ANALYSING FINANCIAL STATEMENTS


Analysing Financial Statements (DAFS2000)

 

Tutor: Mr N.P. Uzera

STATEMENT ABOUT ACADEMIC HONESTY AND INTEGRITY

 

All students, upon signing this course outline, commit themselves to abide by the policies and rules of the institution. The core activity of ABN is learning and in this respect academic honesty and integrity is very important to ensure that learning is valid, reliable and credible.

 

ABN therefore does not condone any form of academic dishonesty, including plagiarism and cheating on exams and assessments, amongst other such practices. ABN requires students to always do their own assignments and to produce their own academic work, unless given a group assignment.

 

Academic Dishonesty includes, but is not limited to:

  • Using the ideas, words, works or inventions of someone else as if it is your own work.
  • Using the direct words of someone else without quotation marks, even if it is referenced.
  • Copying from writings (books, articles, webpages, other students’ assignments, etc.), published or unpublished, without referencing.
  • Syndication of a piece of work, all or part of an assignment, by a group of students, unless the assignment was a legitimate group assignment.
  • The borrowing and use of another person’s assignment, with or without their knowledge or permission.
  • Infringing copyright, including documents copied or cut and pasted from the internet.
  • Asking someone else to prepare an assignment for you or to write or sit an assessment for you, whether this is against payment or not.
  • Re-submitting work done already for another course or programme as new work, so-called self-plagiarism.
  • Bringing notes into an examination or test venue, regardless of whether the notes were used to copy or not.
  • Receiving any outside assistance in any form or shape during an examination or test.

 

All forms of academic dishonesty are viewed as misconduct under ABN Student Rules and Regulations. Students who make themselves guilty of academic dishonesty will be brought before a Disciplinary Committee and may be suspended from studying for a certain time or may be expelled. All students who are found guilty of academic dishonesty shall have an appropriate endorsement on their academic record, which will never be erased.

 

 

 

 

 

 

 

COURSE INFORMATION

COURSE CODE AND TITLE:  Analysing Financial Statements (DAFS2000)

 

COURSE DESCRIPTION:

 

The aim of this course is to explain the concept of financial reporting, importance and use of the financial ratios in the analysis of business performance. This course will further illustrate how financial ratios are computed based on financial statements and the interpretation thereof and it will recommend corrective actions that the management must implement in order to improve the business performance.

 

NQF Level: 6

CREDITS:

PREREQUISITES: None

EXIT Learning Outcomes:

 

Upon successful completion of this course, students will be able to:

 

1.       Understand the importance of financial reporting

2.       Read the financial statements in order to quantify the business performance.

3.       Compute and interpret various ratios.

4.       Know the corrective actions to take when the financial performance is unsatisfactory.

 

PRESCRIBED TEXT BOOK:

  • Gitmann, LJ (2011). Principles of Managerial Finance. Global and South African Perspective. Pearson, ISBN 987-177025-502-9

 

OTHER READING MATERIALS:

·         Marx, J (2009). Finance for Non-Financial Managers, 2nd Ed. Pretoria, South Africa, Van Schaik Publishers.

 

·         Atrill, P., Mclaney, E. (2011). Accounting and Finance for Non-Specialists (7th Ed.) Pearson Education Limited.

 

Web Sites:

 

 

               

 

 

 

 

 

 

 

 

 

 

 

Course Content

 

1.       Financial Statement Analysis: An overview

1.       Importance of Financial Reporting

2.       Importance of Financial Ratios

3.       Financial ratio Classification

4.       Stakeholders interest and Uses of ratios

5.       Ratio analysis

2.       Reading Financial Statements

1.       Importance of Financial Statement Analysis

2.       Reading financial statements

3.       Importance of profitability ratios

3.       Income Statement Analysis

1.       Defining the Income Statement

2.       Reading financial statements

3.       Importance of activity ratios

4.       Analysing Balance sheets

1.       Defining Balance Sheet

2.       Reading financial statements

3.       Liquidity ratios

5.        Using Debt ratios to analyse financial performance

1.       Reading financial statements

2.       Importance of the debt position of a firm

6.       Calculations and interpretation of profitability ratios

1.       Reading financial statements

2.       Analyzing the financial performance of a firm

3.       Calculation of the performance ratios

4.       Assessing the financial performance based on profitability ratios

5.       Quantifying the financial performance based on profitability ratios

7.       Calculations and interpretation of efficiency ratios

1.       Reading financial statements

2.       Calculation of the efficiency ratios

3.       Assessing the financial performance based on efficiency ratios

4.       Quantifying the financial performance based on efficiency ratios

8.       Calculations and interpretation of liquidity ratios

1.       Reading financial statements

2.       Calculation of the liquidity ratios

3.       Assessing the financial performance based on liquidity ratios

4.       Quantifying the financial performance based on liquidity ratios

9.       Calculations and interpretation of gearing ratios

1.       Reading financial statements

2.       Calculation of the gearing ratios

3.       Assessing the financial performance based on gearing ratios

4.       Quantifying the financial performance based on gearing ratios

10.   Calculations and interpretation of gearing ratios

1.       Reading financial statements

2.       Calculation of the security market ratios

3.       Assessing the financial performance based on security market ratios

4.       Quantifying the financial performance based on security market ratios

 

 

IMPORTANT DATES:

NOTE: The following dates are subject to change based on the needs of the students at the lecturer’s prerogative. Students will be notified ahead of time of any changes.

 

Due Date(s)

Important Information

 24 March 2020

Assignment 1

  14 April 2020

Assignment 2

  24 August 2020

Assignment 3

15 September 220

Assignment 4

 

ASSESSMENT AND EVALUATION: Continuous assessment 50%

                                                           Examination 50%; 1 x 3 hour examination paper

 

Minimum pass requirement for this course: 50%

COURSE POLICIES

General Academic Policies:

It is the student's responsibility to be familiar with and adhere to ABN’s Policies.

 

AUTHORISATION:

This course is authorised for use by:

 

 

___________________________________ __________________________
Head of Department                                                                                                                                      Date

 

­­­­ACKNOWLEDGEMENT BY STUDENT

 

(To be completed by all students on the course, detached from the course outline and kept on record in the department)

 

I, ____________________________(insert name), ______________________(Student number), hereby acknowledge that I have received this course outline for (insert course title and code), and that I have familiarised myself with its content, in particular the statement about academic honesty and integrity. I agree to abide by the Policies and arrangements spelt out in this course outline.

 

 

 

______________________                                                                                                    _______________________

Signature of Student                                                                                                                      Date