Financial Statement Analysis & Controls

This unit develops students’ ability to read, analyze, and protect financial information by linking financial statements, internal controls, and accounting systems to business decision-making. Building on foundational accounting principles, students will evaluate liquidity, profitability, valuation, forecasting, and pricing while preparing for more advanced managerial and auditing applications in subsequent units.

Learning Objectives

• Analyze balance sheets, income statements (including conservative presentations), and statements of cash flows to assess liquidity, solvency, profitability, and differences between profit and cash flow
• Apply common forecasting and business valuation techniques and pricing methods to support short-term and strategic decision-making, citing assumptions and limitations
• Demonstrate procedures for implementing and testing internal controls and electronic money-flow protections within accounting systems to safeguard assets and ensure reliable reporting
• Evaluate financial reports of private and public entities, identify common accounting ‘tricks of the trade,’ and recommend improvements for clearer internal and external reporting