Hi! Welcome to the Financial Accounting Class.

I look forward to meeting

you and making this course fun, lively, and inspiring for all of us! This
document provides answers to some basic questions about the course. I
will answer any additional questions that you may have in the first class.
See you!

1. Why would you want or need to take this course?

Mastery of accounting provides you with concepts, skills, and tools that
you need in a wide variety of decision-making settings. Examples are:
As a potential investor, accounting knowledge will help protect
and increase your financial wealth by enabling you to make
informed investment decisions;
As an employee, it will aid you in evaluating prospective
employers and thus help you to make informed career decisions;
As an entrepreneur or as a business unit manager, you need to
understand and use accounting data of your firm, industry, and
competitors to make optimal operating, investing, and financial
decisions.
In general, improving your accounting knowledge / skills will make you a
more sophisticated consumer of not just financial statements, but also of
business news. Additionally, it will help you answer or think critically
about questions such as:
What is the value of IOCs supply of oil?
Does Infosys follow a conservative reporting policy?
How did Enron cook its books?
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 What are the implications of the new International Financial

Reporting Standards for corporate profitability in India?
2. What are the course objectives?
Your objectives for this course are to
obtain a first introduction to the process by which financial
statements are created
gain a reasonable working knowledge of the terms, concepts, and
assumptions underlying published financial statements
begin to learn to read, analyze, and evaluate published financial
statements
3. What are the prerequisites for the course?
Basic Numerical Literacy
4. What are the different parts of the course?
The course is divided into three parts. In the first part we learn how
financial statements are prepared how does the accountant do it?
In the second part, we take a more detailed look at financial statements
- what information does each of their components convey? In the
third part, we look at the relationships between the elements of the
financial statements and learn to draw conclusions about company
performance financial analysis.
5. How will a typical class proceed?
We will usually devote the first half of the class to concepts and
terminology and the second half to solving problems and cases.
There are no student-led presentations in this course.
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I will strive to make the classroom experience an interactive one where

questions and answers flow both ways.
6. What is the textbook for the course?
The textbook for the course is, Financial Accounting: A Managerial
Perspective, by Professor R. Narayanaswamy. The publisher is Prentice
Hall India. It is sold in the IIMB bookstore. Please buy one soon as we
will use it from day one and extensively throughout the course. And
bring the book to class!
7. What other resources should the students obtain?
A calculator is needed, unless you enjoy adding and subtracting
numbers in your brain! No laptops are allowed in class.
Course communications will be through Moodle. I will periodically post
additional optional reading on Moodle.
8. What do I expect from you?
Each class has an assigned chapter - please read the chapter ahead of
class. I will provide a list of problems and cases from the text that are
most important for each chapter. We will cover a subset of these in
class. I expect you to attempt the assigned problems and cases before
class. This will make the classroom experience more interesting and
fun for all of us.
After the class, attempt additional problems from the text that are
similar to those that we covered in class.
9. What do I mean by academic integrity?
The course grade is based on in-class exams (1 quiz, 1 mid-term, and 1
end-term) and one group project (more on these later). I expect the
highest standards of academic integrity to be adhered to when taking
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exams and turning-in the project. That means be honest and

complete on time.
In my own life, I am striving to be punctual in everything that I do.
Please inspire me by being in class on time and submitting the group
project on the due date.
10.

What is the purpose of exams and assignments?

The exams and group project will be designed to test your problemsolving and critical thinking skills. Because exams are closed-book
closed-notes, you will have to memorize some things.

11.

How will the final grade be determined? What are the

weights on the exams and group project?

The weights for the individual components of the course are:
Component

Weight

Quiz 1

15%

Midterm

25%

End-term

35%

Group Project

25%

The quiz, the mid-term, and end-term are closed-book, closed notes. You
may bring a calculator to the exam hall.
I have not allotted points for class participation, but I encourage you to
ask questions and actively contribute to classroom discussion.
Dates for the quizzes and exams will be announced shortly.
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12.

Detailed Schedule

Please see the last page on this document. I will provide a list of
problems and cases that we will discuss shortly.
13.

Grading and Exams

Except in the rare case of significant errors in the grading of your

examinations and projects, I will be very unwilling to change the points
assigned.
Exams will not be returned to students. They will be available for
inspection at a scheduled time after I complete grading them. After the
initial inspection, those who wish to have their exam re-graded can fix
an appointment with me. Before your appointment, you will have to
provide a type-written one-page sheet containing a description of why
you would like me to change your score. If I believe that you have a
valid case, I will re-grade your entire exam. The consequence of such a
re-grade could be either an increase or a decrease in your total score.

14.

Attendance Policy

If you miss between 4 and 6 classes you will lose 5% of your grade. If
you miss between 7 and 9 classes you will lose 10% of your grade. And
so on.
To explain this, suppose your overall score in the course is 83 out of
100. If you miss 4 classes, your final score will be reduced to 79 (83
(83 * 0.05)).
15.

Group Financial Statement Analysis Project

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Context

For your final project, your group will assume the role of a financial
analyst and conduct research for a client (e.g., an individual investor or
a portfolio manager). The objective of your report is to critically analyze
the financial statements of a company and evaluate the performance
and financial position of the firm. More details will be provided in a
separate document.

Group Size

Group size should equal five. Once you have given me your group
composition, you cannot change it.

Deliverable

A hard copy of the written report is to be given to me on a date to be

announced in class. No extensions will be granted.

Schedule of Classes with topics and Chapter #s

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Week #

Topic

Chapter

Week 1

Accounting and Economic Decisions

Week 2

Processing Transactions

Week 3

Measuring Income

Week 4

Merchandising Transactions; Financial

Statement Analysis

4 and 11

Week 5

Financial Statement Analysis;

Receivables

11 and 5

Week 6

Receivables; Inventories

5 and 6

Week 7

Inventories; Fixed Assets

6 and 7

Week 8

Fixed Assets and Investments

7 and 8

Week 9

Liabilities

Week 10

Cash Flow Statement

12

Quiz

Date to be announced

Midterm

Date to be announced

Final
Exam

Date to be announced

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