GRA 6223 Valuation and Fair Value Accounting

GRA 6223 Valuation and Fair Value Accounting

Course code: 
GRA 6223
Department: 
Accounting and Operations Management
Credits: 
6
Course coordinator: 
Erlend Kvaal
Akram Khalilov
Course name in Norwegian: 
Valuation and Fair Value Accounting
Product category: 
Master
Portfolio: 
Master of Accounting and Auditing
Semester: 
2023 Autumn
Active status: 
Re-sit exam
Level of study: 
Master
Resit exam semesters: 
2023 Autumn
Teaching language: 
English
Course type: 
One semester
Introduction

Various categories of professionals need to carry out valuations to support business decisions. Among those are research analysts, investment bankers, auditors and accountants, corporate finance specialists, merger and acquisition analysts, venture capitalists, and individual investors. This course provides a sound theoretical framework for valuation of assets and entities and a practical guide to how valuations are actually done in the real world. It also provides a conseptual and practical introduction to fair value accounting ander IFRS.

Valuation skills are also required for understanding the concepts and procedures underlying generally accepted accounting principles used to prepare financial information.

Learning outcomes - Knowledge

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.

Learning outcomes - Skills

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 reporting that involves fair value measurement.
General Competence

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.

Course content
  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. Fair value accounting in IFRS, e.g.
    • Fair value measurement – IFRS 13
    • Purchase price allocation - IFRS 3
    • Revaluation of PP&E – IAS 16
    • Measurement of recoverable amounts – IAS 36
    • Financial instruments - IFRS 9 and IAS 32
    • Fair value for non-financial assets - IAS 40 & 41
Teaching and learning activities

The course GRA 6223 ordinarily ran each spring semester. An additional (alternative) exam was held in august/september each year. 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.

Last retake of this course is spring 2024.

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.

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

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. 

Qualifications

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.

Disclaimer

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

Assessments
ExamWeightInvigilationDurationSupport materialsGroupingComment
Exam category
Submission
Form of assessment
Written submission
Exam code
GRA 62233
Grading scale
ECTS
Grading rule
Internal examiner
Resit
Examination every semester
50
No
1 Week(s)
Group (1 - 3)
There will be a retake for GRA 6223 in autumn 2023, with the last retake spring 2024.
Exam category
Submission
Form of assessment
Written submission
Exam code
GRA 62234
Grading scale
ECTS
Grading rule
Internal and external examiner
Resit
Examination every semester
50
No
3 Hour(s)
Individual
There will be a retake for GRA 6223 in autumn 2023, with the last retake spring 2024.
25/01/2023 The form of the exam has changed from individual school exam to individual home exam in spring 2023.
Type of Assessment: 
Ordinary examination
All exams must be passed to get a grade in this course.
Total weight: 
100
Sum workload: 
0

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.