Rutgers School of Business
Online MBA Financial Reporting & Analysis (FRA)
Accounting 53:010:565
Spring, 2023
Instructor: Professor Sungsoo Kim
Office: Room 434 BSB (227 Penn Street, Camden)
Office Hour : By appointment
Phone: (856) 225-6584
E-mail: sungsoo@rutgers.edu
Course Description & Objectives:
This course is designed to prepare you to interpret and analyze financial statements for tasks
involving credit and security analyses, lending and investment decision, and other decisions that
must rely on financial data. This course, therefore, explores in greater depth financial reporting
topics from the perspective of financial statement users. We develop sufficient understanding of the
concepts and recording procedures to enable you to interpret various disclosures in an informed
manner. We discuss each financial reporting issue in terms of its effect on assessments of a firm’s
profitability and risk. We then apply analytical tools and concepts in competitor analysis, credit and
investment decision, bankruptcy prediction, and valuation.
Required Materials:
“Financial Statement Analysis and Valuation”, by Easton, McAnally, Sommers & Zhang,
Cambridge Business Publishers (6th ed.) ISBN: 978-1-61853-360-9
Language: English
Publisher: Cambridge Business Publishers
ISBN-10: 1618533606
ISBN-13: 978-1618533609
*NOTE: The first two modules of this Textbook are available online for FREE
Please Click the following link to access Module 1 and Module 2 of this Textbook while you purchase
your own book: (please cut and past the following link to window address)
Financial Statement Analysis & Valuation, 6e by Easton, McAnally, Sommers (mybusinesscourse.com)
Regular Reading of The Wall Street Journal
My Business Course(MBC):
You will also need access to www.MyBusinessCourse.com ( MBC) where you can watch demos & eLectures
and where you will complete all of your assignments and exams. MBC is integrated with Canvas (please
download student.handout.sp.2023 from the top of Module Area of your Canvas.
Prerequisites:
Please note that you should have the following pre-requisite to enroll in this class:
(50:010:502) OR equivalent course
Preparation:
• Review and honor all Rutgers MBA policies listed in the classroom and syllabus.
• Invest approximately 12 hours throughout the week for the course. (For traditional onsite classes,
the industry standard is 3 hours per credit per week + the in-class meeting time.)
• Complete readings and research in advance of each week.
• Consistently demonstrate professionalism in your interactions with peers and faculty.
• Produce high quality, original work that properly cites the words and ideas of others.
• Uphold the integrity of your Rutgers MBA degree by not plagiarizing or cheating.
• Accept feedback and suggestions with an open mind, taking time to reflect, and then using what
you have learned to further improve your performance in future assignments.
• Notify your professor immediately if you confront a personal emergency that puts you at risk of
submitting a late assignment.
• Honor the principle that “everything written or said within the classroom stays within the
classroom.”
• Stay current on classroom news and postings by visiting the classroom regularly, at least once a
week. It is your responsibility to keep yourself current with all the announcements.
• Participate in the assigned class discussions, whenever you can, to get maximum credit for class
participation. These discussions are designed to be a collaborative learning experience for all
involved.
• For the general class discussion forum, you are also strongly encouraged to share any relevant class
related topics pertaining to current business environment. You may also benefit and assist other
students via thoughtful interaction.
• Direct Interaction: Although Canvas provides good learning tools, oftentimes, a direct one-to-one
professional interaction to resolve difficult issues is usually the most effective. For example, you
may have a certain technical/mathematical problem that is frustratingly difficult to solve that you
think is difficult be resolved in an open forum or elsewhere. In this case, please feel free to send me
an e-mail and a contact number so that I can call you directly to resolve it.
• Not checking your Rutgers email is not an excuse for missing any communications.
Homework Assignments through (MBC):
Complete any of the online homework assignment for each session. You will need access
to www.MyBusinessCourse.com ( MBC) where you can watch demos & eLectures and where you will
complete all of your assignments.
Class Materials:
All class materials can be obtained via Canvas. Note that the PowerPoint class materials for a particular week will be
posted by noon on Monday, usually one week ahead of schedule (except for the first week or two.) You are strongly
encouraged to access this course via Canvas several times a week. You can imagine that the class seamlessly “runs”
through from Day 1 (Monday) to Day 7 (Sunday).
Class Communication:
Since class attendance is not compulsory, a viable and reliable form of communication is vitally important.
