Saintgits Institute of Management

Master of Business Administration (MBA)

Trimester IV, Batch 2016-2018
Course No: FIN-T4-6 Financial Statement Analysis (FSA)

Course Plan

Name of the Faculty: Jinomol P

Email-id : Jinomol.p@saintgits.org
Mobile no. 9895142914

Programme Outcomes (POs):

Our graduates will
PO 1: Analyze and apply knowledge of management principles and business practices to
solve challenging problems.
PO 2: Organize information and use appropriate tools and techniques to assess the facts
and identify business problems.
PO 3: Develop alternatives and make quick and feasible decisions.
PO 4: Think independently, be open to diverse views and act in ways that benefit society.
PO 5: Be trustworthy and fair in all their dealings.
PO 6: Express willingness and enthusiasm to accept responsibilities, learn from mistakes
and face adversity with confidence.
PO 7: Present ideas orally and in writing, in an effective and persuasive manner, in
personal, professional and community settings, using modern technologies.
PO 8: Participate effectively in group activities, nurture relationships within the group
and take leadership roles.
PO 9: Develop commitment to continuous acquisition of new knowledge and skills.
PO 10: Demonstrate the ability to carry himself / herself appropriately in demanding
situations.

Significance of the Financial Statement Analysis course

Analysis and interpretation of the financial statements is very important for making
decisions by the interested users. The skill of analyzing the financial statements in
the correct manner will help you take right decisions on investment choices.

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Course Objectives
The aim of the course is to help the students analyze and interpret the
financial statements effectively for making important business decisions.
The objective is also to use this information to make forecasts and
evaluation of firms.

Expected Course Outcomes:

On completion of this course, it is expected that the students will:

1. Understand the importance of financial statement analysis
2. Identify the various techniques used in financial statement analysis
3. Apply the techniques of analyzing the financial statements of a company
4. Understand the importance of forecasting, valuation and modelling

Linkage of Expected Course Outcomes to Program O utcomes

PO1 PO2 PO3 PO4 PO5 PO6 PO7 PO8 PO9 PO10
Knowledge Problem Decision Leadership Communi- Positive Integrit Values Life- Behavior,
Solving making teamwork cation attitude y long Grooming
learnin
g
ECO1 3 1 1 1 1 1 1 1 2 1
ECO2 3 2 2 1 1 1 1 1 2 1
ECO3 3 3 3 3 1 1 1 1 2 1
ECO4 3 1 1 1 1 1 1 1 2 1
3= high, 2 Medium & 1 = low

Assessment of Expected Course Outcomes

SNo Assessment Method ECO1 ECO2 EC03 ECO4
1 Internal Examination 3 3 3 3
2 Assignment 2 2 2 2
3 Project & Presentation 1 1 3 1
4 End Semester University examination 3 3 3 3

The Code of Academic Behaviour

Students are expected to adhere to the Academic Conduct and Discipline mentioned in Students'
Handbook

Overall Teaching Methodology

The methodology followed will be lectures, problem solving, presentations, class

discussions, test papers and assignments.

Evaluation

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 Total Marks = 100 External evaluation = 60 & Internal evaluation = 40

Two internal examinations = 15

Assignment = 10
Project & Presentation = 15
The minimum internal marks requirement to become eligible to write the university exam is 45%
and university exam minimum requirement for pass in external marks is 45%.
Text Books

1. Pandey,I,M(2015) Financial Management Pg 581-601,Vikas Publishing House

Private Ltd
2. Sinha,Gokul (2012) Financial Statement Analysis , PHI Learning Private
Limited
3. Brigham,F,Eugene and Houston,F,Joel,(2012), Fundamentals of Financial
Management Pg 32-102, Thomson India Edition

Allocation of Sessions

Module 1 2 3 4 5 Total

Sessions
4 8 6 6 12 36
Allotted

Syllabus
FIN-T4-6- Financial Statement Analysis

Hours % of
Unit Topics allotted marks in
Financial statements- Balance sheet-Income Statements, Fund flow final
I statements-Uses of financial statements; Financial statement 4 10
analysis- Inter firm and intra firm analysis.

