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Accounting Analytics

Brian J Bushee and Christopher D. Ittner

4.5

Based on 2,995 ratings

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Brian J Bushee and Christopher D. Ittner

Accounting Analytics explores how financial statement data and non-financial metrics can be linked to financial performance. In this course, taught by Wharton’s acclaimed accounting professors, you’ll learn how data is used to assess what drives financial performance and to forecast future financial scenarios. While many accounting and financial organizations deliver data, accounting analytics deploys that data to deliver insight, and this course will explore the many areas in which accounting data provides insight into other business areas including consumer behavior predictions, corporate strategy, risk management, optimization, and more. By the end of this course, you’ll understand how financial data and non-financial data interact to forecast events, optimize operations, and determine strategy. This course has been designed to help you make better business decisions about the emerging roles of accounting analytics, so that you can apply what you’ve learned to make your own business decisions and create strategy using financial data.

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Syllabus

Ratios and Forecasting

The topic for this week is ratio analysis and forecasting. Since ratio analysis involves financial statement numbers, I’ve included two optional videos that review financial statements and sources of financial data, in case you need a review. We will do a ratio analysis of a single company during the module. First, we’ll examine the company's strategy and business model, and then we'll look at the DuPont analysis. Next, we’ll analyze profitability and turnover ratios followed by an analysis of the liquidity ratios for the company. Once we've put together all the ratios, we can use them to forecast future financial statements. (If you’re interested in learning more, I’ve included another optional video, on valuation). By the end of this week, you’ll be able to do a ratio analysis of a company to identify the sources of its competitive advantage (or red flags of potential trouble), and then use that information to forecast its future financial statements.

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Covers ratio analysis, earnings management, big data, and linking non-financial metrics to financial performance, which are core skills for professionals in accounting and finance

Taught by Wharton’s renowned accounting professors, Brian J Bushee and Christopher D. Ittner, who are recognized for their expertise in accounting and financial analytics

Develops accounting analytics skills that are highly relevant to industry, academia, and personal growth

Uses a multi-modal approach with videos, readings, and discussions to enhance the learning experience

Provides foundational knowledge for beginners and strengthens skills for intermediate learners

Requires some background knowledge in accounting and financial concepts

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Reviews summary

Applying accounting data for business insight

According to learners, this course provides a strong theoretical foundation in using accounting data for business analysis. Many found the modules on earnings management and ratio analysis particularly useful and well-explained by the knowledgeable instructors. While the lectures are clear, some students felt the course could benefit from more hands-on practice and real-world application, noting it is best suited for those with some prior accounting or finance background. A few recent reviews suggest the content or examples might be slightly outdated, indicating potential areas for improvement.

Challenging for beginners, better with background.

"Coming from a non-accounting background, I found some of the initial concepts quite challenging and needed extra study."

"Having some prior finance or business knowledge definitely helps make the most of this course material."

"It was manageable, but I needed to review some basic accounting principles beforehand to keep up."

Instructors demonstrate deep expertise.

"The professors are clearly experts in their field and convey complex topics effectively."

"I appreciated the depth of knowledge shared by the instructors throughout the course."

"Their real-world insights added significant value to the material presented."

Strong coverage of key analytics topics.

"The modules on earnings management detection and ratio analysis were incredibly insightful and practical for my job."

"I found the explanation of DuPont analysis and forecasting particularly clear and helpful for strategic thinking."

"Understanding how to spot potential financial statement manipulation is a valuable skill I gained here."

Some data or examples may be dated.

"Some of the company examples used felt a bit old; using newer data would be better for current analysis."

"While the principles are timeless, using more recent case studies would enhance the relevance of the material."

"I noticed a few examples weren't using the most current financial data available for analysis."

More theoretical than applied methods.

"I felt the course was very theoretical and didn't offer enough hands-on practice with real data using relevant software."

"Could use more practical exercises and case studies to solidify the concepts learned in the lectures."

"While the concepts were clear, applying them in real-world scenarios felt challenging after completing the course."

Activities

Be better prepared before your course. Deepen your understanding during and after it. Supplement your coursework and achieve mastery of the topics covered in Accounting Analytics with these activities:

Volunteer as a Financial Literacy Tutor

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Volunteer as a financial literacy tutor to strengthen your understanding of financial concepts by teaching them to others.

Browse courses on Financial Literacy

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Find a local organization that offers financial literacy tutoring.
Sign up to volunteer as a tutor.
Attend a training session to learn how to teach financial literacy.

Organize Course Materials

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Organize your course materials to enhance your ability to review and reference them.

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Gather all of your course materials, including notes, assignments, quizzes, and exams.
Create a system for organizing your materials, such as using a binder, folder, or digital storage system.
Review your materials regularly to reinforce your learning and identify areas where you need additional support.

Review Financial Statement Analysis

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Review basic financial statement analysis to strengthen your knowledge prior to beginning the course.

Browse courses on Financial Statements

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Re-read your past class notes on financial statement analysis.
Review practice problems and solutions from your previous financial accounting course.
Complete a few practice exercises on financial statement analysis.

Five other activities

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Review 'Financial Statement Analysis' by Martin Fridson

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Review a foundational book on financial statement analysis to strengthen your understanding of the topic.

View The Little Book of Picking Top Stocks: How to... on Amazon

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Purchase or borrow a copy of the book.
Read the book thoroughly, taking notes and highlighting important passages.
Complete the practice problems and exercises in the book.

