Acc.Information and Security Valuation (ACCT90008)

Graduate courseworkPoints: 12.5Not available in 2021

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Overview

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This subject examines the use of financial statements for the fundamental valuation of listed and non-listed entities. Fundamental analysis will be examined in detail and applied to valuation projects involving local and multinational companies. This subject is built around the use of residual earnings as a means of determining the intrinsic value of an entity using only accounting data. It explores the relation between the residual income valuation model, discounted cash flow valuation methods and dividend discount model. It also refers to EVA as a parallel valuation methodology. The subject will also consider forecasting firms' future performance and how it determines the firm’s price/earnings and market to book ratios.

 

Intended learning outcomes

On successful completion of this subject, students should be able to:



  • Describe how 'intrinsic values' are calculated;
  • Identify the relevant firm attributes that determine value;
  • Explain the role of financial statements in determining intrinsic values;
  • Analyse whether some aspects of the financial statements are more important than others and explain the role of 'bottom line' earnings (net income) and book value;
  • Analyse financial statements in order to extract the relevant information;
  • Describe how traditional ratio analysis aids valuation;
  • Evaluate the relevance of cash-flow information and of the accruals in accounting;
  • Explain how accounting methods are applied to financial statements;
  • Explain what determines a firm's P/E ratio and a firm's market-to-book (P/B) ratio;
  • Describe how the P/E and P/B ratios are articulated;
  • Explain how analysis differs across countries and how P/E ratios can consequently be compared across countries;
  • Describe how risk is evaluated, particularly in relation to equity and debt;
  • Identify what EVA is and explain how it is used in performance evaluation.

Generic skills

On successful completion of this subject, students should have improved the following generic skills:

  • Develop an argument logically and coherently;
  • Synthesis of information;
  • Application of current technologies to practice;
  • Accessing data and other information from various sources;
  • Using computer programs, particularly in relation to the processing of data;
  • Problem solving;
  • Statistical reasoning;
  • Critical thinking;
  • Oral and written communication.

Last updated: 3 November 2022

Eligibility and requirements

Prerequisites

Students must meet one of the following prerequisite options:

Option 1

Admission into the MC-MGMTACT Master of Management (Accounting)

All of

Code Name Teaching period Credit Points
ACCT90012 Corporate Reporting
Semester 1 (Dual-Delivery - Parkville)
Semester 2 (Dual-Delivery - Parkville)
 12.5
FNCE90060 Financial Management
Semester 1 (Online)
Semester 2 (Dual-Delivery - Parkville)
 12.5

or equivalent.

Option 2

Admission into the MC-MGMTAFN Master of Management (Accounting and Finance)

Code Name Teaching period Credit Points
ACCT90012 Corporate Reporting
Semester 1 (Dual-Delivery - Parkville)
Semester 2 (Dual-Delivery - Parkville)
 12.5

or equivalent.

Corequisites

None

Non-allowed subjects

None

Inherent requirements (core participation requirements)

The University of Melbourne is committed to providing students with reasonable adjustments to assessment and participation under the Disability Standards for Education (2005), and the Assessment and Results Policy (MPF1326). Students are expected to meet the core participation requirements for their course. These can be viewed under Entry and Participation Requirements for the course outlines in the Handbook.

Further details on how to seek academic adjustments can be found on the Student Equity and Disability Support website: http://services.unimelb.edu.au/student-equity/home

Last updated: 3 November 2022

Assessment

DescriptionTimingPercentage

Mid-semester test

  • 1.5 hours
Mid semester30%

Group project (normally in groups of 4-5 students)

  • 3000 words
Late in the teaching period20%

End-of-semester examination

  • 3 hours
Hurdle requirement: Successful completion of this subject requires a pass (50%) in the final exam.		During the examination period50%

Last updated: 3 November 2022

Dates & times

Not available in 2021

Time commitment details

Estimated total time commitment of 170 hours per semester

Last updated: 3 November 2022

Further information

  • Texts

    Prescribed texts

    Recommended texts and other resources

     

     

  • Subject notes

    Students who have completed ACCT30006 Business and Financial Analysis should take an elective in place of ACCT90008 Acc.Information and Security Valuation.

     

  • Available through the Community Access Program

    About the Community Access Program (CAP)

    This subject is available through the Community Access Program (also called Single Subject Studies) which allows you to enrol in single subjects offered by the University of Melbourne, without the commitment required to complete a whole degree.

    Please note Single Subject Studies via Community Access Program is not available to student visa holders or applicants

    Entry requirements including prerequisites may apply. Please refer to the CAP applications page for further information.

  • Available to Study Abroad and/or Study Exchange Students

    This subject is available to students studying at the University from eligible overseas institutions on exchange and study abroad. Students are required to satisfy any listed requirements, such as pre- and co-requisites, for enrolment in the subject.

Last updated: 3 November 2022