Note that all class communication will be via your Rutgers e-mail and discussion forums and other tools in
Canvas. You are expected to check your Rutgers e-mail at least (equally spaced) two or three times every
week. All class announcements can also be accessed via the ‘Announcement’ page in Canvas.
Professor Communication:
Note that during the week, from Monday until Friday, I will try reply to all e-mails within 24 hours. Please
do not expect immediate response. (If you do not hear from me within 48hours, please re-send your email
as I may have overlooked or accidentally deleted your e-mail.) Although, I check my e-mails a few
times daily, I may not be able to completely answer all e-mails immediately upon receiving them. Note that
I may also be travelling out of town on many weekends and may not be able respond to weekend e-mails
until Monday. It is recommended that you do not give out personal email or twitter accounts. For phone
calls, best practice is to call the student vs. giving out your phone number. If you have a question in
quantitative nature that requires a long, complex explanations please email me.
Etiquette expectations from on-line students:
The following protocols on the codes of behavior reflect professional business norms on manners, courtesy,
and respect. (In general, you should treat others as you would like others to treat yourself. Be mindful
that what is acceptable in a text or chatroom with friends may not be appropriate in a classroom or in an
online conversation with an instructor.)
Even though many of you are already aware of these protocols, they are explicitly stated here so that
everyone is cognizant of the same protocols. These protocols should be followed by all students taking this
course to help ensure the online experiences for everyone involved are pleasant. They are as follows:
• When sending an e-mail, you can get better attention by using the following guidelines:
o use descriptive subject lines, (I am sure you have received a lot of Spam e-mails and I have
occasionally and accidentally deleted student e-mails that I thought was Spam.)
o please be as brief as possible by going straight to the point, and if possible, limit the use of
attachments
Never send offensive and insulting messages* (this is a violation of the Student Code of Conduct). If you
disagree, say so and state your reasons. Social media is a very powerful tool for communication. However,
it can be badly misused if it is not used correctly or professionally. For example, you may have personal
and legitimate concerns with this course. However, other students, who do not have similar feelings, can be
negatively influenced by your concerns. This will unnecessarily and negatively affect their overall
experience of the course. Therefore, to minimize such an occurrence, please feel free to directly contact the
instructor/tutor first to resolve any concerns that you may have to help ensure that everyone’s online
experience of this course is beneficial.
• Always guard against inciting others when it comes to content, opinions,
etc. That is, avoid blaming or accusing others of wrong doing.
• Do not start a volley of back and forth e-mails, with copies distributed to every student in the class.
• Copy the minimum number of people. That is, send e-mails to only the people you think should
receive and will benefit from it.
• Treat all e-mails and postings as permanent forms of written record and do not expect that any your
e-mail communications to be private, unless stated otherwise. Instead, assume that all e-mail
communications are public.
• Do not publicize your own or others’ personal information (such as email, phone numbers, last
names, etc.)
Important Administrative Dates (subject to change):
• Tuesday. January 17, 2023 – First day of Spring 2023 semester
• Thursday January 26, 2023– Last day to drop a class without a “W” (this can be done through
WebReg)
• Monday, April 3,– Last day to withdraw from one or all classes with a “W”. (This can be done
through WebReg) For more information, see the registrar’s website
http://registrar.camden.rutgers.edu/
• Saturday, March 11, 2023 – Sunday, March 19, 2023 – Spring Break
• Wednesday, May 1, 2023 – Last day of classes
• Friday May 4, 2023 – Wednesday May 10, 2023 - Final Exam Period
Discussion Board Activity:
There will be specific discussion board activities for each module in this course.
Discussions may involve any combination of prepared materials, journal articles, textbook readings,
problems, videos, or other resources. During the week of discussion activity, students are expected to
create at least one Discussion Thread by Day 5 (Friday) of each week that a discussion topic is assigned
and then by Day 7 (Sunday) have responded to at least one other posted thread by other students in the
class. All postings including responses are to be substantive and further the discussion of the topic of
interest.
Postings on the discussion board must reflect student’s reading and comprehension of the assigned readings
and/or related discussion activity. Discussion postings must reflect the ability to synthesize concepts
presented through writing at a college level. The minimum length of a post is 100 words not including
references listed. In addition to these specific assigned discussions, there will also be a general class
Discussion for discussing issues related to the class, but these will not be graded.
