Investment Evaluation and Accounting Treatment
This course can benefit accountants, as well as business managers, that want to understand how financial ratios and other forms of analyses can be used to evaluate a business. This course also covers the investment classifications and investment accounting used by companies to record investments within their financial statements.

Below is a listing of the items covered within the course.
  • The basic tools to evaluate company financial statements including
    • Vertical Analysis;
    • Horizontal Analysis;
    • Ratio Analysis
      • Liquidity and Efficiency Analysis
      • Solvency
      • Profitability
      • Market Prospects
      • DuPont Analysis
  • Accounting for company investments depending on the type of investment, the holding period of the investment, the company’s intent, and the company’s percentage of investment in the investee’s equity.
  • Accounting for debt investments including:
    • Bond valuation;
    • Recording of bond acquisitions and interest revenue;
  • Accounting classifications for debt investment including accounting for:
    • Held-to-maturity debt
    • Trading debt
    • Available-for-sale debt
  • Sales and impairments of debt instruments;
  • Financial statements’ presentation of investments in debt instruments including comprehensive income, international reporting standards, and the fair value option.
  • Accounting for equity investments including illustration of investment acquisition, receipt of dividends, recording of fair value changes, and investment selling.
  • Discussion of the treatment of equity investments under the following accounting approaches:
    • Fair Value Through Net Income Approach
    • Equity Method Approach
    • Consolidation Method


Course Publication Date: January 17, 2022

This course is available with NO ADDITIONAL FEE if you have an active self study membership or all access membership or can be purchased for $40.00!

Author:CPE Academy LLC
Course No:FIN-INVEST-1521
Recommended CPE:4.00
Delivery Method:QAS Self Study
Level of Knowledge:Intermediate
Prerequisites:None
Advanced Preparation:None
Recommended Field of Study:Finance
  
Learning Objectives
  • Describe the various company evaluation techniques including vertical, horizontal, and ratio analysis that can be used.
  • Demonstrate an understanding of various company ratios for liquidity and efficiency, solvency, profitability, and market prospects.
  • Compute various company ratios for liquidity and efficiency, solvency, profitability, and market prospects.
  • Compute the DuPont Analysis given the appropriate company information.
  • Demonstrate an understanding of basic bond valuation including recording a bond acquisition and interest revenue.
  • Describe the various accounting classifications including held-to-maturity, trading, and available-for-sale for debt securities.
  • Demonstrate an understanding of sales and impairments of debt investments.
  • Demonstrate an understanding of the financial statements’ presentations, international reporting standards, and the fair value option of debt investments.
  • Discuss what is meant by significant influence and how it effects the accounting classification of equity investments.
  • Explain the recording of the purchase of equity investments.
  • Demonstrate an understanding of how dividends, changes in fair value, impairment, and the sale of an equity investment are recorded under the fair value through the net income approach.
  • Explain the financial statement presentation under the fair value through the net income approach.
  • Demonstrate an understanding of the recording of investment revenue, receipt of dividends, and additional adjustments under the equity method approach.
  • Explain the financial statement presentation under the equity method approach.
  • Discuss the fair value option under the equity method approach.
  • Demonstrate an understanding of the recording of investment revenue, receipt of dividends, and recording of additional adjustment under the equity method approach.
  • Demonstrate an understanding of the consolidation method including the concept of noncontrolling interest and the consolidated financial statements.
  • Explain where various investment types are presented within the financial statements.

CPE Depot Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org.

Sponsor Number: 109423

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