GRA 6223 Valuation and Fair Value Accounting
GRA 6223 Valuation and Fair Value Accounting
Valuation is an important task for research analysts, investment bankers, auditors and accountants, corporate finance specialists, merger and acquisition analysts, venture capitalists, and individual investors. This course provides both a sound theoretical framework for valuation and a thorough discussion of how valuations are actually done in the real world.
Development of valuation skills entails understanding the concepts and procedures underlying generally accepted accounting principles used to prepare financial information.
The objective of the course is twofold. First, students shall acquire general knowledge about techniques to estimate the market value of assets and businesses (valuation methods). Second, they shall learn about the topics for which firms are required to report the fair value of balance sheet items and learn how to apply the valuation methods for that purpose.
After completing the course, students will be able to:
- Carry out valuation of assets and businesses using the most common valuation methods, discounted dividend valuation, free cash flow valuation and market-based valuation.
- Prepare correctly the financial statements with respect to topics for which fair value accounting is required.
The course will help the students to evaluate the market prices of stocks and other assets, and to extract the assumptions the market is implicitly making given those prices. The student will be in a position to critically evaluate those assumptions and analyse to what extent changes in these affect the stock price. The students will also learn to judge critically the usefulness of fair value information in the financial statements.
1. Fundamental analysis – the process
2. The reformulation of the income statement and balance sheet
3. Forecasting.
4. Introduction to industry and company analysis.
5. Cost of capital
6. Valuation techniques
Discounted dividend valuation
DCF valuation
Relative valuation
7. Acquisition analysis
8. Valuation in accounting
Fair value measurement – IFRS 13
Revaluation of PP&E – IAS 16
Measurement of recoverable amounts – IAS 36
Investment property – IAS 40
Biological assets – IAS 41
9 Auditing fair value estimates – ISA 540
GRA 6223 is a course that ordinarily runs each spring semester. An additional (alternative) exam is held in august/september each. To prepare for the additional exam, students have access to video lectures. A whole-day seminar (6 hours) with exercises and opportunity to raise questions, will be held.
Please note that while attendance is not compulsory in all courses, it is the student’s own responsibility to obtain any information provided in class that is not included on itslearning or text book.
All courses in the Masters programme will assume that students have fulfilled the admission requirements for the programme. In addition, courses in second, third and/or fourth semester can have specific prerequisites and will assume that students have followed normal study progression. For double degree and exchange students, please note that equivalent courses are accepted.
| Assessments |
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Exam category: Submission Form of assessment: Written submission Weight: 30 Grouping: Group (1 - 3) Duration: 1 Week(s) Exam code: GRA 62231 Grading scale: ECTS Resit: Examination when next scheduled course |
Exam category: Submission Form of assessment: Written submission Invigilation Weight: 70 Grouping: Individual Support materials:
Duration: 3 Hour(s) Comment: GRA 6223 is a course that ordinarily runs each spring semester. An additional (alternative) exam is held in august/september each year. Exam code: GRA62232 Grading scale: ECTS Resit: Examination when next scheduled course |
All exams must be passed to get a grade in this course.
A course of 1 ECTS credit corresponds to a workload of 26-30 hours. Therefore a course of 6 ECTS credits corresponds to a workload of at least 160 hours.
GRA 6223 is a course that ordinarily runs each spring semester. An additional (alternative) exam is held in august/september each year.