General Information
Target Audience
This course will be of interest to students interested in working in, consulting for, investing in, or founding low-carbon energy and related cleantech businesses. It will also be of interest to students with a general interest in following ongoing developments in technology, policy, and news around the global response to climate change.
Course Mission
This course will help you analyze and value businesses using financial statements. We will discuss how
accounting regulations and managerial discretion influence financial statements. You will also learn how
to interpret financial statements, analyze cash flows, and make judgments about earnings quality.
Finally, we will use financial statement analysis prospectively to forecast and value firms using cash flowbased and accounting-based methods.
Course Scope
The course will consist of five modules. The first module (industry and strategic analysis) will illustrate
why the critical first step is to understand industry structure and a company’s strategic choices. The
second module (accounting analysis) will provide a framework to understand and evaluate a firm’s
accounting and disclosure choices, and provide techniques to adjust financial statements to ensure
better comparability. The third module (financial analysis) will present a comprehensive framework for
ratio analysis where a firm’s operations are separated from its financing to better understand the true
drivers of profitability and risk. The fourth module (prospective analysis) will present techniques for
integrated forecasting, and will apply the insights from the earlier modules to generate forecasts for the
firm. These forecasts will be used to value firms using a variety of techniques including multiples and
abnormal earnings-based valuation methods. In the fifth module, the techniques learned in the prior
modules will be applied in a variety of settings including credit analysis and mergers and acquisitions.
Evaluation and Grade Distribution
| Component | Due Date | Weight |
|---|---|---|
| Class Participation | Ongoing | 20% |
| Group Project – Part 1 | July 30, 2022 11:59 pm | 20% |
| Group Project – Part 2 | August 7, 2022 11:59 pm | 20% |
| Final Exam | August 9, 2022 5:00 pm | 15% |
Required Resources
All the course documents (e.g., presentations for class, Excel spreadsheets, links to articles from the
business press, additional readings, etc.) will be available on Quercus. There will be no additional course
packet. There is no required or recommended book for the course. If you wish, you may use any
financial statement analysis and valuation textbook as a supplementary reference.
Notes
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