PGDM Core Subject
Financial Reporting & Strategic Analysis
Course Objective
2. Course Description
This course empowers future leaders to interpret financial data as a strategic asset. Moving beyond traditional bookkeeping, the course focuses on "Financial Intelligence"—the ability to read what isn't explicitly stated. It integrates Digital Tools for modeling, Forensic Accounting for ethical governance, and Startup Valuation principles for entrepreneurial decision-making.
3. Course Objectives (Learning Goals)
- To decode the language of business (Ind AS/IFRS) for strategic communication with stakeholders.
- To master digital tools for constructing and modeling financial statements.
- To diagnose organizational health using advanced ratio analysis and the Du Pont framework.
- To instill ethical leadership by learning to detect fraud and earnings manipulation.
4. Course Outcomes (COs)
Mapped to Bloom’s Taxonomy and Taxila’s Program Outcomes.
|
CO Code |
Course Outcome Description |
Bloom's Level |
Primary PO Mapping |
|
CO1 |
Explain the regulatory framework, accounting cycle, and strategic purpose of financial statements. |
Understand (L2) |
PO1 (Mgmt Knowledge) |
|
CO2 |
Construct dynamic Balance Sheets, P&L, and Cash Flow models using Advanced Excel. |
Apply (L3) |
PO1 (Tech Integration) |
|
CO3 |
Analyze corporate performance using Ratio Analysis and Common-Size statements for strategic insights. |
Analyze (L4) |
PO2 (Critical Thinking) |
|
CO4 |
Evaluate the quality of earnings to identify "Creative Accounting," ethical red flags, and fraud risks. |
Evaluate (L5) |
PO7 (Ethics/Governance) |
|
CO5 |
Design a financial dashboard and Pitch Deck financial slide for a New Venture (Startup). |
Create (L6) |
PO5 (Entrepreneurship) |
5. CO-PO Articulation Matrix
Correlation: 3 (High), 2 (Medium), 1 (Low)
|
CO Code |
PO1 (Mgmt/ Tech) |
PO2 (Crit. Think) |
PO3 (Lead/ Team) |
PO4 (Comm.) |
PO5 (Entrep.) |
PO6 (Global/ ESG) |
PO7 (Ethics) |
PO8 (Life Learn) |
|
CO1 |
3 |
1 |
- |
- |
1 |
1 |
- |
1 |
|
CO2 |
3 |
2 |
- |
- |
2 |
- |
- |
3 |
|
CO3 |
2 |
3 |
- |
1 |
2 |
- |
- |
2 |
|
CO4 |
1 |
3 |
- |
- |
- |
1 |
3 |
- |
|
CO5 |
3 |
2 |
1 |
2 |
3 |
- |
- |
3 |
|
AVG |
2.4 |
2.2 |
1.0 |
1.5 |
2.0 |
1.0 |
3.0 |
2.25 |
6. Assessment Scheme (Taxila Standard)
|
Component |
Marks |
Description |
Mapped CO |
|
Simulation |
20 |
Taxila Lab Simulations: Three proprietary simulations. • Sim 1: The Digital Journal (Cycle). • Sim 2: The Cash Flow Engine. • Sim 3: The Startup Cap Table. |
CO2, CO5 |
|
Case Study |
10 |
"Forensic Detective": Analysis of a fraud case (HBS/IIMA) identifying red flags. |
CO4 |
|
Presentation |
10 |
"The Pitch": Group presentation defending the valuation of a startup or listed company. |
CO5 |
|
Mid Term |
10 |
Written exam covering Modules 1 & 2. |
CO1, CO2 |
|
Project |
10 |
"Equity Research": Ratio analysis project comparing two competitors. |
CO3 |
|
Class Participation |
10 |
Participation in case discussions and daily preparation. |
All |
|
End Term |
30 |
Comprehensive written exam covering all modules. |
All |
|
Total |
100 |
7. Detailed Syllabus & Session Plan
Each session assumes 90 minutes of class time + 60 minutes of pre-class preparation.
Module 1: The Language of Business (Sessions 1-5)
- Session 1: Financial Leadership & The Equation
Topic: Users of financial info, The Accounting Equation ($Assets = Liabilities + Equity$).
Pre-Class Prep
Read: R. Narayanaswamy, Chapter 1 ("Financial Accounting and its Environment").
Pedagogy: Interactive Lecture.
- Session 2: Regulatory Framework & Principles
Topic: GAAP vs. IFRS vs. Ind AS. Principles of Accrual, Consistency, and Conservatism.
Pre-Class Prep
Read Case: Revenue Recognition at Salesforce.com (HBS) OR Revenue Recognition at Groupon (IIM-A).
Pedagogy: Case Discussion (Revenue Recognition).
- Session 3: Mechanics of Accounting (The Journal)
Topic: Double Entry System, Debits & Credits, Journalizing transactions.
Pre-Class Prep
Read: R. Narayanaswamy, Chapter 3 ("Recording Transactions").
Pedagogy: Chalk & Talk / Problem Solving.
- Session 4: Taxila Lab Simulation 1
Topic: "The Digital Journal": Recording transactions in real-time for a fictional e-commerce company.
Pre-Class Prep
Task: Review the "Chart of Accounts" provided in the Simulation Manual.
