FINA Financial Statement Analysis & Liquidity Fall 2017 Tuesday/Thursday 11:00 am 12:20 pm, BLB 155

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1 FINA Financial Statement Analysis & Liquidity Fall 2017 Tuesday/Thursday 11:00 am 12:20 pm, BLB 155 Instructor: Lisa K. McDaniel, MBA, CFA Office Hours: Tuesday & Thursday 2:00 3:30 pm or by appointment Office: BLB 331E Telephone: E mail: lisa.mcdaniel@unt.edu Please use my UNT rather than the Blackboard function, as I check this regularly and will be able to respond more quickly to your concerns. You must reference the course (FINA 4300) in the subject of your . Please note that sent to my UNT address may occasionally be sent to a spam folder. If you do not hear back from me within a few days, please contact me again or see me in class. Also note that no information about your grades can be discussed or relayed other than in person or through Blackboard. If you call my office and receive my voic , please leave a message including your name, telephone number and reason for calling if you want me to return your call. I do not return missed calls if there is no voic . Course Materials Text (REQUIRED): Analysis for Financial Management, 11 th edition, by Robert C. Higgins. There are a few different options for purchase. You can buy the book at the UNT bookstore, or you can purchase the book and Connect directly from these websites: Textbook: The ebook version comes with an online component, McGraw Hill Connect. If you use a hard copy of the book, the Connect module is optional. It is not required. Text (REQUIRED): Understanding Financial Statements, 11 th edition, by Lyn Fraser and Aileen Ormiston There are a few different options for purchase. You can buy the book at the UNT bookstore, or you can purchase (or rent) the book directly from these websites: Financial Statements 11th Fraser/dp/ /ref=dp_ob_image_bk financial statements Case Studies (REQUIRED): We will review a minimum of three case studies during the semester. Assignments based on these cases will be turned in for grading. The case study materials can be purchased at: Calculator (REQUIRED) A financial calculator is required for in class use, for quizzes and for exams. Your calculator should be able to solve for internal rates of return using uneven cash flows, such as the TI BAII Plus calculator or the HP 12C. However, no programmable information is allowed in the calculator that you use for 1

2 exams. You will be required to clear the calculator of any programmed information before starting the exam. I will use the TI BA II Plus in class. Tutorials on how to use this calculator can be found here: WSJ (Recommended) You should also read the Wall Street Journal regularly during the course. You can buy a 15 week subscription for $15 at if you do not already have access. Reading the WSJ and other business publications is an important habit for everyone employed or interested in a business discipline. Blackboard Learn This course will use Blackboard Learn for assignments, lecture notes, grades, etc. You are responsible for checking regularly for announcements and new content. To get started with the course, please go to: You will need your EUID and password to log in to the course. If you do not know your EUID or have forgotten your password, please go to: Course Objectives: The course is intended to provide students with principles and tools required for corporate financial management, specifically using financial statement information to make business decisions. By increasing their understanding of and ability to analyze financial statements, students should learn to: Concisely articulate the firm s past performance Understand and describe the current operating environment Develop informed expectations about future performance Compare performance among companies within the same industry and analyze trends over time within companies. Course Description: This course analyzes issues related to corporate liquidity problems and solutions related to the management of short term assets and liabilities. It will also focus on analysis and interpretation of financial statement reports. Effective financial statement evaluation is examined from the perspective of managers, investors, and creditors. Emphasis is on the managerial implications of financial statement analysis. Topics to be covered in this course include: Financial statement analysis (balance sheet, income statement, statement of cash flow) Management of existing company resources using financial statements and ratio analysis Acquisition and management of new resources using financial forecasting Financing of company operations and evaluation of investment opportunities Mitigation of various risks faced by modern financial institution managers. Prerequisites: Completion FINA 3770 with a grade of C or better. 2

3 About the Course: In this class we combine readings with practice. I will also introduce some material that is not in the textbook, so attendance is important. Homework is an essential part of the class whether or not it is turned in for credit. After each lecture, you will work problems designed to reinforce your understanding and ability to use the information covered. Doing so will help you master the exams. NOTE: No credit will be given for late assignments. Grading Policy: Case Studies/Homework 30% Midterm Exams (2) 50% Final Exam 20% Grading Scale: 90% 100% A % B % C % D 59.9% or below F The Final Exam is comprehensive. It is an in class, closed book, closed note exam. You will be provided with a reference sheet. My Expectations: I expect you to read the text and take notes, attend class and participate in discussion during class, master the end of chapter problems and take exams throughout the term. Read each chapter before the lecture. Listen and take notes during the lecture. The slides provided are intended as an overview of chapter concepts but are not sufficient notes on their own. ARRIVE TO CLASS ON TIME. On time arrival shows respect for both fellow students and faculty and enhances learning by reducing distractions. Once you are in class, stay there. Do not walk in and out or leave early. After each lecture, revise your notes as needed, and then attempt the chapter s homework problems. Use the answer keys, discussion boards, a member of your study group, or phone or visit me during my office hours to master the more difficult problems. Class participation is crucial for your understanding of the key concepts, examples and questions. We will spend time in class working examples and problems. This will give you the opportunity to ask me for help with your specific concerns. I hold you responsible for all material covered during class, including changes to the syllabus, course schedule, and course materials. If you miss a class, it is your responsibility to obtain any handouts or notes from other students in class. 3

