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25410 Corporate Financial Analysis (Capstone)

Warning: The information on this page is indicative. The subject outline for a particular session, location and mode of offering is the authoritative source of all information about the subject for that offering. Required texts, recommended texts and references in particular are likely to change. Students will be provided with a subject outline once they enrol in the subject.

Subject handbook information prior to 2018 is available in the Archives.

UTS: Business: Finance
Credit points: 6 cp

Subject level:

Undergraduate

Result type: Grade and marks

Requisite(s): 25557 Corporate Finance: Theory and Practice
These requisites may not apply to students in certain courses.
There are course requisites for this subject. See access conditions.

Description

This subject examines the use of financial statements in assessing a firm's financial health, its strengths, weaknesses, recent performance and future prospects. It examines financial statement forecasting and modelling with an emphasis on cash flow reconstructions from financial statements. Special issues dealing with financial statement information are emphasised in some depth. These issues include: market efficiency, asset pricing, corporate restructuring and business valuation, debt ratings and financial distress.

Subject learning objectives (SLOs)

Upon successful completion of this subject students should be able to:
1. analyse financial statements in context and supported by qualitative research
2. construct financial statements for financial forecasting and modelling
3. analyse financial and non-financial data relevant for credit and investment decisions
4. evaluate the financial risks faced by a firm and its level of financial distress
5. combine the elements above to value a business

Course intended learning outcomes (CILOs)

This subject also contributes specifically to the following program learning objectives:

  • Critically analyse relevant concepts to understand practice in business and related professions in a global workplace (1.1)
  • Demonstrate inter-relationships between differing business and related disciplines (1.2)
  • Locate and critically evaluate relevant data and literature to address business problems through a research approach (2.1)
  • Apply critical and creative thinking to address issues in business (2.2)
  • Convey information clearly and fluently in high quality written form appropriate for their audience (3.1)
  • Use oral communication appropriately to convey information clearly and fluently (3.2)
  • Critically analyse business decisions in terms of ethical practice and social responsibility (4.1)
  • Critically analyse sustainability principles for various stakeholders in relation to business contexts (4.2)
  • Apply technical and professional skills necessary to operate effectively in business and related professions (5.1)

Contribution to the development of graduate attributes

The subject contributes to the aim of preparing students to commence a fulfilling and effective career in business, especially in finance professions. It draws on the learning outcomes from accounting, economics, finance and quantitative methods in its study of corporate financial statements and reports and their use in 'real world' financial analysis.

This subject contributes to the development of the following graduate attributes:

  • Business knowledge and concepts
  • Critical thinking, creativity and analytical skills
  • Communication and interpersonal skills
  • Attitudes and values
  • Business practice oriented skills

Teaching and learning strategies

This subject uses a combination of learning strategies to achieve subject and program learning objectives.

1. Preparation for Learning in Advance of Lectures and Tutorials

The subject uses readings tailored to each topic area each week where students are required to read the material in advance since both the lecture and tutorial build on the areas covered in the readings.

2. Lectures

Lectures cover topics through examples and then students are requested to answer questions in class to determine comprehension levels and provide immediate feedback and increased information if the comprehension level is not achieved.

3. Active Learning through Tutorial Discussions

Students are asked to prepare assigned tutorial questions in advance so tutorials include in-class discussion about the answers.

4. Case Scenarios in Assignments

Students are provided with case studies to develop professional responses to realistic situations and to develop critical thinking in a group work situation.

5. Online Discussions

Students are directed to use the online discussion board to lodge questions, provide suggested answers and debate solutions to engage in debate and develop confidence with the material.

6. Oral Presentations

Students work in groups to work on assignments then individually present within each group to the tutorial classes. This situation simulates real world presentations and feedback is provided to improve public speaking.

7. Feedback

Feedback is provided for the first part of the group assignment, in advance of the second part being released, so that students can improve their delivery before beginning the second part. This feedback comprises a detailed feedback form that provides a mark and comments for each of the areas covered in the assignment. For the second part of the assignment, there is an individual oral presentation, and each student is given an evaluation sheet that focuses on their presentation techniques and gives recommendations for improvement.

Content (topics)

  • Financial information, disclosure regulation and market efficiency;
  • Analysis of financial statements;
  • Reliability and quality of financial information;
  • Reformulation and reconstruction of financial statements;
  • Financial analysis for credit and investment decisions;
  • Valuation analysis for new and existing business;
  • Risk analysis, debt rating and financial distress modelling.

Assessment

Assessment task 1: Written Assignment (Group)

Objective(s):

This addresses subject learning objective(s):

1, 3 and 4

Weight: 30%
Criteria:

Assignments will be graded based on the correctness of their results, the quality of their arguments, and the overall quality of their presentation.

No late assignments will be accepted.

Assessment task 2: Oral Presentation (Individual)

Objective(s):

This addresses subject learning objective(s):

5

This addresses program learning objectives(s):

3.2

Weight: 10%
Criteria:

Presentations will be graded based on the presenter’s level of preparation, their ability to communicate clearly and address the topic, and the correctness of their results.

No late submissions will be accepted.

Assessment task 3: Final Exam (Individual)

Objective(s):

This addresses subject learning objective(s):

1, 2, 3, 4 and 5

This addresses program learning objectives(s):

1.1, 1.2, 2.1, 2.2, 3.1, 4.1, 4.2 and 5.1

Weight: 60%

Minimum requirements

Students must achieve at least 50% of the subject’s total marks.

Required texts

All reading material will be provided on UTS Online in pdf format.

Recommended texts

The following text is recommended:

Wahlen, Baginski and Bradshaw, Financial Reporting, Financial Statement Analysis and Valuation, 8th ed., 2015, Cengage Learning.

Two versions of the text are available:

  • Hard Print - Wahlen/Baginski/Bradshaw Financial Reporting, Financial Statement Analysis and Valuation [8th © 2015]9781285190907
  • EBOOK - Wahlen/Baginski/Bradshaw Financial Reporting, Financial Statement Analysis and Valuation [8th © 2015]9781285190907

References

All lecture overheads will be available on UTS online.

Other resources

Faculty of Business, Guide to Writing Assignments (available through UTSOnline or: www.uts.edu.au/node/50946 )