The general purpose of this course is to develop students’ understanding and capabilities on the subject of business groups as a form of business combination designed to achieve strategic and operating objectives. In particular, at the end of the course, students will get knowledge and understanding of: - The features, purposes, processes and conditions of group creation, as well as the group structure and mechanisms of group governance (governance); - The principles for preparing the consolidated financial statement, i.e. to for representing equity and net income at the group level (reporting); - The logic that guides the assessment of financial performance at the group level, relying on the knowledge of group structures and consolidation accounting previously gained (governance and reporting). At the end of the course, students will be able to: - Interpret the strategic and operating implications of groups’ structure and governance mechanisms; - Apply the methodologies and techniques of consolidation accounting; - Apply the methodologies and techniques for analyzing the financial performance at the group level.
The course program is structured into three parts:
1. Genesis, structure and governance of groups of companies.
1.1. The creation of groups: Purposes and processes – 1.2. Determinants of groups creation – 1.3. Groups classifications – 1.4. Governance structure in groups: The relationship between ownership and direction, and the role of minorities – 1.5. Conflict of interest within groups – 1.6. The transfer price mechanism – 1.7. Firm and group direction.
2. Theory and technique of consolidated financial statement
2.1. Introduction to the consolidated financial statement – 2.2. Integration logic and consolidation methods – 2.3. Regulation: The consolidated financial statement in Italy – 2.4. Scope of consolidation – 2.5. The consolidation process: 2.5.1. Preliminay adjustments – 2.5.2 Genesis and accounting treatment of the consolidation difference – 2.5.3. The adjustment of intragroup transactions – 2.5.4. Non-controlling interests – 2.5.5 Accounting treatment for unconsolidated participations - 2.6 Consolidated financial statement according to the International Financial Reporting Standards (Ias/Ifrs)
3. Analysis and assessment of the group’s performance
3.1. The group informative system – 3.2. Information content of consolidated financial statement and performance analysis at the group level – 3.3. Segment reporting – 3.4. The reconciliation statement – 3.5. Economic equilibrium at the group level – 3.6 Financial equilibrium at the group level: – 3.6.1. Share leverage – 3.6.2 Financial leverage – 3.7. Overall judgement on the group’s performance.
In order to encourage students’ learning ability, the course adopts an integrated approach that combines theoretical lessons, practical applications, discussion of case studies and analysis of a consolidated financial statement. The course includes also some seminars with representatives of groups of companies.
During the lessons some exam simulations will be made available.
During the whole academic year, individual office hour is offered by the Lecturers (please see the Lecturers' web page for updated office hours). The Lecturers are also available on appointment (please send an e-mail).
The content of the textbook, of the lessons and the exercises carried out during the course is consistent with the programme. Both the programme and the studying materials are the same for students who attend and students who do not attend the course. Teaching slides, further readings and accounting standards will be available on the e-learning platform (teaching Dashboard).
|U. Sòstero, F. Cerbioni, C. Saccon||Bilancio consolidato:disciplina nazionale e IFRS (Edizione 2)||McGraw-Hill Education, Milano||2018||9788838695179|
|Zattoni, A.||Corporate governance||Egea||2015|
|LAI A.||Le situazioni di equilibrio economico-finanziario di gruppo (Edizione 2)||Franco Angeli||2003||8846450361|
Students will be assessed differently according to their status as attending or non-attending students. Students who attend the course will be assessed through an intermediate and a final exam: 1. The intermediate exam consists in a group-work analyses of the structure, governance, and performance of a group of companies. The intermediate exam consists in the drafting of a report of around 10-15 pages (word or pdf), which is due towards the end of the course and shall be sent by e-mail, and a 3-slide presentation to be discussed in classroom (around 10 minutes per group). The group-work aims at assessing the capability acquired in performing and discussing a meaningful group analysis, both at a technical and an interpretive level. Furthermore, the capabilities will be assessed, both individually and collectively, in making judgments on the group performance, in communicating with the group members and in written and oral communications. The group-work will provide students with maximum 3 points. 2. The final exam consists in an individual written test on the whole program and aims to verify the theoretical and practical knowledge acquired. Students who do not attend the course will be assessed through the written test indicated at point 2. above and described below.
The written test includes three questions (for all students): one exercise on consolidation accounting and two semi-open questions that might be theoretical and/or practical. The test is successful if the mark is at least equal to 18/30 in each one of the three questions. The exam lasts 1 hour and 30 minutes and will provide students with maximum 30/30 points.
Students who pass the written test might request an oral examination t if they were confident of reaching a higher mark.