Course Description

Financial ratio analysis is an effective tool for CPAs to evaluate and analyze financial trends to highlight operational efficiencies and inefficiencies. For the CPA in the attest function, financial ratios can be an important tool for audit planning to identify operational issues as well as any potential going concern questions that should be addressed. Through the use of example financial statements, this course demonstrates the practical uses of:

·         Common sized financial statements

·         Commonly used financial ratios

·         The DuPont Model for evaluating return on equity

·         Ratios to forecast working capital

·         Cash flow ratios to identify potential liquidity issues

 Learning Objectives

Upon completion of this course, you should be able to:

·         Recognize the elements of common sized financial statements

·         Compute commonly used financial ratios

·         Differentiate the implications of each ratio to the company being measured

·         Recognize the elements of the DuPont model

·         Recognize the use of ratios to forecast certain working capital account balances

·         Compute commonly used cash flow ratios

Prerequisites: None

Level: Overview

NASBA Category: Accounting

Recommended CPE:  4 Hours

Revision Date:  1/2021

Additional Contents : Complete, no additional material needed
Advance Preparation : None
Intended Participants : Any CPA looking to maintain or enhance their professional competence
Course Declaration : Participants must complete the final examination within one year of purchase. A minimum passing grade of 70% or better is required to receive CPE
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