Accounting Analysis I: The Role of Accounting as an Information System

About this course: This course is the first course in a five-course Financial Reporting Specialization that covers the collection, processing, and communication of accounting information (via financial reports) about economic entities to interested parties (i.e., managers and external stakeholders such as stockholders and creditors). To gain the most relevant knowledge from these courses, learners should have taken a basic accounting course prior to this Specialization (which can be done through Coursera courses, such as any accounting course from the Fundamentals of Accounting Specialization: https://www.coursera.org/specializations/accounting-fundamentals). This Specialization focuses on accounting concepts, principles and theory with an emphasis on problems that arise in applying these concepts for external reporting purposes. Specific emphasis is placed on measurement of assets, liabilities, equities and income, as well as disclosure of additional information that may assist users understand the financial reports. After a brief introduction to the course, we will spend time understanding the overall financial accounting structure and standards as well as review the fundamental accounting process used to prepare the financial statements, which will establish a framework for the study of the concepts in the remaining courses in the Financial Reporting Specialization. In this course, we will begin our review of key information included in the Balance Sheet and Income Statement and their related financial disclosures. The Statement of Cash Flows will be introduced briefly with more discussion to follow in later courses of the Specialization. Also, we will provide a cursory review of key concepts involving time value of money as we will finish this course with focus on revenue recognition, including discussion of the new revenue standard. We will review the general approach for recognizing revenue, special issues affecting revenue recognition including long-term construction contracts. In addition, we will discuss and review common ratios used in profitability analysis. The University of Illinois at Urbana-Champaign, consistently ranked as one of the nation's top three accounting programs, now offers a master’s in accounting at a very affordable tuition rate and is completely online. The iMSA is a full Master of Accountancy program and students graduate with an MS that is highly recognized. Try an open course or two, then apply for admission into the credit-bearing version as you may be eligible to take credit-bearing courses during the application process. If you are missing any prerequisites for the full degree, you can complete Coursera courses to demonstrate readiness and strengthen your application for the iMSA. For more information on this exciting iMSA online program, refer to this link: https://www.coursera.org/university-programs/imsa

Who is this class for: This course is designed to prepare learners who want to enhance their basic knowledge of accounting and be better prepared for higher level accounting positions, take the CPA Exam or just to better understand accounting, the "language of business", for those working outside of this field! Because this sequence is intended to assist you in professional preparation, you will be expected to develop analytical, problem-solving and technical skills used by accounting professionals. Upon completion of the Financial Reporting Specialization, you should have a good understanding of the theoretical and technical aspects of financial reporting methods for assets, liabilities, and stockholders’ equity.

Created by:  University of Illinois at Urbana-Champaign

• Taught by:  Gregory L. Davis, CPA, CMA, CFM, CCM, Lecturer of Accountancy

  Department of Accountancy, College of Business

Basic Info Course 1 of 5 in the Financial Reporting Specialization Level Intermediate Commitment 8 weeks of study, 6-8 hours/week Language English How To Pass Pass all graded assignments to complete the course. Complete this course to work toward: Financial Reporting Specialization This course is part of the 5-course Financial Reporting Specialization from University of Illinois at Urbana-Champaign Learn More Master of Science in Accounting (iMSA) This course is part of the fully-online 16 eight-week courses degree program Learn More Coursework

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University of Illinois at Urbana-Champaign The University of Illinois at Urbana-Champaign is a world leader in research, teaching and public engagement, distinguished by the breadth of its programs, broad academic excellence, and internationally renowned faculty and alumni. Illinois serves the world by creating knowledge, preparing students for lives of impact, and finding solutions to critical societal needs.

Syllabus


WEEK 1


Course Orientation
You will become familiar with the course, your classmates, and our learning environment. The orientation will also help you obtain the technical skills required for the course.


4 readings, 1 practice quiz expand

1. Reading: Syllabus
2. Reading: About the Discussion Forums
3. Practice Quiz: Orientation Quiz
4. Reading: Updating Your Profile
5. Discussion Prompt: Getting to Know Your Classmates
6. Reading: Social Media

Module 1: Financial Accounting Structure/Environment
We will learn the primary focus of financial accounting and learn about General Accepted Accounting Principles (GAAP) and their key assumptions, as well as compare them to International Financial Reporting Standards (IFRS).


7 videos, 1 reading, 4 practice quizzes expand

1. Video: Module 1 Introduction
2. Reading: Module 1 Readings and Resources
3. Video: What Is the Key Focus of Financial Accounting?
4. Practice Quiz: Lesson 1-1 Knowledge Check
5. Video: Cash vs Accrual Accounting
6. Practice Quiz: Lesson 1-2 Knowledge Check
7. Video: GAAP vs IFRS and Convergence
8. Practice Quiz: Lesson 1-3 Knowledge Check
9. Video: Accounting Standards and GAAP Assumptions
10. Video: FASB Interview with Brian McKeown
11. Video: Module 1 Wrap-Up
12. Practice Quiz: Lesson 1-4 Knowledge Check

Graded: Module 1 Quiz

WEEK 2


Module 2: Review of Accounting Process
We will use the accounting equation to complete the processing cycle. We will also learn the basic types of month-end adjusting entries. importantly, we will describe the four basic financial statements and how they relate to one another.


