Fundamentals of Financial Reporting

Curriculum

• Introduction Free

  1 Lesson 3 Min

  In this introductory lesson, you will meet your instructor and get acquainted with the course structure and topics covered.

  What does the course cover Free
• Introduction to Financial Statements Analysis and Financial Reporting

  13 Lessons 73 Min

  In this section, we introduce the main financial statements and supplementary sources of information used in financial analysis. Next, we explain why auditors provide an opinion on published financial information and what the main types of audit reports are. Last but not least, we discuss the importance of setting financial reporting standards and examine the elements of the IASB Conceptual Framework for Financial Reporting.

  Introduction to Financial Reporting Free The Main Financial Statements Free Supplementary Sources of Financial Information Auditor's Reports Financial Statement Analysis The Financial Statement Analysis Framework The Importance of Financial Reporting Standards Standard-setting Bodies and Regulators The Conceptual Framework for Financial Reporting (Part 1) The Conceptual Framework for Financial Reporting (Part 2) Basics of Accounting General Requirements of Financial Statements Alternative Financial Reporting systems
• Understanding the Income Statement

  13 Lessons 96 Min

  This section of the financial reporting course is dedicated to the Income Statement. We explore and give examples of the main Income Statement items—gross and net revenue, Cost of Goods Sold (COGS), Selling, General and Administrative expenses (SG&A), payroll expenses, interest, taxes, and others. We show you how to calculate different levels of profitability, Earnings per Share (EPS), and Diluted Earnings per Share (DEPS). Last but not least, we examine the items that are included in the Other Comprehensive Income section.

  Components of the Income Statement Alternative Presentation Formats Revenue Recognition - Principles Revenue Recognition - Practical Applications Expense Recognition - Principles Expense recognition - Practical Applications Financial Reporting for Non-recurring Items Operating and Non- operating Components of the Income Statement Earnings per Share (EPS) Dilutive vs. Antidilutive Securities Common-size Income Statement The Income Statement - Ratio Analysis What is Other Comprehensive Income
• Understanding the Balance Sheet

  12 Lessons 88 Min

  Here, we cover in detail the main Balance Sheet elements - current and non-current assets and liabilities and shareholders’ equity. We explore different measurement bases of these elements (historical cost, current cost, fair value, etc.) and explain what a Common-Size Balance Sheet is. Lastly, we calculate and interpret some liquidity and solvency ratios.

  Components of the Balance Sheet The Balance Sheet - Alternative Presentation Formats Major Uses and Limitations of Balance Sheet Current Assets Non-current Assets Current Liabilities Non-current Liabilities Measurement Bases Shareholders' Equity Common-size Balance Sheet Liquidity Ratios Solvency Ratios
• Understanding the Cash Flow Statement

  13 Lessons 67 Min

  This section of the financial reporting course is dedicated to the specifics of the Cash Flow Statement. You will learn how to prepare a Cash Flow Statement using the direct and indirect methods and how to convert from one to the other. We also show you what a Common-Size Cash Flow Statement looks like and how to calculate the Free Cash Flow to the Firm (FCFF), Free Cash Flow to Equity (FCFE), and other cash flow ratios.

  Introduction to Cash Flow Statements Major Sections in the Cash Flow Statement How to Treat Non-cash Items IFRS vs. US GAAP - Cash Flow Direct vs. Indirect Method How is the Cash Flow Statement Linked to Other Financial Statements Constructing an Indirect Cash Flow Statement Constructing a Direct Cash Flow Statement Converting from the Indirect to Direct Method Cash Flows from Investing and Financing activities Common-size Cash Flow Statement Free Cash Flow Indicators Cash Flow Ratios
• The Importance of Financial Reporting Quality

  9 Lessons 43 Min

  Knowing the main elements in the core financial statements gives you a broader perspective of financial reporting. In this section of The Fundamentals of Financial Reporting course, we define the “quality” of financial reporting and introduce a spectrum for assessing it. Some of the other topics we cover in this section include Conservative vs. Aggressive accounting practices, the Fraud Triangle, and the typical accounting warning signs.

  What is Financial Reporting Quality Spectrum for Assessing Financial Reporting Quality Conservative vs. Aggressive Accounting Motivations for Low-quality Financial Reporting The Fraud Triangle Mechanisms that Discipline Financial Reporting Quality Presentation Choices Manipulations of Financial Results Accounting Warning Signs