Course Details in 2025/26 Session


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Module Title LM Financial Statement Analysis and Business Valuation
SchoolBirmingham Business School
Department Finance
Module Code 07 36334
Module Lead Dr. Chun (Mark) Mak
Level Masters Level
Credits 20
Semester Semester 1
Pre-requisites
Co-requisites
Restrictions None
Contact Hours Lecture-30 hours
Seminar-10 hours
Guided independent study-160 hours
Total: 200 hours
Exclusions
Description This module introduces fundamental analysis that is an economic framework for business analysis and security valuation based on accounting information. The main focus is on integrating key concepts of economics, accounting and finance in order to effectively evaluate the information content of financial reports, derive forecasts and apply valuation techniques for the purpose of implementing investment strategies and consulting. All lectures are backed by relevant discussion on cutting-edge research in areas of Capital Market-based Accounting Research and Corporate Finance. Additionally, students are encouraged to analyze the quality of accounting information and to explore empirical studies concerned with the value relevance of accounting information by using real data from financial reports and electronic databases like CRSP, Datastream and ThomsonOne.com among others. Via these practices, students explore how the value of a stock or operating asset in an efficient market reflects investors’ expectations on its future performance. This module also equips students with key security analysis and valuation techniques commonly applied in trading rooms in financial industry. Throughout, this course also spends a reasonable amount of time on the role of theories and industry practices introduced in promoting ethical and sustainable business practices.

Some other topics that will be considered in this module include cash flow forecasting using EXCEL, financial modelling, simulation, stress testing in simulated scenarios, using EXCEL.
Learning Outcomes By the end of the module students should be able to:
  • appraise the accounting framework, the conceptual basis of financial reporting and non-financial disclosure, and financial statements, how the reported values may be affected by accounting policy choice and international differences in accounting practices;
  • analyse companies fundamentals to identify the firms’ profit drivers, their key risks and sources of finance, using financial metrics (ratios and flows) from published accounts;
  • apply different valuation and forecasting techniques to business and compare the foundation of relative valuation models, such as accruals-based and cash- flow-based models, P/E, book to market ratios, etc.; and
  • critically evaluate companies’ capital structures and credit risks.
Assessment 36334-01 : Credit Research Report : Coursework (50%)
36334-02 : Equity Research Report : Coursework (50%)
Assessment Methods & Exceptions Assessment
(a) a 1,500 words individual report (50%); and
(b) a 1,500 words individual assignment (50%).

Reassessment
Students who fail the module will resit the failed component(s) only.
Other
Reading List