prepare consolidated statements using the purchase method.
  • Give example of main differences between GRS and IFRS
General Competence

Upon completion of the course, students should be able to discuss accounting issues in light of both revenue-based and balance sheet-based accounting models, and analyse the pros and cons of GRS and IFRS.

Course content
  • The regulation of the obligation to prepare financial statements in Norway
  • How to measure net income? Revenue-based and balance sheet-based accounting models, GRS vs. IFRS and accounting models based on fair value and historical cost.
  • How should we understand and interpret the fundamental accounting principles in GRS?
  • General GRS-rules for recognition and measurement of assets and debt (balance) 
  • Special issues with GRS, e.g. amortized cost, leasing, pensions, factoring, deferred taxes, employee options and revenue recognition (further information will be given during the course).
  • Recognition and measurement according to IFRS, e.g. accounting for investment property, biological assets (e.g. farmed fish and forest) and property, plant and equipment (further information will be given at during the course).
  • Group accounting
  • Accounting and earnings quality.
Teaching and learning activities

The course consists of 40 hours of lectures and assignment reviews. Further information will be given at the start of the course.

It is assumed that students have access to a spreadsheet program and Internet.

Software tools
No specified computer-based tools are required.
Additional information

For electives re-sit is normally offered at the next scheduled course. If an elective is discontinued or is not initiated in the semester it is offered, re-sit will be offered in the electives ordinary semester.

Qualifications

Higher Education Entrance Qualification

Disclaimer

Deviations in teaching and exams may occur if external conditions or unforeseen events call for this.

Required prerequisite knowledge

Financial Accounting and Financial Statement Analysis ((BØK 3531 or 3532) or similar.

Assessments
ExamWeightInvigilationDurationSupport materialsGroupingComment
Exam category
Submission
Form of assessment
Written submission
Exam code
ELE37352
Grading scale
ECTS
Grading rule
Internal examiner
Resit
Examination when next scheduled course
30
No
2 Week(s)
Group/Individual (1 - 3)
Midterm Evaluation. This is the first of two exam elements, which is a home exam. It will test the student's reflectivity with regard to conceptual substance. All exams must be passed to obtain a final grade in the course.
Exam category
Submission
Form of assessment
Written submission
Exam code
ELE37353
Grading scale
ECTS
Grading rule
Internal examiner
Resit
Examination when next scheduled course
70
No
3 Hour(s)
Individual
This is a final home exam with an emphasis on the subject's technical content.
All exams must be passed to receive a final grade in the course.
Type of Assessment: 
Ordinary examination
All exams must be passed to get a grade in this course.
Total weight: 
100
Reduction description

The course is overlapping with BØK 3647 Financial Accounting, 15 credits which belongs to the specialisation in accounting, offered in the Bachelor programme Business Administration, 3rd year. Students planning to take the specialisation in accounting should therefore not take this course.

Student workload
ActivityDurationComment
Teaching
40 Hour(s)
Lectures incl. reviews of assignments.
Student's own work with learning resources
120 Hour(s)
Examination
40 Hour(s)
Preparations incl. exam.
Sum workload: 
200

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.