Financial Reporting and Analysis

This unit develops students’ abilities to measure, record, and analyze key financial reporting elements—cash flows, depreciation, inventory, debt, leases, and equity—and to interpret related disclosures. It emphasizes preparing financial statement schedules and journal entries, applying GAAP/FASB guidance, and evaluating reports and notes (including Form 10-K) for accuracy and transparency.

Learning Objectives

• Analyze and prepare statements of cash flows using both indirect and direct methods by classifying operating, investing, and financing activities and reconciling net income to net cash changes
• Apply depreciation and inventory valuation methods (straight-line, declining-balance, units-of-production, FIFO, LIFO, weighted-average) to compute expense, prepare depreciation schedules, and assess effects on net income and book-vs-tax calculations
• Demonstrate accounting for bond issuances, lessor/lessee lease transactions, research and development costs, and equity transactions by recording journal entries, amortization schedules, and ledger postings
• Evaluate annual reports, Form 10-K disclosures, explanatory notes, and FASB guidance to identify unusual or misleading income statement items, reductions to stockholders’ equity, and recommend improved cash management or reporting practices