章节4财务报表分析讲义

1、CFA一级培训项目Financial Reporting andAnalysisTopic Weightings in CFA Level I2-387Session NO.ContentWeightingsStudy Session 1Ethics & Professional Standards15Study Session 2-3Quantitative Analysis12Study Session 4-6Economics10Study Session 7-10Financial Reporting and Analysis20Study Session 11Corporat

2、e Finance7Study Session 12Portfolio Management7Study Session 13-14Equity Investment10Study Session 15-16Fixed Income10Study Session 17Derivatives5Study Session 18Alternative Investments4F.R.AØ SS7l R22: Financial Statement Analysis: An Introductionl R23: Financial Reporting Mechanicsl R24: Fina

3、ncial Reporting StandardsØ SS9Ø R29: InventoriesØ R30: Long-Lived AssetsØ R31: Income TaxesØ R32: Long-Term Liabilities and LeasesØ SS8l R25: Understanding the I/Sl R26:Understanding the B/Sl R27: Understanding the C/Fl R28: Financial Analysis TechniquesØ SS10Ø

4、; R33: Financial Reporting QualityØ R34: Financial Statement Analysis: Applications3-387The Framework of FRSGenerally AcceptedAccounting PrincipleworldwideThe Financial Accounting Standards Board (FASB)Øl The Statement of Financial Accounting Standards (SFAS) à U.S. GAAPThe Internatio

5、nal Accounting Standards Board (IASB)l The International Accounting Standards (IAS)ØàIFRSl The International Financial Reporting Standards (IFRS)Recognition à Measurement à DisclosureFinancial analysis4-387Framework1.The role of financial reporting and financial statement analysi

6、s2.The resources used for financial statement analysisl Key financial statementsl Other relevant information3.Auditing4.Financial statement analysis framework5-387Financial reporting & analysisØThe role of financial reportingl The International Accounting Standards Board (IASB) definition:&

7、#252; Financial reporting refers to the way companies show their financial performance to investors, creditors, and other interested parties by preparing and presenting financial statements.ü The objective of financial statements is to provide information about then Financial positionn Financia

8、l performancen Changes in financial position of an entity that is useful to a widerange of users in making economic decisions.The role of financial reporting analysis is to use the information in a companys financial statements, along with other relevant information, to make economic decisions.Ø

9、;6-387Financial statementsThe statement of changes in owners equity7-387Financial positionFinancial performanceChange in financial positionThe balance sheetThe income statementThe cash flow statementAssets = liabilities + owner'sRevenueequityExpensesNet income Operating cash flows Investing cash

10、 flows Financing cash flowsNet cash inflow or outflow for the financial yearBalance sheetØKey financial statements:l Balance sheetü The balance sheet (also known as the statement of financial position or statement of financial condition) reports the firm's financial position at a point

11、 in time.ü The balance sheet consists of three elements:n Assets are the resources controlled by the firm.n Liabilities are amounts owed to lenders and other creditors.n Owners' equity is the residual interest in the net assets of an entity that remains after deducting its liabilities.ü

12、; Transactions are measured so that the fundamental accounting equation holds:n assets = liabilities + owners' equity8-387Income statementØIncome statementl The income statement (also known as the statement of operations or the profit and loss statement) reports on the financial performance

13、 of the firm over a period of time.l The elements of the income statement include:ü Revenues are inflows from delivering or producing goods, rendering services, or other activities that constitute the entity's ongoing major or central operations.ü Expenses are outflows from delivering

14、or producing goods or servicesthat constitute the entity's ongoing major or central operations.ü Other income includes gains that may or may not arise in the ordinary course of business.9-387Cash flow statementØCash flow statementl The statement of cash flows reports the company's

15、cash receipts andpayments.l These cash flows are classified as follows:ü Operating cash flows include the cash effects of transactions that involve the normal business of the firm.ü Investing cash flows are those resulting from the acquisition or sale of property, plant, and equipment; of

16、a subsidiary or segment; of securities; and of investments in other firms.ü Financing cash flows are those resulting from issuance or retirement of the firm's debt and equity securities and include dividends paid to stockholders.10-387Financial statementsØMeasurement of financial eleme

17、nts:l historical costü the amount originally paid for the asset,l amortized costü historical cost adjusted for depreciation, amortization, depletion, and impairmentl current costü the amount the firm would have to pay today for the same assel realizable valueü the amount for whic

18、h the firm could sell the assetl present valueü the discounted value of the asset's expected future cash flowsl fair valueü the amount at which two parties in an arm's-length transaction would exchange the asset11-387Financial statementsØThe statement of comprehensive incomel

19、The statement of comprehensive income reports all changes in equity expect for shareholder transactions (e.g., issuing stock, repurchasing stock, and paying dividends).ü Under IFRSn the income statement can be combined with "other comprehensive income" and presented as a single statem