5 videos, 1 reading, 3 practice quizzes expand

1. Video: Module 2 Introduction
2. Reading: Module 2 Readings and Resources
3. Video: Using the Accounting Equation During the Processing Cycle
4. Practice Quiz: Lesson 2-1 Knowledge Check
5. Video: Adjusting Entries
6. Practice Quiz: Lesson 2-2 Knowledge Check
7. Video: Financial Statements
8. Video: Module 2 Wrap-Up
9. Practice Quiz: Lesson 2-3 Knowledge Check

Graded: Module 2 Quiz

WEEK 3


Module 3: Balance Sheet & Financial Disclosures



We will learn the nuances of the Balance Sheet as well as various forms of disclosures associated with financial statements, including the Auditors' Report and MD&A. We will also review several key liquidity and financing ratios. Lastly, we will learn what's included in the operating segment reporting and wrap up with a fun exercise on understanding your own personal Balance Sheet!


7 videos, 1 reading, 4 practice quizzes expand

1. Video: Module 3 Introduction
2. Reading: Module 3 Readings and Resources
3. Video: Usefulness, Limitations, and Classifications of the Balance Sheet
4. Practice Quiz: Lesson 3-1 Knowledge Check
5. Video: Financial Disclosures
6. Practice Quiz: Lesson 3-2 Knowledge Check
7. Video: Risk and Ratio Analysis
8. Practice Quiz: Lesson 3-3 Knowledge Check
9. Video: Operating Segments and Other Disclosures
10. Video: Module 3 Wrap-Up
11. Video: Simplified “Personal” Balance Sheet Example
12. Practice Quiz: Lesson 3-4 Knowledge Check

Graded: Module 3 Quiz

WEEK 4


Module 4: Income Statement and Accounting Changes



We will learn the key components of the Income Statement (e.g., EPS) and its impact on shareholders’ equity. We will also distinguish income from continuing operations vs discontinued operations. Lastly, we will better understand the impact of various accounting changes.


5 videos, 1 reading, 3 practice quizzes expand

1. Video: Module 4 Introduction
2. Reading: Module 4 Readings and Resources
3. Video: Lesson 4-1: Income Statement and Its Key Components
4. Practice Quiz: Lesson 4-1 Knowledge Check
5. Video: Discontinued Operations and Earnings Per Share
6. Practice Quiz: Lesson 4-2 Knowledge Check
7. Video: Accounting Changes
8. Video: Module 4 Wrap-Up
9. Practice Quiz: Lesson 4-3 Knowledge Check

Graded: Module 4 Quiz

WEEK 5


Module 5: Time Value of Money, Ethics, & Other Financial Statements



We will learn some of the key concepts related to time value of money. We will also discuss ethics and professionalism, as well as lessons learned from past accounting scandals. Finally, we will briefly review the Statement of Cash Flows (SCF) and Statement of Comprehensive Income (SOCI).


6 videos, 1 reading, 3 practice quizzes expand

1. Video: Module 5 Introduction
2. Reading: Module 5 Readings and Resources
3. Video: Time Value of Money
4. Practice Quiz: Lesson 5-1 Knowledge Check
5. Video: Ethics, Professionalism, and Fraud
6. Practice Quiz: Lesson 5-2 Knowledge Check
7. Video: Statement of Comprehensive Income and Statement of Cash Flows
8. Video: HE&R CEO Interview with Bill Simpson
9. Video: Module 5 Wrap-Up
10. Practice Quiz: Lesson 5-3 Knowledge Check

Graded: Module 5 Quiz
Graded: Key Topics Peer-Graded Assignment

WEEK 6


Module 6: Revenue Recognition



We will learn the key issues involving revenue recognition, including the five key steps. Next, we will determine when to recognize revenue, including involvement of multiple performance obligations and special issues related to steps 4 and 5. Lastly, we will discuss the presentation and disclosure requirements of revenue.


5 videos, 1 reading, 3 practice quizzes expand

1. Video: Module 6 Introduction
2. Reading: Module 6 Readings and Resources
3. Video: Revenue Recognition Issues Including the Five Key Steps
4. Practice Quiz: Lesson 6-1 Knowledge Check
5. Video: Dealing with Multiple Performance Obligations (POs)
6. Practice Quiz: Lesson 6-2 Knowledge Check
7. Video: Special Revenue Recognition Issues
8. Video: Module 6 Wrap-Up
9. Practice Quiz: Lesson 6-3 Knowledge Check

Graded: Module 6 Quiz

WEEK 7


Module 7: Revenue & Ratio Analysis



We will understand the two methods of revenue recognition for long-term contracts. Next, we will introduce the concept of financial ratios and the various types of activity and profitability ratios. Lastly, we will discuss how the DuPont Framework analysis incorporates profitability, activity, and leverage ratios into the overall Return On Equity (ROE).


6 videos, 1 reading, 4 practice quizzes expand

1. Video: Module 7 Introduction
2. Reading: Module 7 Readings and Resources
3. Video: Accounting for Long-Term Contracts
4. Practice Quiz: Lesson 7-1 Knowledge Check
5. Video: Accounting for Losses on Long-Term Contracts
6. Practice Quiz: Lesson 7-2 Knowledge Check
7. Video: Installment Sales Method
8. Practice Quiz: Lesson 7-3 Knowledge Check
9. Video: Profitability Analysis Using Financial Ratios
10. Video: Module 7 Wrap-Up
11. Practice Quiz: Lesson 7-4 Knowledge Check

Graded: Module 7 Quiz
Graded: Service Revenue and Evaluating Efficiency Problem Set

WEEK 8


Module 8: Course Wrap-Up & Case Study



You will work on a case study that will serve as a refresher of all of the concepts that you have learned over the past seven modules of this course. The case study will involve analysis of a publicly held Fortune 500 company in which you will analyze the Annual Report or 10K Report.


1 video expand

1. Video: Course Wrap-Up and Case Study Introduction
2. Discussion Prompt: Final Reflections

Graded: Comprehensive Company Analysis Case Study