Grading:
The assignment of final grades, the course requirements will be weighted approximately as follows:
Syllabus test ............................. 2%
Homework…………………...10%
First exam……..……………..22%
Second exam .......................... 22%
Team Project .......................... 30%
Discussion .............................. 14%
Grade Ranges:
A : Highest grade (90% and above)
B+: Work of distinction (85% to 89.9%)
B: Work of distinction (80% to 84.9%)
C+: Average work (75% to 79.9%)
C: Average work (70 % to 74.9%)
F: Failure without credit (Below 69.9%)
You are free to discuss any part of the course materials with your classmates. However, you are not
allowed to discuss (i.e., receive nor give any assistance on) any part of the Mini-Exams or Case with
anyone, except with the professor. If any cheating is found, I will seek the most severe sanctions
available (i.e., at the minimum, you will receive an “F” grade for the course).
Exam Policy:
The format and policy for each Exam are as follows:
1). All Exams will be posted by noon on the Wednesday of the week of the exam and has to be completed
by midnight Sunday of the same week.
a) Syllabus Test will be posted by noon on Tuesday, Jan 17, 2023 and must be completed by
midnight Sunday, January 22, 2023
b) Exam 1 will be posted by noon on Wednesday, Feb. 20, 2023 and must be completed by
midnight Sunday, Feb 25, 2023.
c) Exam 2 will be posted by noon on Wednesday, April 5, 2023 and must be completed by April
9, 2023 (Sunday) midnight.
Any student who did not take the Exam during this time window will receive a zero grade for that exam.
2). You can take the exam only once. Once started, the Exam must be completed. That is, do not log out
until you have finished the exam. Any unanswered question will automatically receive a zero grade for that
question. Make sure you click the ‘Submit’ button after you have completed Exams.
3). You are allowed up to three hours to complete the exam. Hence, you must start the taking the exam
by 9 p.m. on Sunday so that you can use up to 3 hours and complete it by the midnight deadline.
4). Any student who missed the exam, without prior approval of the instructor or a compelling reason, will
receive a zero grade for that exam.
Exam Make-Up Policy: Since you are given reasonable amount of time to work on the exams, make-ups
are very rarely given. If you cannot take an exam by the scheduled deadline for a university-approved
reason, you must give the professor a written notice at least one week in advance so that other arrangements
can be made. If the situation does not allow for advance notification (for example, emergency
hospitalization), please contact the professor as soon as possible after a missed exam. The faculty reserves
the right to request a written documentation to support your absence (such as a doctor’s note or military
orders).
Online Schedule of class activities for FSA, Spring, 2023
Week
beginnin
g
Reading
Homework Assignment
due
remarks
Jan 17
Module 1
Jan 23
Jan 30
Module 2
Module 1: P1-43
Feb, 6
Module 3
Module 2: P2-49, P2-51
Feb. 13
Module 4
Module 3: P3-46
Feb. 20
Modules
1, 2 and 3
Feb. 27
Module 5
Module 4:
E4-29
P4-35(Walmart, Costco,
Target only)
Mar 6
Module 6
Module 5: E5-44, P5-53
March
13
March
20
Module 7
Module 6: E6-40, P6-43
March
20
Module 8
Module 7: E7-40, P7-45
March
27
Modules
4,5,6 & 7
April 3
Module 9
Module 8: P8-52, P8-55
Apr. 10
Module 10
Module 9: P9-48, P9-49
April 17
Module 11
Module 10: P10-43
April 24
Module 12
May 1
Due date:
May 6
Team Project
Financial Reporting and Analysis: Acct. 565
School of Business, Rutgers University-Camden
Spring, 2023
Purpose of the Project:
The purpose of the term project is to apply financial analysis and valuation concepts, tools, and techniques
to an issue or situation of particular interest to you. In addition to preparing a written report in Word file,
each student should be prepared to present her/his project in Power Point file and submit them for review.
PPT file should be prepared the same way you would present your paper in face-to-face class. Since we are
in online learning environment you might want to use voice threads and others visual techniques to
maximize the efficiency of your presentation.
The term project will give you the opportunity to study, in depth, the implications of a specific accounting
issue/controversy, a financial transaction (such as a management buyout, a merger, or acquisition), a
particular circumstance (such as financial distress), a single firm or an industry. It will also give you the
opportunity to develop your research, report writing, and presentation skills. Your project should evidence
detailed analysis of financial statement data, including footnotes.
Your report will be improved if you apply the concepts, tools, and techniques of analysis developed in the
course (such as a discussion of accounting issues and choices, and financial analysis, forecasting, and
valuation techniques). The project should also include some form of "benchmarking;" that is, a comparison
to similar circumstances or firms.
