A Financial Statement Analysis Project for Introductory Financial Accounting

5953 WordsNov 1, 201224 Pages
G lobal Perspectives on Accounting Education Volume 6, 2009, 83-96 A FINANCIAL STATEMENT ANALYSIS PROJECT FOR INTRODUCTORY FINANCIAL ACCOUNTING Marilyn B. Misch Business Administration Division Pepperdine University Malibu, California USA Carolyn A. Galantine Business Administration Division Pepperdine University Malibu, California USA ABSTRACT This paper describes a financial statement analysis project useful in both preparerbased and user-based introductory courses in financial accounting. The project requires students to analyze trends in corporate performance, to evaluate corporate financial decisions, to discuss non-financial statement issues that would be important to potential investors, to compare two companies within an industry,…show more content…
As a first step, the professors organize students into groups of four to five people, balancing the groups based on both academic major and performance in the class to date (including performance on homework and the first exam), as well as to achieve diversity. The group format is used to encourage students to learn from each other, to motivate students to consider alternative viewpoints, to develop students’ understanding of group dynamics, and to limit the amount of time required of the project for both students and the faculty who must grade it. Each professor uses a different approach in selecting the industry and companies for analysis. One professor takes industry suggestions from the class (with the restriction that there be sufficient companies so that no more than two groups will have to analyze the same pair of companies), writes the suggestions on the board, and asks students to vote for their top two choices. Then, a second vote is taken from among the top two original suggestions, with a majority vote determining the industry to be analyzed. Finally, groups have one week to send the professor an email proposing two companies to analyze, with first responders being given preference, so that no more than two groups analyze the same pair. 85 Misch and Galantine 86 The other professor announces group assignments near the end of a class session, then allows groups

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