Schweser Notes CFA Level I Book 2 Financial Statement Analysis

• Year: 2022
• Tongue: English
• Leaves: 268
• Category: Library

✦ Table of Contents

Book 2: Financial Statement Analysis
Learning Outcome Statements (LOS)
Reading 16 Introduction to Financial Statement Analysis
Exam Focus
Module 16.1: Financial Statement Roles
Module 16.2: Footnotes, Audit, and Analysis
Key Concepts
LOS 16.a
LOS 16.b
LOS 16.c
LOS 16.d
LOS 16.e
LOS 16.f
Answer Key for Module Quizzes
Reading 17 Financial Reporting Standards
Exam Focus
Module 17.1: Standards Overview
Module 17.2: Financial Reporting Framework
Qualitative Characteristics
Required Reporting Elements
Constraints and Assumptions
Key Concepts
LOS 17.a
LOS 17.b
LOS 17.c
LOS 17.d
LOS 17.e
Answer Key for Module Quizzes
Reading 18 Understanding Income Statements
Exam Focus
Module 18.1: Income Statement Overview
Presentation Formats
Module 18.2: Revenue Recognition
Module 18.3: Expense Recognition
Inventory Expense Recognition
Depreciation Expense Recognition
Amortization Expense Recognition
Bad Debt Expense and Warranty Expense Recognition
Implications for Financial Analysis
Non-Recurring Items
Changes in Accounting Policies and Estimates
Module 18.4: EPS and Dilutive Securities
Basic EPS
Effect of Stock Dividends and Stock Splits
Diluted EPS
Module 18.5: Common-Size Income Statements
U.S. GAAP
IFRS
Key Concepts
LOS 18.a
LOS 18.b
LOS 18.c
LOS 18.d
LOS 18.e
LOS 18.f
LOS 18.g
LOS 18.h
LOS 18.i
LOS 18.j
LOS 18.k
LOS 18.l
Answer Key for Module Quizzes
Reading 19 Understanding Balance Sheets
Exam Focus
Module 19.1: Balance Sheet Introduction
Module 19.2: Assets and Liabilities
Module 19.3: Current Assets and Liabilities
Current Assets
Current Liabilities
Module 19.4: Noncurrent Assets and Liabilities
Module 19.5: Intangible Assets
Module 19.6: Marketable Securities
IFRS Treatment of Marketable Securities
Non-Current Liabilities
Module 19.7: Shareholders’ Equity and Ratios
Key Concepts
LOS 19.a
LOS 19.b
LOS 19.c
LOS 19.d
LOS 19.e
LOS 19.f
LOS 19.g
LOS 19.h
Answer Key for Module Quizzes
Reading 20 Understanding Cash Flow Statements
Exam Focus
Module 20.1: Cash Flow Introduction
Direct Method
Indirect Method
Arguments in Favor of Each Method
Disclosure Requirements
Module 20.2: The Direct and Indirect Methods
Direct Method
Indirect Method
Module 20.3: Converting Indirect to Direct
Major Sources and Uses of Cash
Operating Cash Flow
Investing Cash Flow
Financing Cash Flow
Common-Size Cash Flow Statement
Module 20.4: Free Cash Flow and Ratios
Free Cash Flow to the Firm
Free Cash Flow to Equity
Other Cash Flow Ratios
Performance Ratios
Coverage Ratios
Key Concepts
LOS 20.a
LOS 20.b
LOS 20.c
LOS 20.d
LOS 20.e
LOS 20.f
LOS 20.g
LOS 20.h
LOS 20.i
Answer Key for Module Quizzes
Reading 21 Financial Analysis Techniques
Exam Focus
Module 21.1: Introduction to Financial Ratios
Ratio Analysis
Common-Size Analysis
Graphical Analysis
Regression Analysis
Module 21.2: Financial Ratios, Part 1
Activity Ratios
Liquidity Ratios
Module 21.3: Financial Ratios, Part 2
Solvency Ratios
Profitability Ratios
Module 21.4: DuPont Analysis
Module 21.5: More Financial Ratios
Dividends
Business Risk
Credit Analysis
Key Concepts
LOS 21.a
LOS 21.b
LOS 21.c
LOS 21.d
LOS 21.e
LOS 21.f
LOS 21.g
Answer Key for Module Quizzes
Reading 22 Inventories
Exam Focus
Module 22.1: Cost Flow Methods
Module 22.2: Inventory Systems
Module 22.3: Converting LIFO to FIFO
