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Syllabus:

Accounting Auditing and Control D, 30 Credits

Swedish name: Accounting Auditing and Control D

This syllabus is valid: 2017-08-28 and until further notice

Course code: 2FE107

Credit points: 30

Education level: Advanced level

Main Field of Study and progress level: Business Administration: second cycle, has only first-cycle course/s as entry requirements

Grading scale: VG Pass with distinction, G Pass, U Fail

Responsible department: Business Administration

Revised by: Rector of Umeå School of Business and Economics, 2017-06-09

Contents

This course covers topics related to financial reporting, how management accounting can be used to create value in companies, financial statement analysis and auditing.
The course is given and examined in English.

Generic learning outcomes.
The course has a number of goals for the development of generic competences. After completing the course, the student should be able to:

●    analyze and frame problems in the accounting area  
●    understand and evaluate accounting and auditing related issues from an ethical perspective
●    work effectively in team environments
●    plan conduct, and present investigations, both orally and in writing

Module 1. Advanced Financial Statement Analysis and Valuation, 7,5 credits
Module 2. Advanced Management Accounting, 7,5 credits
Module 3. Advanced Financial Accounting, 7,5 credits
Module 4. Advanced Auditing, 7,5 credits

Module 1. Advanced Financial Statement Analysis and Valuation, 7.5 credits
The module aims to provide students with relevant theories, methods and models for valuing companies and their securities, primarily equity (common stock). The module deals with the analysis of financial statement information and the use of this information for business strategy analysis, performance evaluation and investment decisions. Accounting and discounted cash flow approaches to valuation are discussed as are forecasting of dividends, earnings, cash flows and pro forma analyses. During the module, students will also be introduced to the code of academic conduct, e.g. referencing and avoidance of plagiarism and cheating.

Expected learning outcomes:
After successful completion of the module, the student should be able to:

●    value the equity, operations and debt of companies using different valuation approaches/models and financial statement information
●    analyze and reformulate financial statements to identify a firm’s business strategy and value drivers so as to facilitate forecasting and valuation
●    analyze market prices, value drivers and financial measures, e.g., profitability, growth, P/B and P/E ratios, and their relations to estimated fundamental value
●    explain the relations between accounting standards, e.g. IFRS and US GAAP, accounting methods and value
●    integrate environmental, social and corporate governance (ESG) factors into equity valuation
●    describe, recognize and apply the code of academic conduct to the student’s own work.

Focus of instruction:
Learning is supported by lectures, seminars, literature i.e. textbook and research articles, cases and projects. Students are expected to take an active part in every aspect of the module.

Module examination modes
Examination is based on an individual written exam, a maximum of two within module tests and an individual test of academic conduct. A passing grade is required for each part of the module. The course is given and examined in English. Note as well examination modes for the course below.

Module 2. Advanced Management Accounting, 7.5 credits
Management accountants are strategic financial management professionals who integrate accounting expertise with advanced management skills to drive business performance, with the postulate that the sustainability of a firm depends on its ability to recognize and benefit from its value drivers. With a solid theoretical framework, the course addresses modern issues in management control and performance measurement. The focus is on the enhancement of shareholder value through customer-driven value creation from a value-based management perspective. A second purpose of the course is to enhance students’ knowledge and analytical skills related to the way managers design, and utilize planning and management control systems to implement strategies. Techniques of the management control process are studied and behavioural considerations are discussed. The management accounting systems studied should provide information on the value drivers of organizations, to assist in aligning the self-interests of management with long-term shareholder wealth. The students will also become aware of the varied and changing roles of the management accountant.

