Cases in Financial Reporting

This book is a collection of financial accounting cases designed to help you become a user of financial reports. Learning accounting is very much like learning a new language. The best way to learn any language is to immerse oneself in the language and to converse with many people. By reading and using many different companies’ financial statements, you will speed-up your acquisition of accounting concepts and skills. By observing the nuances of financial reporting, you will quickly learn to speak “accounting,” the language of business.
These materials bridge a void in introductory financial statement materials at both the undergraduate and the graduate level. Typically, students are required to read a textbook chapter and do some exercises to ensure concept comprehension. Assigned end of chapter material, however, is often not sufficiently challenging to students with stronger analytical abilities. Questions often focus on financial statement preparation rather than, as appropriate for many students, financial statement use. At the other extreme, unstructured discussion cases can leave students with a weak grasp of the mechanics and subtleties of financial accounting. The cases here fill the void.
Each case deals with a specific financial accounting topic within the context of one (or more) corporation’s financial statements. Each case contains financial statement information (a balance sheet, income statement, statement of cash flows, and footnotes) and a set of directed questions pertaining to one or two specific financial accounting issues. You will use the financial statement information to infer and interpret the economic events underlying the numbers. Some cases are accompanied by a related article taken from the business press. In those instances, information from the article is incorporated into the questions in the case. Some cases involve two or three companies within an industry and the case questions focus on intercompany comparisons of financial information. Some cases include industry-level information that you will use to assess the performance or position of the case company. Numerous cases are based on international companies.