Techniques for Financial Statement Analysis-comparative financial

statements-common size financial statements-trend analysis- Percentages
II Ratio Analysis-Roles of Ratios in FSA; Analysis of FinancialStatements 8 25
through ratios-short term solvency analysis

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 First Internal Examination

Long term solvency analysis-profitability analysis-Activity analysis-

III DuPont Analysis, Cash flow analysis- cash flow statements-format and 6 20
presentation of cash flows

Forecasts and projections-Forecasting from book value-forecasting from

IV earnings and book value 6 15

Second Internal Examination

Forecasting from accounting rate of returns-forecasting profitability and
sales; analysis. Valuation and Modeling- Price to-book ratios and Price
V earnings ratio-Trading comparable analysis-Discounted cash flow 12 30
model(DCF)-Accounting book values-Free cash flow-Cost of
capital-Sensitivity
Final Examination

Session Plan

Session Main Topic for the Mod Teaching

Main Concepts Resources Remarks
No. session No Methodology

Introduction to Text 1:
Balance sheet and Ch: 24
1 financial I Lecture
Income statement Text 2:
statements Ch: 1
Uses o financial Text 1:
Uses of
statements Ch: 24
2 financial I Lecture
Text 2:
statements Fund flow
Ch: 1
statements
Text 1:
Financial Lecture &
Inter firm and Ch: 24
3-4 statement I problem
intra firm analysis Text 2:
analysis solving
Ch: 1
Techniques for II Text 1:
5-6 Introduction To Lecture
financial Ch: 25
Techniques for
statement Text 2:
financial
analysis Ch: 2
statement analysis
Comparative

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 balance sheets

Techniques for Text 1:

financial Common size Ch: 25 Problem
7 II
statement statements Text 2: solving
analysis Ch: 2
Techniques for Text 1:
financial Trend analysis Ch: 25 Problem
8 II
statement and percentages Text 2: solving
analysis Ch: 2
Text 1:
Introduction
Introduction to Ch: 25
ratio analysis Roles of ratio II Text 2: Problem
9-10
analysis in FSA Ch: 2 solving

Text 1:
Short term Liquidity ratios-
Ch: 25 Problem
solvency current ratio, II
11-12 Text 2: solving
analysis quick ratio and
Ch: 2
cash ratio

First Internal Examination

Text 1:
Long term
Solvency and Ch: 25 Problem
13 solvency III
profitability ratios Text 2: solving
analysis
Ch: 3
Text 1:
Long term
Ch: 25 Problem
14-15 solvency Activity ratios III
Text 2: solving
analysis
Ch: 3
Text 1:
Du Pont Ch: 25 Problem
16 Du Pont analysis III
analysis Text 2: solving
Ch: 3
Cash flow Text 1:
Cash flow statements Ch: 25 Problem
17-18 III
analysis Formats and Text 2: solving
presentation Ch: 3

Forecasts and Forecasts and Text 1:

19-20 IV Lecture
projections projections CH: 26

Forecasting IV Text 1:
Forecasting from CH: 26 Problem
21-22 from book
book value solving
value

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 Forecasting Forecasting from IV Text 1:
from earnings earnings and book CH: 26 Problem
23-24
and book value value solving

Second Internal Examination

Forecasting
Forecasting from Lecture &
from Text 1:
25-26 accounting rates V problem
accounting Ch 16
of returns solving
rates of returns
Forecasting Forecasting
Text 1:
Ch 16 Lecture &
27 profitability and profitability and V problem
sales sales solving
Price to-book Text 1:
Valuation and Ch 16 Lecture &
28-29 modelling
ratios and Price V problem
earnings ratio solving
Trading Text 1:
Valuation and Ch 16 Lecture &
30 modelling
comparable V problem
analysis solving
Text 1: DCF
Valuation and Discounted cash Ch 16 Lecture &
V valuation
31 modelling flow model(DCF) problem
of Coca-
solving
cola
Accounting Accounting book Text 1:
book values values Ch 16 Lecture &
32-33 V problem
solving
Free cash flow Free cash flow Text 1:
Ch 16 Lecture &
34-35 V problem
solving

Cost of Capital Cost of Capital Text 1: Lecture &

36 V problem
and sensitivity and sensitivity Ch 16
solving

Final examination

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 Project

Class will be divided into groups and will be assigned with a manufacturing company
each. Each group will have to do valuation of the company using Discounted Cash Flow
model.

Explanatory notes on Internal Evaluation

No Parameters Details Total

1 Internal Examination 2 exams(7.5 marks 15 marks
each)
2 Assignments 2 assignments (7.5 10 marks
Marks each)
3 Project 1 project 15 marks
TOTAL 40 marks

Feedback on achievement of Expected Course Outcome

FIN-T4-6- Financial Statement Analysis

Please mark on a 1 to 5 scale, where 1- represent the lowest level to 5 -represent for highest level of rating.

S.No Expected Course Outcome

1 2 3 4 5

I understand the importance of financial statement

1
analysis
I can identify the various techniques of financial
2
statement analysis
I can properly use the various techniques in financial
3
statement analysis
I know the importance of forecasting, valuation and
4
modeling in business

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