The balance sheet: the statement of financial position

• A structured representation of the entity’s financial position;

• Assets, liabilities & equity: concepts, conventions & paradoxes;

• The influence of the financial framework on the balance sheet;

• The balance sheet as a representation of the past: what to expect in terms of predictive value?

• Individual balance sheet vs. consolidated balance sheet: the book value(s) of the entity;

• Accounting for value: the paradoxes & limitations of accounting;

• Illustrative examples.

The profit & loss account: the statement of performance

• A structured representation of the entity’s performance;

• Income & expenses, gains & losses, cash items & non-cash items: concepts, conventions & paradoxes;

• The influence of the financial framework on the profit & loss account;

• The profit & loss account as a representation of the past performance: predictive value?

• Profitability & cash generation: the relationship between profit & cash;

• Illustrative examples.

The cash-flow statement: generation & use of cash

• A structured representation of the entity’s cash inflows & outflows;

• The operating, financing & investing cycles;

• The value relevance of the cash flow statement;

• Does loss-making imply liquidity issues?

• Illustrative examples.