Insegnamento a.a. 2021-2022

Classes: 25 (II sem.)

Instructors:
Class 25: CLAUDIA IMPERATORE

Accounting is the language of business as it measures economic activity for decision-making. Financial statements are a key product of such measurement process and they play a key role in the communication between the company and business parties. External information users, such as investors, financial analysts and banks, use accounting information disclosed in financial statements to make their decisions and evaluations. Given that, it is important to understand key accounting concepts and principles according to which financial statement are prepared. The mission of this course is to provide the basic skills necessary to understand, prepare and analyze financial statements helping students become informed users of financial statements.

The most important topics that will be covered during the course are the following:

- General accounting: double entry and accrual accounting systems basics

- Accounting representation of operating (i.e., revenues, accounts receivable, cost of goods sold and inventories) and investing activities (i.e., property, plant and equipment as well as intangible assets).

- Accounting representation of transactions relative to debt, bonds, equity and dividend payment.

- Accounting representation of investment in other corporations.

- Preparation of financial statements (balance sheet, income statement and cash flow statement);

- Basic analysis of financial statements to assess firms’ performance and financial position.

At the end of the course student will be able to...

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

- Understand the basic accounting concepts and key accounting principles;

- Understand the overall general accounting process from which the individual financial statements arise as well as the relation between accounting data and the underlying economic events generating them.

- Understand the rationale for the different accounting methods and the measurements that underline financial statements;

- Awareness of the judgement involved and discretion allowed in accounting choices and estimates.

- Recognize key elements in financial statements and analyze them for making investment, credit and other evaluation decisions.

At the end of the course student will be able to...

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

- Apply the double entry system to report accounting transactions as prescribed by general accounting rules (mainly by U.S. GAAP);

- Use accounting terminology to represent business transactions.

- Read and prepare basic financial statements.

- Analyze the accounting information presented in financial statements and apply effective analytic skills and tools to make business decisions or solve problems.

• Face-to-face lectures
• Exercises (exercises, database, software etc.)
• Case studies /Incidents (traditional, online)

The learning experience of this course includes face-to-face lectures, case discussions and real examples. Kellogg’s Annual Report will be used throughout the course to provide context to the concepts we will cover. In addition to Kellogg’s, several real examples will be used in class to facilitate the learning experience, illustrate how firms deal with accounting issues in reality and explore firms’ disclosure strategies. By using real financial statements, students will also learn how to read annual reports and identify relevant information in a long and often hard-to-read document. As properly dealing with large volumes of written material is a key skill in the business world nowadays, enhancing students’ ability to handle a large amount of information and sift through it will be useful in their future career.

Moreover, in additional to traditional exercises, students will use Excel to prepare journal entries as well as financial statements. The usage of Excel will facilitate their understanding of the accounting system and interconnections among accounting journal, ledger and financial statements. In addition, it will help students to develop their peculiar programming skills in relation to accounting issues. The ability of applying programming skills to business problems is crucial in today’s business world where coding and programming represent the new language of business.

Lastly, the course will foster active participation and discussion thus triggering students’ use of their communication skills to debate on technical issues.

	Continuous assessment	Partial exams	General exam
Written individual exam (traditional/online)		x	x
Individual assignment (report, exercise, presentation, project work etc.)		x

Attending students:

The students can choose between two options:

• The first option is to take two written exams. Each partial exam represents 50% of the final grade. Hence, the final grade is an equally-weighted average of the two partials. In order to pass the exam, the student has to pass each partial. The first partial will cover the first part of the course and will be based on a mix of multiple choices and exercises. The exercises will require the preparation of journal entries and income statement. The second partial will also be based on a mix of multiple choices and exercises. In this case exercises will require the preparation of journal entries, cash flow statement , balance sheet as well as financial statement analysis. The purpose is to verify: i) student’s learning level of the main concepts showed in the course; ii) student’s ability to apply fundamental accounting principles and prepare main financial statements; iii) student’s ability to read and analyze financial statements in a critical way.
• The second option is to take only a final written exam. The final written exam is a combination of the two partials described above. Hence, it is based on a mix of multiple choices and exercises relative to topics covered in class where computations and open questions are combined.

In addition, during the course tests to get additional points will be scheduled. As practice and continuous study are fundamental to properly learn and digest accounting concepts, the goal of the tests is to incentivize students to study on a regularly basis and identify potential gaps in their preparation. The additional points will then be added to the final grade.

Non attending students:

• The assessment of non-attending students is entirely based (100% of the final grade) on the final written exam, which has the same content as the one applied to attending students.

The main course material, for both attending and non-attending students, is:

- Financial Accounting, International Edition, Libby, Libby, Short. McGraw-Hill, 2013 (9th edition).

The textbook is not mandatory but highly recommended. In addition to the textbook, slides, teaching handouts and other materials (i.e., academic articles, newspaper articles, exercises and useful links, etc.) will be provided during the course. Students will need to refer to the Blackboard platform.