- What is financial statement analysis?
- Key components of balance sheets and income statements
- The DuPont framework
- Profitability ratios
- The operating cycle
- Computing debt ratios
- Limitations of financial statement analysis
Skill Level Intermediate
- Hi, I'm Jim Stice, I'm a Professor of Accounting at Brigham Young University. This is my brother Kay. - I'm also a Professor of Accounting at Brigham Young University. We are an accounting family. - Absolutely, we love numbers. We love financial statements, and we love using financial reports to gain insight into how companies work. - [Kay] This course introduces you to methods of financial statement analysis that allow you to use a company's financial reports to identify the company's strengths and weaknesses. - [Jim] You can use a company's financial reports to identify how they've preformed in the past, areas for improvement in the future as well as to identify areas of risk in the now. - Before taking this course, you might consider taking our Accounting Foundations course. That course introduces you to the major areas of accounting. - But with that said, we have designed this Corporate Financial Statement Analysis course to be self-contained, and we carefully explain any accounting terminology that we use. - In short, this is an introductory course with no prior accounting knowledge necessary. Now when it comes to financial statement analysis, I like to borrow a quote from Winston Churchill. He said the following. "The further backward you can look, "the further forward you can see." - We analyze financial statements to tell us if a company has done well or poorly in the past and help us see how the company might do in the future. - With financial statement analysis, you can begin to spot trends in the financial statement data that provide clues as to what the future might hold. - You can start to see how past decisions have affected the financial statements and how decisions made now might affect the statements of the future. - [Kay] Financial statement analysis is the process of using the relationships among a company's financial statement numbers to gain insights into that company's operations. Past, present, and future. - So, let's go.