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Unformatted text preview: Chapter 05 - Financial Reporting and Analysis CHAPTER 5 FINANCIAL REPORTING AND ANALYSIS Student Learning Objectives and Related Assignment Materials Student Learning Objectives Mini- Exercises Exercises Coached Problems Problems (Groups A & B) Skills Development Cases Multi- chapter Material 1. Explain the needs of financial statement users. 1 1, 5, 6, 7, 10, 11* 4, 5 2. Describe the environment for financial reporting, including the Sarbanes- Oxley Act. 2 4, 5, 6 3. Prepare a comparative balance sheet, multistep income statement, and statement of stockholders equity. 4*, 5*, 6, 8, 10* 12, 14, 16* 1 A1, B1 5 4. Describe other significant aspects of the financial reporting process, including external audits and the distribution of financial information. 3 1, 2, 3, 4, 6, 7, 9 5. Explain the reasons for, and financial statement presentation effects of, IFRS. 11 15 4 A4, B4 6. Compare results to common benchmarks. 15 14 4 A4, B4 2, 3, 7 7. Calculate and interpret the debt-to-assets, asset turnover, and net profit margin ratios. 4*,7, 9*, 12, 13, 14, 15 6, 7, 8, 10, 11*, 13, 14 2, 3, 4 A2, A3, A4, B2, B3, B4 1, 2, 3 , 4, 5, 6, 7 CC5 * Animated solution included in the PowerPoint Slides. CC5 is a continuing case that builds on the story of Nicoles Getaway Spa, introduced in earlier chapters. This case focuses on analyzing transactions to determine the impact on the financial statements and the debt-to-assets, asset turnover, and net profit margin ratios. This case will be extended in future chapters. 5-1 Chapter 05 - Financial Reporting and Analysis Overview Expanding from accounting for a small business (covered in chapters 1 through 4), we explore the environment in which a public company in the United States (Activision Blizzard) releases its financial results and its European parent company (Vivendi) reports globally using International Financial Reporting Standards. Students learn about big picture topics, including financial statement fraud, the Sarbanes-Oxley Act, IFRS, and analyzing financial statements to reveal the effects of the recent economic turmoil. Synopsis of Chapter Revisions New chapter opener New Spotlight on Business Decisions explaining accountings role in the Treasury Departments stress test for banks New Self-Study Practice on financial statement articulation New Spotlight on Financial Reporting introducing XBRL New section on financial statement presentation under GAAP and IFRS New financial statement analyses including two U.S. companies and one European competitor New section explaining how transactions affect ratios Three new questions, two new mini-exercises, one new exercise, three new problems, and three new case One new continuing case PowerPoint Slides Student Learning Objective PowerPoint Slides 1. Explain the needs of financial statement users. 5-1 through 5-3 2. Describe the environment for financial reporting, including the Sarbanes- Oxley Act....
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