Financial Statement Analysis

Recommended Prerequisites

Financial Accounting

Teaching Methods

Expository lectures introduce students to the main concepts coupled with more practical lectures aimed at the problem-solving and motivating class discussion on the subjects taught. The active participation of students is strongly encouraged, namely through the discussion of real cases, and it is planned to use online databases with economic and financial information about companies

Learning Outcomes

The financial analysis encompasses a set of methods and techniques that support the issuance of an opinion on the recent economic and financial performance and evolution prospects of an organization or project. At the end of this course, students should be able to relate the information contained in the different summary accounting pieces, analyze the different elements necessary to issue an informed opinion on the company's global economic and financial situation, support the elaboration of a global report of economic and financial analysis of the company, and assess the feasibility of investment projects.

Work Placement(s)

No

Syllabus

1. Introductory concepts

1.1. Concept and uses of financial analysis

1.2. Guiding principles of economic and financial diagnosis

2. The basic elements of the analysis

2.1. Accounting and extra accounting information

2.2. Financial analysis tools and the global report preparation

3. Analysis of the financial area

3.1. The permanent and universal condition of solvency

3.2. Financial analysis of growth. The sustainable growth rate.

4. Analysis of the economic area

4.1. The imperative of profitability

4.2. Return on investment and value creation

5. Risk analysis

5.1. The firm structure and operational and financial risk

5.2. Credit Scoring and Rating

6. Introduction to the evaluation of investment projects.

6.1. Preparation of project cash flow maps

6.2. Assessment criteria (Payback, IRR, NPV, ANPV, FCF/WACC) and risk analysis

Assessment Methods

Assessment
Periodic or by final exam as given in the course information: 100.0%

Bibliography

Fernades, C., Peguinho, C., Vieira, E., Neiva, J., 2022, Análise Financeira - Teoria e Prática - Aplicação no âmbito do SNC 6ª Edição, Edições Silabo

Gama, P., Torres, P., 2021, Exercícios de Análise Financeira 4ª ed., Edições Almedina

Neves, J., 2012, Análise e Relato Financeiro – Uma visão Integrada de Gestão 5ª ed., Texto Editores