4 Teamwork: Your Skills and Backgrounds Differ. As faculty, we assume adequate knowledge of economics, algebra, calculus and spreadsheet and word processing skills will exist in all business school students so we will develop some of those skills in this class. While everything that you need to remember from other courses is reviewed briefly in the appropriate section of this course, you may need to refer to other textbooks, the resources available in the library, and your fellow classmates to be able to master every concept in this course. I strongly recommend that you work together in study teams. However, there is no collaboration allowed on quizzes or exams. Finance Tutor Lab Homework Assistance: The Finance Academic Assistance Lab has hours during the week and offers access. It is a great place to go to learn finance. Please drop by the Finance Tutor Lab to do your homework in a place where you can ask fellow students some questions. The lab (BLB 132) is located in the northeast corner of the first floor in the Business Leadership Building. More information is available at General Policies: Exams: We will have three midterm exams and one comprehensive final exam (proctored in a classroom on campus, on paper, closed book, closed note). A reference sheet with any necessary formulas will be provided for you. The lowest midterm exam score will be dropped, so the best two out of three will count toward your course grade. Please note that I will not answer exam related questions in the 24 hour period before an exam. A financial calculator with all programmable text cleared is required for each exam. No other information can be used on the midterms or final exam, unless previously authorized. Cell phones are not to be used as a substitute for a calculator. All laptops, tablets, cell phones, pagers, two way communications devices, and any electronic device other than the financial calculators approved for this class must be turned off and put away during the exams. Hats must be removed and earphones/ear buds cannot be used during the exam. You are not to leave the classroom during an exam unless there is an emergency and you receive permission from the proctor or me. You are not allowed to collaborate on any midterm exam or on the final exam. Unauthorized collaboration is treated as academic dishonesty. Exam Retention: I keep all exam papers. Once the exams are graded, I will hand them out in class and review the exam. You are required to hand your exam back to me. If I find any exam copies missing your grade will be permanently changed to 0. You are always welcome to come to my office to review past exams. Missed Exams: Since only two out of three of your midterm exams (not including the final) count toward your grade, there will be no makeup exams. If you have to miss an exam, then that score will be dropped. The final is required and that score will not be dropped. Incomplete Grades: A grade of incomplete can only be assigned if you are in compliance with the University policy regarding incomplete grades. You must see me to arrange an incomplete before the final exam is administered. Attendance: You will need to choose a seat and stay there for the entire semester. A seating chart will be created during the second week of class. I reserve the right to change the seating pattern during 4

5 exams. The class is interactive, and your participation in class discussions is important. Failing to participate will directly impact your grade. E mail accounts: All students should activate and regularly check their EagleConnect (e mail) account. EagleConnect is used for official communication from the University to students. Many important announcements for the University and College are sent to students via EagleConnect. For information about EagleConnect, including how to activate an account and how to have EagleConnect forwarded to another e mail address, visit Technical Requirements/Assistance: The following information has been provided to assist you in preparation for the technological aspect of the course. UIT Help Desk: Hardware and software necessary to use Bb Learn: Browser requirements: Computer and Internet Literacy: Necessary plug ins: Internet Access with compatible web browser Accommodation for Disabilities: The College of Business Administration complies with the Americans with Disabilities Act in making reasonable accommodation for qualified students with disabilities. If you have an established disability as defined in the Americans with Disabilities Act and would like to request accommodation, please notify me as soon as possible. For additional information see the Office of Disability Accommodation website at You may also contact them by telephone at (940) Acceptable Student Behavior: Student behavior that interferes with an instructor s ability to conduct a class or other students' opportunity to learn is unacceptable and disruptive and will not be tolerated in any instructional forum at UNT. Students engaging in unacceptable behavior will be directed to leave the classroom and the instructor may refer the student to the Dean of Students to consider whether the student's conduct violated the Code of Student Conduct. The university's expectations for student conduct apply to all instructional forums, including university and electronic classroom, labs, discussion groups, field trips, etc. The Code of Student Conduct can be found at Academic Dishonesty: Students caught cheating or plagiarizing will receive a "0" for that particular assignment or exam. Additionally, the incident will be reported to the Dean of Students, who may impose further penalty. In my classes, the appropriation or use of old tests or publisher test banks for any purpose is not authorized and therefore constitutes cheating. According to the UNT catalog, the term "cheating" includes, but is not limited to: a) use of any unauthorized assistance in taking quizzes, tests, or examinations; b) dependence upon the aid of sources beyond those authorized by the instructor in writing papers, preparing reports, solving problems, or carrying out other assignments; c) the acquisition, without permission, of tests or other academic material belonging to a faculty or staff member of the university; d) dual submission of a paper or project, or resubmission of a paper or project to a different class without express permission from the instructor(s); or e) any other act designed to give a student an unfair advantage. The term "plagiarism" includes, but is not limited to: a) the knowing or negligent use by paraphrase or direct quotation of the published or unpublished work of another person without full and clear acknowledgment; and b) the knowing or negligent unacknowledged use of materials prepared by 5