Review Non-Financial Metrics

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Review non-financial metrics to strengthen your understanding of their importance in financial analysis.

Browse courses on Non-Financial Metrics

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Identify the key non-financial metrics commonly used in your industry or field.
Read articles and research papers on the use of non-financial metrics in financial analysis.
Attend a workshop or webinar on non-financial metrics.
Practice using non-financial metrics to analyze company performance.

Practice Ratio Analysis

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Practice ratio analysis to enhance your understanding of financial statement analysis.

Browse courses on Ratio Analysis

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Find a set of financial statements for a publicly traded company.
Calculate the key financial ratios for the company using the financial statements.
Interpret the ratios to assess the company's financial performance.

Explore Data Analytics Tools

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Learn how to use data analytics tools to enhance your financial analysis skills.

Browse courses on Data Analytics Tools

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Identify a few data analytics tools that are commonly used in finance.
Find tutorials or online courses on those tools.
Complete the tutorials or online courses to learn how to use the tools.

Develop a Financial Model

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Create a financial model to apply your forecasting skills and enhance your understanding of financial analysis.

Browse courses on Financial Modeling

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Choose a company or industry to analyze.
Gather financial data and assumptions about the company or industry.
Build a financial model using the data and assumptions.
Use the model to forecast the company's or industry's financial performance.

Career center

Learners who complete Accounting Analytics will develop knowledge and skills that may be useful to these careers:

Financial Analyst

Financial Analysts use sophisticated quantitative techniques to provide insights that inform critical business decisions. This course in Accounting Analytics would help build the accounting-specific knowledge base necessary to excel in the role. The modules on forecasting financial statements and using data to assess financial performance and business strategy are especially relevant.

See salaries and explore the career path for Financial Analyst

Management Consultant

Management Consultants advise companies on how to improve their performance. Accounting Analytics can provide the tools to critically analyze financial data and non-financial metrics as they relate to financial performance, which is key to developing effective strategies for clients.

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Auditor

Auditors examine and evaluate financial records to ensure their accuracy and compliance with regulations. The ability to analyze financial data, identify red flags for earnings manipulation, and predict financial performance are all skills auditors develop.

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Data Scientist

Data Scientists use data to solve business problems and create value. The models and techniques taught in this course can be applied to solve problems in finance, which is a core application of data science.

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Risk Manager

Risk Managers evaluate and mitigate risks that may affect a company's financial performance. This course in Accounting Analytics builds a foundation for understanding how to identify and assess risks, and how to use data to develop strategies for managing them.

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Chief Financial Officer (CFO)

CFOs are responsible for managing the financial health of a company. This course in Accounting Analytics provides the tools and techniques necessary to understand and analyze financial data, forecast financial performance, and make informed decisions.

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Investment Analyst

Investment Analysts evaluate and recommend investments. The ability to analyze financial data, identify trends, and forecast financial performance is crucial for making sound investment decisions.

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Controller

Controllers are responsible for managing the day-to-day financial operations of a company. This course in Accounting Analytics provides a strong foundation in accounting principles and practices, and the tools and techniques to analyze financial data and ensure compliance.

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Financial Planner

Financial Planners help individuals and families manage their finances and plan for the future. The ability to analyze financial data, forecast financial performance, and understand the relationship between non-financial metrics and financial outcomes is essential for success in this role.

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Tax Accountant

Tax Accountants specialize in the preparation and filing of tax returns. This course in Accounting Analytics may be useful in helping to understand the financial implications of tax laws and regulations.

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Forensic Accountant

Forensic Accountants investigate financial fraud and other financial crimes. This course in Accounting Analytics may be useful in helping to develop the skills and knowledge necessary to analyze financial data and identify red flags.

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Budget Analyst

Budget Analysts develop and manage budgets for organizations. The ability to analyze financial data, forecast financial performance, and allocate resources effectively is essential for success in this role.

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Credit Analyst

Credit Analysts assess the creditworthiness of individuals and businesses. The ability to analyze financial data and forecast financial performance is crucial for making sound credit decisions.

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Business Analyst

Business Analysts identify and solve business problems. The ability to analyze financial data and understand how it relates to business strategy and operations is important for success in this role.

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Actuary

Actuaries use mathematical and statistical techniques to assess risk and uncertainty. The ability to analyze financial data and understand the financial implications of risk is essential for success in this role.

See salaries and explore the career path for Actuary

Reading list

We've selected 17 books that we think will supplement your learning. Use these to develop background knowledge, enrich your coursework, and gain a deeper understanding of the topics covered in Accounting Analytics.

Earnings Information Conveyed by Dividend...

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Specifically covers earnings management, which topic covered in this course, and it adds depth to the course material.

Earnings information conveyed by dividend...

Paperback

Financial Statement Analysis and Securit

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Provides background information on financial statement analysis, a topic that is covered in this course. It is commonly used as a textbook in academic programs.

Financial Statement Analysis and Securit

Paperback

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Financial Statement Analysis and Securit

Kindle Edition

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Financial Statement Analysis Workbook

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Provides a comprehensive overview of financial statement analysis, including techniques for evaluating a company's financial health, profitability, and risk. It valuable resource for anyone who wants to learn more about the accounting analytics process.

Financial Statement Analysis Workbook: A...

Paperback

Financial Statement Analysis Workbook: Step-by-Step...

Paperback

Financial Statement Analysis Workbook: A...

Kindle Edition