Analyzing Beyond the Numbers

Overview/Description
 This course will familiarize business managers, financial professionals, and other business professionals with methods to extend their analysis of financial statements beyond the three basic reports: the Balance Sheet, Income Statement, and Cash Flow Statement. The course begins by examining how the CPA can address credibility issues, primarily through the auditing process. The course examines how footnotes can contribute to an analysis of financial statements. The course will focus on how to analyze two accounting features often identified in footnotes: the cost of goods sold measurement and depreciation methods.

Target Audience
 This series is targeted specifically for business managers, financial professionals, and other business professionals who have the need to understand financial statements.

Expected Duration
3 hours

Lesson Objectives:

Credibility Issues

  • recognize the importance of a credible financial report.
  • identify the primary indicators of a credible financial report.
  • identify the type of audit opinion expressed, based on the credibility of a financial report.
  • identify the role of disclosure in analyzing financial statements.
  • identify the accounting approach of a company, based on trends within a financial report.

    • Notes to Financial Statements

  • recognize the benefit of having notes to financial reports.
  • determine if specific items of disclosure must appear in the financial reports.
  • identify the additional disclosure information that should appear in the notes to the financial statement.

    • The Cost of Goods Sold Measurement

  • recognize the effects of methods used to measure the cost of goods sold expense have on the numbers in a financial statement.
  • identify the attributes of using the FIFO accounting method.
  • identify the implications of the LIFO accounting method.
  • identify the attributes of the average cost method of expensing cost of goods sold.

    • Depreciation Methods

  • recognize the importance of knowing the depreciation method used in a financial statement.
  • calculate straight line depreciation.
  • calculate declining balance depreciation.

    • Course Number: FIN0115