20、ent of comprehensive income.n Alternatively, the income statement and the statement of comprehensive income can be presented separately.ü Presentation is similar under U.S. GAAP except that firms can choose to report comprehensive income in the statement of shareholders' equity.The statemen

21、t of changes in equityl The statement of changes in equity reports the amounts and sources of changes in equity investors' investment in the firm over a period of time.Ø12-387Other relevant information13-387Financial statement notes (Footnotes) Providing information about accounting methods

22、,assumptions, and estimates Providing additional information about business acquisitions or disposal, legal actions, employee benefit plans, significant customers, sales to related parties, and segments of the firm Are auditedSupplementary schedules Operating income or sales by region or business se

23、gment Reserves for an oil and gas company Information about hedging activities and financial instrumentsManagements Discussionand Analysis (MD&A)Providing an assessment of the financial performance and condition of a company from the perspective of its management Results from operations, with a

24、discussion of trends in salesand expense Capital resource and liquidity, with a discussion of trends in cash flow A general business overview based on known trends Material events and uncertainties that may affect the futureOther relevant information14-387Quarterly or semiannual reports The most upd

25、ated information on the major financialstatements and footnotesSecurities and Exchange Commission (SEC) filings Form 8-K Acquisitions or disposals of major assets Changes in its management Changes in corporate governance Form 10-K Annual financial statements Form 10-Q Quarterly financial statementsP

26、roxy statements Issued to shareholders when there are matters that require a shareholder vote Providing information about thmembers, managements, compensation and the issuance of stock options.Corporate reports and press releases Public relationsOther necessary information Information on economic co

27、nditions, industry andcompetitors.AuditingØA principal agent relationshipPrincipalShareholdersBoard of directors (BOD)AgentManagementüExamines the companys accounting and internal control systems,Generally tries to determine that there are no material errors in the financial statementsUnde

28、r U.S. Generally Accepted Accounting Principles(GAAP), the auditor must state its opinion on the companys internal controlExternal auditors(Public accountants)üüCompany15-387AuditingØAuditl Definition: Audit is independent review of an entitys financial statementsby an independent acc

29、ounting firm.l The audit process provides a basis for the independent auditor to express anaudit opinion on the fairness of the financial statements that were audited.l Objective: auditor provides reasonable assurance that thestatements are fairly presented.financial16-387Auditing17-387Adverse opini

30、onQualified opinionDisclaimer of opinionUnqualified opinionThe standard auditors opinion1Whereas the financial statements are prepared by management and are its responsibility , the auditor has performed an independent review.2Generally accepted auditing standards were followed, thus providingreason

31、able assurance the financial statements contain no material errors.3The auditor is satisfied that the statements were prepared in accordance with accepted accounting principles and that the principles chosen and estimates madeare reasonable.ResultsAuditingØThe standard auditors opinionl Unquali

32、fied (clean) opinion: free from material errors, fraud, or illegal actsl Qualified opinion: if statements make any exceptions to the accounting principles, can issue qualified opinion and explain the exceptionsl Adverse opinion: if not presented fairly or not materially conforming with accounting st

33、andards.l Disclaimer of opinion: If the auditor is unable to express an opinion (e.g., in the case of a scope limitation), a disclaimer of opinion is issued.Internal control systeml the processes by which the company ensures that it presents accurate financial statements.l Internal controls are the

34、responsibility of management.l Under U.S. Generally Accepted Accounting Principles (GAAP), the auditor must express an opinion on the firm's internal controls.ü The auditor can provide this opinion separately or as the fourth element of the standard opinion.Ø18-387Financial statement a

35、nalysis framework19-387PhaseSources of infoOutput1. Articulate the purpose and context of the analysis Nature Needs & concern Guidelines Statement of purposes and objectives A list of specific questions Timetable & budgeted resources2.Collect data Financial data Discussion Visits Organized F

36、/S Financial data table Complete questionnaires3.Process data Data from previous phase Adjusted F/S Common size statements Ratios & Forecasts4.Analyze/interpret the processed data Input data Processed data Analytical results5.s &recommendations Analytical results Analytical reports recommend

37、ation6.Follow up Periodically repeating Updated reports & recommendationsBasic concepts: Example 1ØExample 1A companys current financial position would best be evaluated using theA. balance sheet.B. income statement.C. cash flow statementAnswer:A is correct.ü The balance sheet portrays

38、 the current financial position.ü The income statement and cash flow statement present different aspects of performance.Ø20-387Basic concepts: Example 2ØExample 2A companys profitability for a period would best be evaluated using theA. balance sheet.B. income statement.C. cash flow st

39、atement.Answer:B is correct.ü Profitability is the performance aspect measured by the income statement.ü The balance sheet portrays the current financial position.ü The cash flow statement presents a different aspect of performance.Ø21-387Basic concepts: Example 3ØExample 3A

