This course focuses on adopting and implementing a financially analytic mindset when engaged in organizational decision-making and scenario analysis. The course begins with an overview of the "internal" perspective of the organization, in which you will learn fundamental concepts, including the importance of how cost information is organized for different decision scenarios. You will then learn about scenario analysis, including cost-volume-profit analysis and other fundamental concepts that help facilitate financial organizational decision-making.
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Next, you will learn about planning and budgeting, a key function that allows organizations to identify and allocate resources necessary to achieve organizational goals. You will then learn how to assess actual performance against these budgets using variance analysis.
Finally, you will learn about the organization’s performance measurement, evaluation, and compensation system. Specifically, you will learn about the advantages and disadvantages of common financial performance measures and understand how an organization uses non-financial performance measures within its strategic performance measurement system to complement the financial perspective.
Course 3 of 3 in the Financial Analysis - Skills for Success Specialization.
Syllabus
WEEK 1
Course Introduction and Module 1: Accounting Using an Internal Perspective
In this module, you will become familiar with the course, your instructor, your classmates, and our learning environment. Then, you will be introduced to Managerial Accounting and Costing Concepts. Next, you will explore cost-volume-profit (CVP) analysis. CVP analysis is a tool that managers can use to better understand the answers to "what-if" questions in order to make better decisions for their companies. You will also explore the nature and role of relevant information in common business decisions, two key related concepts, and how to avoid common decision-making "pitfalls."
WEEK 2
Module 2: Planning and Budgeting
At the heart of an organization’s planning and control function is its budget. In this module, you will explore the purpose of budgeting, the role of managers and employees in budgeting, and related implications. You will also develop an organization’s budget, ultimately understanding the iterative nature among the budget’s key components.
WEEK 3
Module 3: Variance Analysis
After establishing goals, setting targets, and the budget, upper management uses variance analysis to compare, assess, and investigate differences between actual and expected performance. In this module, you will learn how upper management uses variance analysis to motivate and monitor managers and employees, how to perform variance analysis on any aspect of the organization, and ultimately understand the power of this important tool for planning and control.
WEEK 4
Module 4: Performance Measurement and Evaluation
Accountants help implement, communicate, and evolve organizational strategy via the information they provide to owners, managers, and employees. Specifically, they help plan, monitor, and control decisions via the performance measurement, evaluation, and compensation system. In this module, you will explore many aspects of this important system, including decentralization, financial and non-financial performance measurement, strategic performance measurement systems, and subjective performance evaluation.