Effects on Ratios
LIFO Liquidation
Module 22.4: Inventory Valuation
Inventory Changes
Module 22.5: Inventory Analysis
Analysis of Viper’s Ratios Relative to a Group of Industry Peers
Key Concepts
LOS 22.a
LOS 22.b
LOS 22.c
LOS 22.d
LOS 22.e
LOS 22.f
LOS 22.g
LOS 22.h
LOS 22.i
LOS 22.j
LOS 22.k
LOS 22.l
Answer Key for Module Quizzes
Reading 23 Long-Lived Assets
Exam Focus
Module 23.1: Capitalization vs. Expensing
Capitalized Interest
Intangible Assets Created Internally
Purchased Intangible Assets
Intangible Assets Obtained in a Business Combination
Net Income
Shareholders’ Equity
Cash Flow From Operations
Financial Ratios
Module 23.2: Depreciation
Depreciation Methods
Component Depreciation
Useful Lives and Salvage Values
Module 23.3: Impairment and Revaluation
First Revaluation Date
Subsequent Revaluation Dates
Impairments Under IFRS
Impairments Under U.S. GAAP
Intangible Assets With Indefinite Lives
Long-Lived Assets Held for Sale
Analysis of Impairments
Revaluation
Derecognition of Assets
Module 23.4: Fixed Asset Disclosures
IFRS Disclosures
U.S. GAAP Disclosures
Average Age
Total Useful Life
Remaining Useful Life
Key Concepts
LOS 23.a
LOS 23.b
LOS 23.c
LOS 23.d
LOS 23.e
LOS 23.f
LOS 23.g
LOS 23.h
LOS 23.i
LOS 23.j
LOS 23.k
LOS 23.l
LOS 23.m
LOS 23.n
Answer Key for Module Quizzes
Reading 24 Income Taxes
Exam Focus
Module 24.1: Tax Terms
Tax Return Terminology
Financial Reporting Terminology
Module 24.2: Deferred Tax Liabilities and Assets
Deferred Tax Liabilities
Deferred Tax Assets
Treatment for Analytical Purposes
Tax Base of Assets
Tax Base of Liabilities
Module 24.3: Change in Tax Rates
Module 24.4: Permanent Differences
Analyzing the Effective Tax Rate Reconciliation
Key Concepts
LOS 24.a
LOS 24.b
LOS 24.c
LOS 24.d
LOS 24.e
LOS 24.f
LOS 24.g
LOS 24.h
LOS 24.i
LOS 24.j
Answer Key for Module Quizzes
Reading 25 Non-Current (Long-Term) Liabilities
Exam Focus
Module 25.1: Bond Issuance
Bond Terminology
Bonds Issued at Par
Bonds Issued at a Discount or Premium
Balance Sheet Measurement
Module 25.2: Discount and Premium Bonds
Module 25.3: Issuance Cost, Derecognition, and Disclosures
Issuance Costs
Fair Value Reporting Option
Summary of Financial Statement Effects of Issuing a Bond
Module 25.4: Lease and Pension Accounting
Leverage Ratios
Coverage Ratios
Key Concepts
LOS 25.a
LOS 25.b
LOS 25.c
LOS 25.d
LOS 25.e
LOS 25.f
LOS 25.g
LOS 25.h
LOS 25.i
LOS 25.j
Answer Key for Module Quizzes
Reading 26 Financial Reporting Quality
Exam Focus
Module 26.1: Reporting Quality
Module 26.2: Accounting Choices and Estimates
Revenue Recognition
Estimates of Credit Losses
Valuation Allowance
Depreciation Methods and Estimates
Amortization and Impairment
Inventory Method
Related-Party Transactions
Capitalization
Other Cash Flow Effects
Module 26.3: Warning Signs
Revenue Recognition
Inventories
Capitalization Policies
Relationship of Revenue and Cash Flow
Other Warning Signs
Key Concepts
LOS 26.a
LOS 26.b
LOS 26.c
LOS 26.d
LOS 26.e
LOS 26.f
LOS 26.g
LOS 26.h
LOS 26.i
Answer Key for Module Quizzes
Reading 27 Applications of Financial Statement Analysis
Exam Focus
Module 27.1: Forecasting
Module 27.2: Credit and Equity Analysis
Investments in Securities
Inventory Accounting Differences
Differences in Depreciation Methods and Estimates
Goodwill
Key Concepts
LOS 27.a
LOS 27.b
LOS 27.c
LOS 27.d
LOS 27.e
Answer Key for Module Quizzes
Topic Quiz: Financial Statement Analysis
FORMULAS
INDEX