40、ccounting methods, estimates, and assumptions used in preparingfinancial statements are foundA. in footnotes.B. management s discussion and analysisC. in the proxy statement.Answer:A is correct.ü The footnotes disclose choices in accounting methods, estimates, and assumptions.Ø22-387Basic

41、concepts: Example 4ØExample 4Information about material events and uncertainties would best be found inA. footnotes.B. the proxy statement.C. management s discussion and analysisAnswer:C is correct.ü This is a component of managements discussion and analysis.Ø23-387Financial statement

42、 analysis framework: Example 5ØExample 5Ratios are an input into which step in the financial analysis framework?A. Process data.B. Collect input data.C. Analyze/interpret the processed data.Answer:C is correct.ü Ratios are an output of the process data step but are an input into the analyz

43、e/interpret data step.Ø24-387F.R.AØ SS7l R22: Financial Statement Analysis: An Introductionl R24: Financial Reporting StandardsØ SS8l R25: Understanding the I/Sl R26:Understanding the B/Sl R27: Understanding the C/Fl R28: Financial Analysis TechniquesØ SS9Ø R29: Inventories&

44、#216; R30: Long-Lived AssetsØ R31: Income TaxesØ R32: Long-Term Liabilities and LeasesØ SS10Ø R33: Financial Reporting QualityØ R34: Financial Statement Analysis: Applications25-387l R23: Financial Reporting MechanicsFramework1.Financial Statement elements2.Flow of informati

45、on in an accounting system3.Double Entry Theory4.Accounting equationl Financial statement elements and relationshipsl Accrual accounting5.Cash accounting & cash flow statements26-387Classification of business activitiesØOperating activitiesl Activities that are part of the day-to-day busine

46、ss functioning of an entity.l Examples: the sale of meals by a restaurant, the sale of services of a consulting firm, etcInvesting activitiesl Activities associated with acquisition and disposal of long-term assets.l Examples: the purchase of equipment or sale of surplus equipment by a restaurant, a

47、nd the purchase or sale of an office building, a retail store, or a factory.Financing activitiesl Activities related to obtaining or repaying capital.l Two primary sources for funds are owners(shareholder) or creditors.l Examples: issuing common shares, and issuing bondsØØ27-387Financial S

48、tatement elementsØFinancial statement elements are the major classifications of assets, liabilities,owners' equity, revenues, and expenses.ØAccounts are the specific records within each element where various transactions are entered.l On the financial statements, accounts are typically

49、 presented in groups suchas "inventory" or "accounts payable."ØA company's chart of accounts is a detailed list of the accounts that make up the five financial statement elements and the line items presented in the financialstatements.ØContra accounts are used for e

50、ntries that offset some part of the value ofanother account.28-387Financial Statement elementsØClassifying Accounts Into the Financial Statement Elementsl Assetsl Liabilityl Owners equityl Revenuel Expenses29-387Financial Statement elements - AssetsØAssets are the firm's economic resou

51、rces. Examples of assets include:Cash and cash equivalents. Liquid securities with maturities of 90 days orless are considered cash equivalents.Accounts receivable. Accounts receivable often have an "allowance for bad debt expense" or "allowance for doubtful accounts" as a contra

52、 account.Inventory.Financial assets such as marketable securities.Prepaid expenses. Items that will be expenses on future income statements.Property, plant, and equipment. Includes a contra-asset account for accumulated depreciation.Investment in affiliates accounted for using the equity method.Defe

53、rred tax assets.Intangible assets. Economic resources of the firm that do not have a physical form, such as patents, trademarks, licenses, and goodwill. Except for goodwill, these values may be reduced by "accumulated amortization."lllllllll30-387Financial Statement elements - Liabilities&

54、#216;Liabilities are creditor claims on the company's resources. Examples of liabilities include:l Accounts payable and trade payables.l Financial liabilities such as short-term notes payable.l Unearned revenue. Items that will show up on future income statements as revenues.l Income taxes payab

55、le. The taxes accrued during the past year but not yet paid.l Long-term debt such as bonds payable.l Deferred tax liabilities.31-387Financial Statement elements - Owners equityØOwners' equity is the owners' residual claim on a firm's resources, which is theamount by which assets exc

56、eed liabilities. Owners' equity includes:Capital. Par value of common stock.Additional paid-in capital. Proceeds from common stock sales in excess of par value. (Share repurchases that the company has made are represented in the contra account treasury stock.)Retained earnings. Cumulative net in

57、come that has not been distributed as dividends.Other comprehensive income. Changes resulting from foreign currency translation, minimum pension liability adjustments, unrealized gains and losses from cash flow hedging derivatives, or unrealized gains and losses from available - for - sale.llll32-387Financial Statement elements - Expe