6 another person or agency engaged in the selling of term papers or other academic materials. Modifications during the Semester: Although I do not intend to vary substantially from this syllabus, I may change particular policies and assignments listed on this syllabus during the semester to better enhance learning in this class or to correct typographical errors. All of these changes will be announced in class and on Blackboard. Please watch the announcements to ensure that you find out if any policies or due dates for assignments have been changed or added. Your Success: UNT endeavors to offer you a high quality education and to provide a supportive environment to help you learn and grow. And, as a faculty member, I am committed to helping you be successful as a student. Here s how to succeed at UNT: Show up. Find support. Take control. Be prepared. Get involved. Be persistent. To learn more about campus resources and information on how you can achieve success, go to succeed.unt.edu. Student Perceptions of Teaching (SPOT) Student feedback is important and an essential part of participation in this course. The student evaluation of instruction is a requirement for all organized classes at UNT. The short SPOT survey will be made available toward the end of the semester to provide you with an opportunity to evaluate how this course is taught. Please look for the in your UNT inbox. Simply click on the link and complete your survey. Once you complete the survey you will receive a confirmation that the survey has been submitted. For additional information, please visit the spot website at or spot@unt.edu. 6

7 Schedule (tentative and subject to change) Week Day Date Text Chapter Topic Assignment Due* 1Tues 29 Aug Introduction, review of syllabus. McGraw Hill Connect; Case Study 1 Thurs 31 Aug Higgins 1 Interpreting Financial Statements Read Higgins CH1 2Tues Higgins 5 Sep, Fraser Higgins CH1 Problems 1 Overview of Financial Statements Higgins CH1 Problems Read Fraser CH1 2 Thurs 7 Sep Fraser Overview of Financial Statements 1 Fraser CH 1 Problems Fraser CH1 Problems Fraser CH 1 Case Study Read Biolase Case Study 3Tues 12 Sep Fraser 2 Balance Sheet Read Fraser CH2 3 Thurs 14 Sep Balance Sheet 2 Fraser CH 2 Problems Fraser CH2 Problems Fraser CH 2 Case Study 4Tues 19 Sep Midterm Exam 1 4 Thurs 21 Sep Fraser Income Statement & Statement of 3 Stockholders' Equity Read Fraser CH3 5Tues 26 Sep Fraser Stockholders' Equity 3 Fraser CH3 Problems Fraser CH3 Problems Fraser CH 3 Case Study 5 Thurs 28 Sep Fraser 4 Statement of Cash Flows Read Fraser CH4 6Tues 3 Oct Fraser Statement of Cash Flows 4 Fraser CH 4 Problems Fraser CH4 Problems Fraser CH 4 Case Study 6 Thurs 5 Oct Fraser 5 Ratio Analysis Read Fraser CH5 7Tues 10 Oct Fraser Ratio Analysis 5 Fraser CH5 Problems Fraser CH5 Problems 7 Thurs 12 Oct Higgins Financial Forecasting 3 Higgins CH3 Problems Read Higgins CH3 Higgins CH3 Problems 8Tues 17 Oct Midterm Exam 2 8 Thurs 19 Oct Higgins 4 Managing Growth Read Higgins CH4 Managing Growth Higgins CH4 Problems Higgins CH4 Problems Review Applied Materials Chapter 5 9 Tues 24 Oct Higgins 4 Jones Electrical Case Study Case Study 9 Thurs 26 Oct TBD 10 Tues 31 Oct Higgins 6 The Financing Decision Read Higgins CH6 The Financing Decision Higgins 10 Thurs 2 Nov Higgins 6 CH6 Problems Higgins CH6 Problems 11 Tues 7 Nov Higgins 6 Case Study: Blaine Kitchenware Case Study: Blaine Kitchenware 11 Thurs 9 Nov Higgins 7 Discounted Cash Flow Techniques Read Higgins CH7 12 Tues 14 Nov Higgins Discounted Cash Flow Techniques 7 Higgins CH7 Problems Higgins CH7 Problems 12 Thurs 16 Nov Higgins 7 Case Study: Energy Gel Case Study: Energy Gel 13 Tues 21 Nov Midterm Exam 3 13 Thurs 23 Nov Thanksgiving 14 Tues 28 Nov Higgins 8 Risk Analysis in Investment Decisions Read Higgins CH8 14 Thurs 30 Nov Higgins Risk Analysis in Investment Decisions 8 Higgins CH8 Problems Higgins CH8 Problems 15 Tues 5 Dec Higgins 9 Business Valuation and Corporate Restructuring Read Higgins CH9 Higgins CH9 Problems 15 Thurs 7 Dec 9 Case Study: Adecco Case Study: Adecco Tues Final Exam Review Tues 12 Dec Final Exam 10:30 am 12:30 pm *Assignments in Bold will be turned in for credit 7