BUD2 Financial Accounting – the Language of Business

• Topics

  Accounting involves collecting, analyzing, and communicating financial information. It is often referred to as the " Language of Business ". This language is built on specific frameworks, rules, and formats, which students must understand to effectively interpret, analyze, and use financial data. BUD2 Financial Accounting provides the students with the foundational skills needed to read and interpret financial statements and use accounting data to support informed business decisions. It also equips students with tools to identify and avoid common pitfalls in decision-making.

  This introductory financial accounting course focuses on understanding the fundamentals of financial accounting and applying them in real-world analytical contexts. The course uses International Financial Reporting Standards (IFRS) as the primary accounting framework, which is the mandatory standard for listed companies in the EU, Norway, and over 100 countries worldwide. The course is taught during the third semester, where the overarching theme is management and technological change, emphasizing how to run a business effectively and make sound investment and operational decisions.

  After completing the course, the students will have a solid foundation in financial accounting principles, be able to analyze and interpret financial statements, and apply financial data for decision-making in a global business environment.

  Key topics covered in this course:

  • Introduction to financial accounting: understanding the basic concepts and relationships in financial accounting including the purpose and role of accounting in business; understanding how the consequences of business decisions are reflected in the financial statements.
  • Accounting frameworks and regulations: discussing regulatory frameworks and the role of accounting standards, with an introduction to IFRS; providing an overview of the annual report and sustainability reporting.
  • The three major financial statements: learning the nature, purpose, and content of the three major financial statements - Balance Sheet (Statement of Financial Position), Income Statement (Statement of Profit and Loss), and Statement of Cash Flows ; understanding how these statements are interconnected and their importance in financial analysis.
  • Financial statement analysis: analyzing and interpreting financial statement data to assess a company's financial health through profitability, solvency, and liquidity analysis; comparing financial performance across companies.

• Learning outcome

  Knowledge

  After completing the course, the students will:

  • understand the fundamental concepts, principles, and objectives of financial accounting
  • have a basic knowledge of the International Financial Reporting Standards (IFRS), their significance, and role in global accounting practices
  • understand the purpose and content of the three major financial statements: the Balance Sheet, Income Statement, and Statement of Cash Flows, as well as the relationship between them
  • have knowledge of the key components of the annual report and sustainability reporting
  • have knowledge of how common business transactions are reflected in the financial statements
  • understand how judgment and uncertainty affect financial statements

  Skills

  After completing the course, the students will be able to:

  • apply basic accounting principles to account for common business transactions in financial statements
  • recognize how accounting frameworks and regulations impact the preparation and presentation of financial statements
  • prepare a basic Balance Sheet, Income Statement, and a Statement of Cash Flows
  • analyze and interpret financial statements to evaluate a company's financial health, including its profitability, liquidity, and solvency
  • perform basic benchmarking to compare the financial health and performance of different companies

  General Competencies

  After completing the course, the students will:

  • acquire a foundational understanding of financial accounting and how financial statements and financial information in general can improve the quality of decision making
  • develop the ability to think critically and systematically about financial information and its implications for business decisions
  • be able to communicate accounting information in a written form

• Teaching

  • Lectures
  • Workshops (solving problems and practical cases in groups)
  • Group project (students will be pre-assigned to groups of 2 - 4 by the instructors)
  • Weekly Q&A sessions

• Recommended prerequisites

  None

• Required prerequisites

  None

• Compulsory Activity

  Group project: Students will be pre-assigned to groups of 2-4 students by the instructor. The task will be to perform a basic financial statement analysis of a company and submit a written report.The group work will be assessed with "Approved"/"Not Approved". The mandatory activity should be successfully completed (ie, receiving "Approved" grade) for the students to receive a course approval.

• Assessment

  4 hours written digital school exam. The students will have access to Excel.

  The exam must be answered in English.

• Grading Scale

  A-F

• Literature

  Atrill, P., & McLaney, E. (2025). Financial accounting for decision makers (11th ed.). Pearson. ISBN: 9781292739120

  Also available as an eBook with 12-month access: ISBN-13: 9781292471105.

• Permitted Support Material

  Calculator

  One bilingual dictionary (Category I).

  All in accordance with Supplementary provisions to the Regulations for Full-time Study Programs at the Norwegian School of Economics Ch.4 Permitted support material https://www.nhh.no/en/for-students/regulations/https://www.nhh.no/en/for-students/regulations/ and https://www.nhh.no/en/for-students/examinations/examination-support-materials/https://www.nhh.no/en/for-students/examinations/examination-support-materials/

• Retake

  Retake is offered early in the non-teaching semester for students who were registered for the exam at the time of the assessment in the teaching semester, and did not achieve a passing grade. Other students may retake the exam the next time the course is offered.

  For detailed information regarding the retake policy, please visit our website: https://www.nhh.no/en/for-students/examinations/retake-of-exams/https://www.nhh.no/en/for-students/examinations/retake-of-exams/ (copy url).