Expected learning outcomes:
After completing this module, the student should:

●    analyse the roles of management accounting systems and contemporary management accounting processes in organizations
●    act as a catalyst, facilitator and management accounting change agent for management accounting in organisations and be well prepared for the varied and changing roles of the controller function
●    demonstrate an ability to work with theoretical and research based knowledge in the area of management accounting;
●    communicate, negotiate and report financial and non-financial information within a management team by using detailed and coherent reports (both written and spoken) in matters related to management accounting.
●    demonstrate the ability to integrate ethical and sustainable reasoning in the analysis, evaluation and decision making in issues related to management accounting

Focus of instruction
The developments of the management accounting subject, techniques and concepts are presented during lectures.  Requiring reading for the module includes cases, chapters, and articles contained in the assigned textbooks and supplementary materials. Students are expected to take an active part in discussions on the development of the field, literature and article seminars and reporting about case studies. They will be given a number of assignments, leading to continuous assessment. Course work will be done individually and in small groups. Course work must reach an advanced level of knowledge and understanding of the subject.

Module examination modes
Examination is based upon a written comprehensive individual exam and group assignments. A passing grade is required for each part of the module. The course is given and examined in English. Note as well examination modes below for the course as a whole.

Module 3. Advanced Financial Accounting, 7.5 credits
The module develops students’ understanding of the International Financial Reporting Standards (IAS/IFRS) and the ability to handle also more complicated accounting issues. The module also covers ethical issues in accounting and sustainability reporting. Publicly traded companies have to apply the IAS/IFRS-standards in their consolidated reporting in Sweden, other EU member states as well as a large number of other countries. Privately held companies can also apply IAS/IFRS standards voluntarily in their consolidated reporting in Sweden as well as a large number of other countries.

Expected learning outcomes
After completing this module, the student should be able to:
●    apply the International Financial Reporting Standards in intermediate as well as more advanced situations.
●    critique accounting choices from an ethical point of view
●    use accounting principles and theory in order to evaluate and criticize accounting standards
●    analyze the contents of companies’ sustainability reporting.

 Focus of instruction
Learning is supported by lectures, exercises, cases and tuition.

Module examination modes
Examination is based upon a written individual exam and group case-assignments. The cases are discussed in class and participation is obligatory. A passing grade is required for the individual exam as well as for the cases. The course is given and examined in English. Note as well examination modes below for the course as a whole.

Module 4. Advanced Auditing, 7.5 credits
This module aims to give students a solid theoretical and practical foundation in auditing. It covers central topics of auditing, such as, risk and materiality assessment, the planning of auditing, the auditing process and auditors’ reporting. Professional ethics and independence issues are also discussed during the course module. The course module is principally based on the International Standards of Auditing (ISAs).

Expected learning outcomes
After completing this module, the student should be able to:
  • discuss and compare the factors that creates a demand for auditing and affects the value of auditing,
  • analyse audit quality, ethics, and independence from auditors’ and investors’ perspectives
  • identify the steps in the audit plan and evaluate the general types of audit tests/procedures
  • discuss why internal controls are important, how control risks are assessed and ultimately evaluate how the status of internal controls affect the focus of the audit
  • evaluate what mix of audit procedures to be performed and what tests that are suitable for auditing of different financial statement items, such as sales, accounts receivables, inventories, liabilities and property, plant and equipment
  • analyse how audit evidence is evaluated and how findings are reported to outside interested parties
  • assess how the concepts of risk and materiality are interrelated based on the audit risk model
Focus of instruction
Learning is supported by lectures, workshops and seminars, in which students are expected to take an active part. Cases related to the topics will also be used.

Module examination modes
Examination is based upon a written individual exam and group assignments. A passing grade is required for each part of the module. The course is given and examined in English. Note as well examination modes below for the course as a whole.

Expected learning outcomes

See each separate module.

Required Knowledge

90 credits with a minimum of 75 credits in Business Administration. At basic level and Intermediate level a minimum of 60 credits in Management, Marketing, Accounting and finance.  At least 7,5 credits in finance courses and at least 7,5 credits in accounting. Statistics or similar 7.5 credits. At the bachelor level, a minimum 15 credits.

Proficiency in English equivalent to Swedish upper secondary course English B or the equivalent.

Form of instruction

See each separate module.

Examination modes

See each separate module and below.

