The objective of the course is to provide students with the framework to conduct financial statement analysis and conduct performance evaluation.

In particular, regarding financial statement analysis, the course is designed to provide students with the conceptual background and analytical tools necessary to evaluate financial statements. We will discuss the financial statements, the differential effects of alternative accounting principles and their effects on reported performance, and the interpretation of financial information.

Then we present the main limitation of traditional financial performance looking at non-accounting based performance measures like the economic profit and the residual income.

The program of the course is in two main parts. The first part focuses on financial statement analysis. The second part deals with non-accounting measures of performance (e.g. economic profit and residual income). More in particular, the financial statement analysis part is designed to provide students with the conceptual background and analytical tools necessary to evaluate financial statements. It focuses on understanding the uses and the limitation of both the financial statements and the traditional and non-traditional methods used in analysing them. We will discuss the financial statements, the differential effects of alternative accounting principles and their effects on reported performance, and the interpretation of financial information. The part that refers to non-accounting measures of performance (e.g. economic profit and residual income) deals with the some concept towards the calculation of the firm value starting from accounting data.