0707 S3INTA1 Financial Statement Analysis
PD Tobias Bornemann, Ph.D.
Contact details
Weekly hours
Language of instruction
09/02/22 to 09/25/22
Registration via LPIS
Notes to the course
Subject(s) Master Programs
Day Date Time Room
Tuesday 11/29/22 09:00 AM - 12:30 PM D4.0.136
Friday 12/09/22 10:00 AM - 01:30 PM D4.0.136
Friday 12/16/22 10:00 AM - 01:30 PM D4.0.136
Monday 12/19/22 01:00 PM - 04:30 PM D5.1.003
Friday 01/13/23 10:00 AM - 01:30 PM D4.0.136
Friday 01/20/23 10:00 AM - 01:30 PM D4.0.136
Friday 01/27/23 10:00 AM - 12:00 PM D4.0.022

This course will be held in English


The goal of the course is to teach students how to perform financial statement analysis and business valuation. It introduces corporate reporting as one of the main information sources for business decision makers and provides insights into the usefulness and limitations of financial statement analysis in different decision contexts (e.g., investment decisions).

Students learn the financial statement analysis tools that enable them to practically conduct business valuation, including industry and corporate strategy analysis, accounting analysis, financial analysis, forecasting methods and valuation models.

Learning outcomes

After completing this course the students will have the ability to:

  • Use IFRS-based financial statements as one of the main sources of information for conducting a wide range of business analyses, such as
    • Link a firm’s accounting information with its strategy;
    • Identify red flags of potential misrepresentation in financial statements;
    • Reformulate financial statements (i.e., balance sheet, income statement and cash flow statement);
    • Make accounting adjustments to “undo” accounting distortions and to properly capture a firm’s economics;
    • Compute a firm’s financial ratios and interpret ratios from an analyst’s perspective;
    • Use financial ratio analysis to evaluate a firm’s operating, investment and financing efficiency;
    • Forecast financial statements;
    • Value a firm using various valuation techniques such as valuation multiples, dividend discount model, discounted cash flow model and discounted abnormal earnings model.
  • Apply common tools of financial statement analysis to conduct a comprehensive analysis
  • Prepare forecasted financial statements as the basis for valuation 
  • Apply accounting-based valuation models

After completing this course the students will also have the ability to: 

  • Confidently conduct financial statement analysis in various decision contexts (like from the perspective of managers, security analysts etc.)
  • Recognize the most important aspects of the analysis depending on the decision context
  • Acknowledge the need for and potential sources of additional information required for conducting a comprehensive analysis

Formulate a final valuation decision resulting from the comprehensive analysis

Attendance requirements

Prüfungsimmanente Lehrveranstaltung: 80% minimum. 

Teaching/learning method(s)

The teaching material is based on an international text book. Part of the material is presented during lectures and part of it is intended for self-study. Numerous examples and cases of European firms are used to support the discussion of business analysis and valuation throughout the course. Working through problems and exercises, at the lectures and individually, further reinforces the material covered and encourages analytical thinking.


The course evaluation is based on (1) a term project (40%), (2) in-class participation (20%) and (3) a final exam (40%). 

(1) Term project (40%)

The project is designed for students to practice the kind of unstructured problems often emerging in the business world.  As part of the project, students complete four homework assignments at predetermined dates. In each assignment students perform consecutive steps of financial statement analysis of a real world company. Based on these homework assignments, a final report is due at the end of the course that summarizes and elaborates the results of the financial statement analysis. The final grade of the project is based on the homework assignments and the final report:

  • 5% Homework 1 "Company Overview"
  • 5% Homework 2 "Template Ratio Analysis"
  • 5% Homework 3 "Template Forecasting"
  • 5% Homework 4 "Template Valuation"
  • 20% Final Report

In total the project constitutes 40% of the course grading.

(2) In-class participation (20%):

Students must read and prepare cases that are discussed in class.

20% in-class participation.

(3) Exam (40%):

The final written exam covers the contents of the course.

40% Final Exam

1 Author: Palepu, Krishna G., Paul M. Healy, and Eric Peek

Business Analysis and Valuation: IFRS Edition

Publisher: Cengage Learning
Edition: 3
Remarks: Main Reading (This semester's lecture is based on edition 3 of the book!)
Year: 2013
Content relevant for class examination: Yes
Content relevant for diploma examination: No
Recommendation: Essential reading for all students
Type: Book
2 Author: Penman, Stephen H.

Financial Statement Analysis and Security Valuation

Publisher: Mcgraw-Hill
Year: 2012
Content relevant for class examination: Yes
Content relevant for diploma examination: No
Recommendation: Reference literature
Type: Book
3 Author: Alexander, David and Christopher Nobes

Financial Accounting – An International Introduction

Publisher: Prentice Hall
Year: 2010
Content relevant for class examination: No
Content relevant for diploma examination: No
Recommendation: Reference literature
Type: Book
Last edited: 2022-04-28