Financial Statement Analysis

Module description

The aim of the module is to enhance your knowledge of the theory and practice of financial reporting and analysis.  To this end, the module will provide a framework for business analysis and valuation based on financial reporting. The module will cover strategic analysis, financial statement analysis forecasting, valuation theory, equity analysis, credit analysis, and mergers and acquisitions.

Full module specification

Module title:Financial Statement Analysis
Module code:BEA3019K
Module level:3
Academic year:2016/7
Module lecturers:
  • Dr Mari Paananen - Convenor
Module credit:15
ECTS value:



BEA2001K Financial Accounting



Duration of module: Duration (weeks) - term 1:


Module aims

This module follows on from the second year financial accounting module, study of which is a prerequisite for entry to this module.  This module has three aims:

  • to develop students’ knowledge  and skills by providing a framework on how to use financial reporting for business analysis;
  • to provide students with an understanding of the consequences of companies’ strategic choices in terms sustainable performance; and
  • to advance students’ knowledge and skills in how to assess provide a tool set for equity analysis and credit analysis and distress prediction.

ILO: Module-specific skills

  • 1. conduct strategic analyses assessing firms’ choice of industry and choices related to corporate strategies to cope with competition in that industry sector;
  • 2. adjust reported accounting numbers to facilitate comparisons and undo distortions
  • 3. conduct a ratio analysis based on adjusted accounting numbers;
  • 4. use ratio analysis for prospective forecasting;

ILO: Discipline-specific skills

  • 5. analyse and draw reasoned conclusions concerning structured problems from a given set of data;
  • 6. apply logical thinking and numeracy skills to problems and cases by using appropriate accounting knowledge and valuation theories;
  • 7. critically evaluate arguments and evidence;

ILO: Personal and key skills

  • 8. demonstrate written communication skills
  • 9. use information technology for information retrieval, numerical analysis and report production;

Learning activities and teaching methods (given in hours of study time)

Scheduled Learning and Teaching ActivitiesGuided independent studyPlacement / study abroad

Details of learning activities and teaching methods

CategoryHours of study timeDescription
Scheduled Learning & Teaching activities22Lectures
Scheduled Learning & Teaching activities11Workshops/Tutorials
Guilded Independent Study117Reading and preparation for workshops/tutorials and assessments

Formative assessment

Form of assessmentSize of the assessment (eg length / duration)ILOs assessedFeedback method
Weekly tutorial problems for discussionVarying1-9Verbal and suggested solutions provided on ELE

Summative assessment (% of credit)

CourseworkWritten examsPractical exams

Details of summative assessment

Form of assessment% of creditSize of the assessment (eg length / duration)ILOs assessedFeedback method
Coursework30Maximum 2,000 words excluding any tables, charts or diagrams, and the list of references/bibliography1-9In writing
Examination702 hours1-8Suggested solutions on ELE

Details of re-assessment (where required by referral or deferral)

Original form of assessmentForm of re-assessmentILOs re-assessedTimescale for re-assessment
Coursework and Examination2-hr written examination1-8August assessment period

Re-assessment notes

Students who fail the module overall will be reassessed by way of a two-hour written examination in the summer of the respective academic year.

Syllabus plan

  • Introduction to financial reporting and analysis and providing a framework for business analysis using financial statements;
  • Strategic analysis;
  • Accounting for pensions;
  • Accounting analysis;
  • Financial analysis;
  • Forecasting;
  • Equity security analysis;
  • Credit and distress prediction; and
  • Mergers and acquisitions.

Indicative learning resources - Basic reading

Prescribed reading:
Customised textbook containing the following chapters:
Palepu, K.G., Healy, P.M., and Peek, E. Business Analysis and Valuation – IFRS edition, latest edition, London: Cengage Learning , chapters 1-6 and 9-11.
Alexander, D., Britton, A. and Jorissen, A. International Financial Reporting and Analysis. latest edition London: Cengage Learning, chapter 22.

Basic reading:

Alexander, D., Britton, A. and Jorissen, A. (2011) International Financial Reporting and Analysis. 5th ed. London: Cengage Learning.
Picker, R., Leo, K., Loftus, J., Wise, V., Clark, K. and Alfredson, K. (2013) Applying International Financial Reporting Standards, 3rd ed. Milton, Australia: John Wiley & Sons Australia, Ltd.

Module has an active ELE page?


Indicative learning resources - Web based and electronic resources

Indicative learning resources - Other resources

Relevant articles and reading on ELE

Origin date


Last revision date