Pedagogy: Simulation Lab (Taxila Lab Sim 1).
- Session 5: Closing the Books
Topic: Adjusting Entries (Prepaids, Accruals), Closing Entries, Preparation of Final Accounts.
Pre-Class Prep
Read: R. Narayanaswamy, Chapter 4 ("Preparation of Financial Statements").
Pedagogy: Problem Solving.
Module 2: Strategic Analysis of Statements (Sessions 6-12)
- Session 6: The Balance Sheet Strategy
Topic: Asset quality analysis (Intangibles vs. Tangibles), Liability structure.
Pre-Class Prep
Read Case: Ocado Group plc (HBS) - Focusing on Asset Structure.
Pedagogy: Live Analysis of a Tech Giant.
- Session 7: The P&L and Quality of Earnings
Topic: Revenue Recognition (Crucial for Tech), Expense classification (EBITDA), Non-recurring items.
Pre-Class Prep
Read: R. Narayanaswamy, Chapter 5 (Profit & Loss Section).
Pedagogy: Case Study (Zomato/Uber Analysis).
- Session 8: Cash Flow Statement - Operating
Topic: The Indirect Method. Why "Cash is King".
Pre-Class Prep
Read Case: Statements of Cash Flows: Three Examples (HBS) - Identifying the healthy company.
Pedagogy: Lecture & Calculation.
- Session 9: Taxila Lab Simulation 2
Topic: "The Cash Flow Engine": Generating a dynamic Cash Flow Statement from a disorganized list of transactions.
Pre-Class Prep
Task: Review the "Indirect Method" format in the textbook.
Pedagogy: Simulation Lab (Taxila Lab Sim 2).
- Session 10: Liquidity & Solvency Analysis
Topic: Current Ratio, Quick Ratio, Debt-Equity (Analyzing Leverage).
Pre-Class Prep
Read: R. Narayanaswamy, Chapter 11 ("Financial Statement Analysis" - Liquidity Ratios).
Pedagogy: Comparative Analysis Workshop.
- Session 11: Profitability & Efficiency
Topic: Margins (Gross/Net), Asset Turnover, Inventory Days.
Pre-Class Prep
Read Case: Financial Statement Analysis of Tata Motors (IIM-B/IIM-A).
Pedagogy: Problem Solving.
- Session 12: The Du Pont Analysis
Topic: Deconstructing ROE ($Margin \times Turnover \times Leverage$).
Pre-Class Prep
Read: R. Narayanaswamy, Chapter 11 (Du Pont Analysis Section).
Pedagogy: Visual Mapping Workshop.
Module 3: Valuation, Entrepreneurship & Ethics (Sessions 13-17)
- Session 13: Fixed Assets & Depreciation Strategy
Topic: SLM vs. WDV, Impairment of Assets.
Pre-Class Prep
Read: R. Narayanaswamy, Chapter 6 ("Property, Plant, and Equipment").
Pedagogy: Lecture.
- Session 14: Inventory & Valuation
Topic: FIFO vs. Weighted Average. Impact of Inflation.
Pre-Class Prep
Read Case: Inventory Management at Micromax (IIM-A).
Pedagogy: Case Discussion.
- Session 15: Taxila Lab Simulation 3
Topic: "The Startup Cap Table": Managing equity dilution through 3 rounds of funding (Seed, Series A, Series B).
Pre-Class Prep
Task: Read note on "Pre-Money vs. Post-Money Valuation" (LMS).
Pedagogy: Simulation Lab (Taxila Lab Sim 3).
- Session 16: Forensic Accounting (Ethics)
Topic: Detecting Fraud, Red Flags in Notes to Accounts, Earnings Management.
Pre-Class Prep
Read Case: The Satyam Computer Services Scandal (IIM-A) or Enron: The Smartest Guys in the Room (HBS extract).
Pedagogy: Case Study Assessment (Forensic Analysis).
- Session 17: Financial Visualization (Tech)
Topic: Introduction to Power BI/Tableau for Finance.
Pre-Class Prep
Task: Download sample dataset from LMS.
Pedagogy: Tech Lab.
Module 4: Capstone & Review (Sessions 18-20)
- Session 18: Annual Report Deep Dive
Topic: MD&A Analysis, Auditor's Report types.
Pre-Class Prep
Read: R. Narayanaswamy, Appendix on "Reading an Annual Report".
Pedagogy: Group Discussion.
- Session 19: Capstone Presentation (Part 1)
Topic: Presentation Assessment (10 Marks).
Pre-Class Prep: Finalize slides and rehearse.
Pedagogy: Student Presentations.
- Session 20: Capstone Presentation (Part 2)
Topic: Presentation Assessment (10 Marks) & Course Wrap-up.
Pedagogy: Student Presentations & Feedback.
8. Textbooks & Resources
- Mandatory Textbook: Financial Accounting: A Managerial Perspective by R. Narayanaswamy (PHI Learning).
- Case Studies: Selected cases as listed in session plan.
- Lab Resources:
Taxila Lab Sim 1: The Digital Journal.
Taxila Lab Sim 2: The Cash Flow Engine.
Taxila Lab Sim 3: The Startup Cap Table.