Module 1 – Accounting fundamentals and financial position
Chapters 1 and 2

The purpose of accounting and the distinction between accounting and bookkeeping. Accounting as an information system. The main users of accounting information and their interests. Stakeholders, value creation, the relationship between risk and return, and ethics.

An overview of the main financial statements. The Statement of Financial Position and the accounting equation:

Assets = Liabilities + Equity.

The effects of the main business transactions on the accounting equation. Classification of assets and claims. The distinction between current and non-current items. Basic accounting conventions and an introduction to measurement and valuation issues.

Module 2 – Financial performance, accrual accounting, and financial reporting rules
Chapters 3, 4, and 5

The Income Statement. Recognition of revenue and expenses, the structure of the statement, and the economic meaning of profit. The distinction between profit, cash, and accrual accounting.

The main accounting estimates affecting reported performance: depreciation, inventory costing, and trade receivables problems. The role of accounting estimates and an introduction to the concept of earnings quality.

The essential features of limited companies. Share capital, reserves, borrowings, and dividends. The role of accounting rules, accounting policies, directors, and auditors. Accounting choices and the risks associated with creative accounting.

Module 3 – Measuring and interpreting cash flows
Chapter 6

The importance of cash and the relationship between the Statement of Financial Position, Income Statement, and Statement of Cash Flows.

The definition of cash and cash equivalents. Classification of cash flows into operating, investing, and financing activities. The normal direction of cash flows.

Simplified preparation and interpretation of the Statement of Cash Flows. The relationship between profit and cash and the integrated interpretation of the three main financial statements.

Module 4 – Analysing and interpreting financial statements
Chapters 8 and 9

The purpose of ratio analysis and the need for comparison over time and between companies.

Profitability ratios, including ROCE and ROE. Efficiency ratios, including asset turnover, inventory days, and receivable days. The relationship between profitability and efficiency.

Liquidity ratios, including the current ratio and acid-test ratio. The operating cash cycle. Financial gearing and the relationship between debt, risk, and return.

Comparative analysis of competing companies. Introduction to common-size financial statements, trend analysis, and investment ratios. Limitations of ratio analysis and a brief introduction to the use of financial indicators in predicting financial distress.

Module 5 – From financial reporting to sustainability reporting
Selected topics from Chapter 7, Chapter 11, and additional lecturer materials

The development of financial reporting from stewardship reporting to decision-useful reporting and the expansion of information provided to stakeholders.

Introduction to sustainability reporting, ESG factors, and the concept of double materiality.

How environmental risks and initiatives may affect accounting figures: environmental provisions, contingent liabilities, impairment, and stranded assets. Effects on depreciation, CAPEX, OPEX, and cash flows.

An introductory overview of the CSRD and ESRS framework. The problem of greenwashing.

Guided analysis of the Annual Report and Sustainability Report of a large company. Identification of environmental KPIs, Scope 1, Scope 2, and Scope 3 emissions, sustainable investments, and major environmental risks. Assessment of the consistency between financial results and ESG statements.

Module 6 – Integration and exam preparation

Integrated application of the knowledge and skills developed throughout the course.

A timed online Mock Exam structured in a format similar to the final examination, including multiple-choice questions, short theoretical questions, and exercises on the accounting equation, profit, cash flows, financial ratios, and sustainability.

A reasoned review of the Mock Exam, discussion of the most frequent errors, and a final overview of the course.

Two additional teaching sessions may be used to review particularly challenging topics, conduct a workshop on a real Annual Report, provide additional ratio exercises, or hold a second Mock Exam.