505: Financial Statement
Analysis (A)
Marks: 80
Unit–I:
Introduction 20
Meaning of
Financial Statement; Elements of Financial Statements – Assets, Liabilities, Equity,
Incomes and Expenses and their features; Constituents of Financial Statements –
Income Statement and Balance Sheet and their features; Information incorporated
in Financial Statements and their Qualitative requirements; Limitations of
Financial Statements.
Unit–II :
Statutory Requirements for preparation of Financial Statements: 20
Relevant
provisions of Companies Act 1956 for the preparation of Profit and loss
Account and
Balance Sheet; Corporate Financial Reporting - meaning, need and objectives,
Report of the Board of Directors, Contents of Annual report, Mandatory and Voluntary
Disclosures through Annual Report
Unit–III: Techniques
of Financial Statement Analysis 20
Meaning and
objectives of Financial Statement Analysis; Techniques of Financial Statement
analysis – Comparative Statement, Common-size Statement and Trend Analysis. Meaning
of Accounting Ratio, Classification of Accounting Ratios; objectives of Ratio Analysis;
Advantages and Limitations of Ratio Analysis; Precaution to be taken before using
Ratios; Computation of various Ratios – Activity Ratios, Liquidity Ratios,
Solvency and Leverage Ratios and Profitability Ratios.
Unit–IV:
Statements of Changes in Financial Position (SCFP): 20
Evolution of
SCFP; Funds Flow Statement – Meaning of Fund, Flow of Fund, Importance and
Limitations of Fund Flow Statement, Preparation of Fund Flow Statement and
Statement of Changes in Working Capital
Meaning of Cash
Flow Statement, Distinction between Fund Flow Statement and Cash Flow
Statement; Accounting Standard 3 and its salient features, Preparation of Cash Flow
Statement.
Recommended
Books:
Financial
Statement Analysis - S. Sikidar & H. C. Gautam, New Central
Management
Accounting - R. K. Sharma & S. K. Gupta, Kalyani Publishers, Ludhiana
Advanced
Management Accounting - R. S. Kaplan & A. A. Atkinson
Management
Accounting - M. Y. Khan & P. K. Jain, Tata McGrow Hill Co.
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