The written part of your project should be no more than 15 pages (double-spaced, word-processing font no
smaller than 12-point, one-inch margins all around), including tables, graphs, appendices, and references.
Also include any supporting financial statements and articles (these do not count as part of the 15-page
maximum length). For PPT file I suggest you prepare around 10 slides by summarizing your project.
This is to learn how to measure the performance of companies by analyzing their financial
statements. Show us that you have read and understood the required readings, links and attached files -
quote them where appropriate.
Assignment:
You are the CFO of a major company. Your CEO keeps an eye on the competition, and asks you to do the
following analyses:
Instructions:
Each team of 3 or 4 students will be randomly assigned a pair of US public firms in the same industry.
These two firms are comparable in terms of size and other operating characteristics. You are allowed to
switch one of the two firms if you prefer to use another firm but doing so requires instructor’s permission in
advance. Canvas System also randomly selects Group leader, who is responsible for the submission of final
files to the Assignment folder.
A) Select at least 10 most important financial ratios for your two companies and calculate each for the
last 2 fiscal years using Excel. Explain why you selected these ratios. (a sample project in Excel
file will be posted to the classroom early in the semester for your reference.) Create a comparison
chart for these ratios for 2 years for each company. Explain how you calculated each
ratio. Explain what each ratio should mean to management. Using ratio analysis, compare two
major competitors in the same industry.
All calculations should be shown, and all answers should be thoroughly explained.
It is useful to compare financial ratios for a company with financial ratios of its industry. Industry
financial ratios can be found on Morningstar.com, Yahoo Finance and MSN Money.
There is an example posted in the file attached for your reference. The "Compare"
worksheet shows comparison of ratios, however it does not include the required words
about how the ratios were calculated nor does it include what the numbers mean for
management.
You will note that the W and C worksheets are used to calculate average balance sheet
numbers. These are useful when there is large year to year changes on the balance sheet.
If you obtain data from the SEC web site "Interactive Data, then you can copy and paste
into Excel. If you use data from other web sites, it may or may not allow excel to
calculate ratios. The company website usually lists Excel file of its annual report.
Create a single Excel file for your calculations and cut and paste relevant pages to your Word
and/or PPT file. You need to submit this Excel File, together with the final report. Spend time to
understand what you are trying to do and simplify your format, your calculations and
approach. Think about which ratios are important and WHY?
You may obtain financial information and the companies' latest annual reports on the web directly
from MSN Money or Yahoo Finance or Morningstar. However, it may be necessary to enter the
numbers by hand into excel to allow Excel to calculate ratios. For additional information, look for
the SEC Form10-K link from one of the MSN Money, or Morningstar, or Yahoo Finance financial
sites.
What can you tell from your analysis? What are the strengths and weaknesses of each
company? Which is the stronger competitor? Give your reasons.
B) Describe any industry specific accounting problems and practices. Tabulate and compare
the accounting methods chosen by your firms in their most recent financial statements.
How do these choices affect the ability to make comparisons among firms? Compare the
most important financial ratios for your set of firms. How is this comparison affected by
your firms' accounting choices? What do these ratios suggest about firm strategies within
the industry? If you were making stock recommendations, would you recommend
buy/hold/sell on any of these firms? Why, or why not?
You should support your analytical inferences with figures/computations, making valid or
reasonable assumptions as necessary. Your analysis should explore (in depth) the risks,
accounting and/or market returns, strengths, opportunities, uncertainties, threats, etc., that face the
company.
C). 3 files to be submitted by the last day of the class.
a. 15-page Word file: the final report, including tables, graphs and references.
b. 10-slides PPT file: summary of the project
c. A single Excel file for ratio computations and industry comparison.
D). Group member and a pair of firms assigned.
Assigned firms to each group.
Group 1: Home Depot vs. Lowe’s
Group 2: Coke vs. Pepsi
Group 3: Nike vs. Under Armor
Group 4: Costco vs. Walmart
Group 5: Google vs. Microsoft
Group 6: John Deere vs. Caterpillar
Group 7: GM vs. Ford
Group 8: Macys vs. Nordstrom (or any other major retail department store)
Group 9: Hilton vs. Marriott
Group 10: Amazon vs. EBay
Group 11: Starbucks vs. Dunkin
Group 12: Boeing vs. Lockheed Martin
Or any other pair of firms in the same industry, subject to instructor’s approval