Objectives

• By the end of the program, participants will be able to:
• Apply the framework of financial statements analysis.
• Demonstrate skills at the foundations of ratio and financial analysis.
• Carry out company and industry analysis.
• Implement the process of company evaluation and analysis.
• Analyze real-life financial statements from companies traded on the world and GCC stock exchanges.

The Contents

Financial Statements and Business Decisions

• Accounting and Financial Systems
• Four Key Financial Statements
• Relationship among the Financial Statements
• Management Uses of Financial Statements
• Essential Notes to the Financial Statements

Financial Statement Analysis: An Introduction

• Role of Financial Reporting and Analysis
• The Core Financial Statements and the Importance of the Annual Report
• The Important Role of Notes and Supplementary Information
• Objective and Types of Audits of Financial Statements
• Financial Statement Analysis Framework
• The Accounting Cycle
• Financial Reporting Mechanics
• Relationship, Elements and Classification of Financial Statements

Financial Reporting Standards

• Importance of Reporting Standards in Security Analysis and Valuation
• The Standards Setting Bodies
• International Financial Reporting Standards versus Generally Accepted Accounting Principles

Understanding Financial Statements

• Income Statement Components
• Revenue and Expense Recognition
• Balance Sheet Components:
• Measurement and Classification
• Cash Flow Statement:
• Operating, Investing, and Financing Activities
• Direct versus Indirect Methods in Cash Flow Preparation

Financial Analysis Techniques

• Ratio Analysis:
• Liquidity: Current, Quick, and Cash Ratios
• Asset Management and Activity Ratios
• Solvency: Debt, Equity, and Times Interest Earned Ratios
• Profitability: Profit Margin, Gross Margin, Return on Assets, Return on Equity
• Market and Valuation: Price-Earnings and Earnings Per Share Ratios
• Vertical Analysis and Strategy: Balance Sheet and Income Statement Approaches
• Trend Analysis and Growth
• DuPont Analysis: The Three-Step and Five-Step Models
• Time-Series and Cross-Sectional Analysis
• Limitation of Ratio Analysis

Financial Statement Analysis: Applications and Presentations

• Evaluating a Company’s Past Performance
• Comprehensive Real-Life Analysis of Publicly Traded Companies