The following grading system is used:
Pass with distinction (Väl godkänd, VG, 75% or more),
Pass (Godkänd, G, 50% or more)
and Fail (Underkänd U, less than 50%).

Grades on the course are awarded when the student has passed all examinations and compulsory course elements. The course is given and examined in English.
To receive the grade Pass with distinction (VG) in the 30 credits course consisting of four modules of the same size, the student must have achieved Pass with distinction (VG) in at least three out of four modules. In shorter courses for example 7,5 credit courses, 15 credit courses or 22,5 credits courses Pass with distinction (VG) is given when the student has achieved at least 75% of the total weighted points.

A student who does not pass at the time of the written examination will be offered an opportunity to sit a further examination within two months. Beyond that, additional examination opportunities normally arise every academic year, one week prior to the start of the autumn term.
In case of failure on seminar participation or individual and group assignments, compensating assignments must be completed in accordance with instructions given, no later than two weeks after the completion of the module. Mandatory assignments (seminars, written assignments, cases, computer assignments etc.) that have not been handed in within stipulated time must be done the next time the course is offered. If the form of examination does not permit repetition other forms of re-examination may be used.

When a student has failed an examination on two occasions, he or she has a right to have another grading teacher. A written request for an alternative examiner should be handed to the director of studies no later than two weeks before the next examination opportunity.

A student who has passed an examination can not redo the examination to get a higher grade.

If a student fails to present a photo ID at the occasion of a written exam in an exam room will not be allowed to take the exam.

Disciplinary action may be taken against students who uses unauthorized help aids or in some other way tries to mislead on a test or when another type of task is being evaluated. Rules and regulations concerning the production of academic texts and correct referencing will be applicable to all written assignments. (see instructions in the thesis manual, Thesis Writing in Business Administration). Urkund records may be used for control. In addition, Umeå University rules and regulations for education and research applies:  http://www.umu.se/regelverk/utbildning-pa-grund--och-avancerad-niva

Educational activities are designed to facilitate students towards achieving expected learning outcomes and can explain, supplement and provide contrast to the course literature and other relevant course materials.

Other regulations

Academic credit transfers are according to the University credit transfer regulations.

This course can not be included in the degree together with 2fe195, 2fe181

Literature

Valid from: 2017 week 35

Module 1

Penman Stephen H.
Financial statement analysis and security valuation
5th ed. : New York : McGraw-Hill Higher Education : 2012 : 740 s. :
ISBN: 978-0-07-132640-7 (pbk.)
Mandatory
Search the University Library catalogue

Vetenskapliga artiklar om sammanlagt ungefär 40 sidor tillkommer vid momentstart.

Module 2

Management control systems
Anthony Robert N., Govindarajan Vijay, Hartmann Frank G., Kraus Kalle, Nilsson Göran
1. European ed. : Maidenhead, Berkshire : McGraw-Hill Education : cop. 2014 : xx, 640 s. :
ISBN: 9780077133269
Mandatory
Search the University Library catalogue

Research articles and case will be added at the start of the module, approximately 50 pages in total.

Module 3

Christian Dieter
IFRS Essentials
John Wiley & Sons : 2013 : 656 s. :
ISBN: 9781118494714
Mandatory
Search the University Library catalogue

Articles will be added at the start of the module. Articles are approximately 100 pages in total. International Financial Reporting Standards 2017 (in English or Swedish)

Module 4

Eilifsen, A., Messier, W.F jr, Glover, S.M., and Prawitt, D.W.
Auditing & Assurance Services.
Third International Edition. (2014) :
Mandatory
Reading instructions: ISBN 13 978 0 07 714301 5

Articles and case will be added at the start of the module, approximately 100 pages in total.

Course reference literature

Umeå School of Business and Economics
Thesis writing in Business Administration. Thesis manual. Umeå: Umeå University.
USBE Företagsekonomi, (latest edition) :
Reading instructions: Retrieved from: http://www.usbe.umu.se/english/dept/fek/for-our-students/theses/thesis-manual/