Teaching code

4S008086

Academic staff

Cristina Florio, Giovanni Sandrini

Coordinator

Cristina Florio

Credits

9

Language

Italian

Scientific Disciplinary Sector (SSD)

SECS-P/07 - BUSINESS ADMINISTRATION AND ACCOUNTING STUDIES

Period

Secondo semestre (lauree magistrali) dal Feb 20, 2023 al May 19, 2023.

Lessons timetable Moodle Seminars 2

Learning objectives

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.

Prerequisites and basic notions

There are no prerequisites. However, students are invited to have (at least) basic knowledge of the main business transactions, their accounting recognition and their effects on the equity, income and cash flows; the purpose and content of the financial statement. Those who do not have this knowledge are invited to ask the lecturer for information on introductory readings.

Program

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.

Teaching materials
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).

Readings
A. Zattoni, Corporate governance, Egea, Milano, 2015 (cap. 1-2-6 e par. 7.1-7.2-7.3)
U. Sòstero, F. Cerbioni, C. Saccon, Bilancio consolidato: disciplina nazionale e IFRS, 2^ Edizione, McGraw-Hill Education, Milano, 2018 (cap. 1-3-4-7-9 e par. 2.2-2.3-6.3-8.1-8.2-8.3)
A. Lai., Le situazioni di equilibrio economico-finanziario di gruppo, 2^ Edizione, Franco Angeli, Milano, 2003 (cap. 1-3-4-5-6)

Bibliography

Didactic methods

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.

Learning assessment procedures

The exam consists in an individual written test on the whole program and aims to verify the theoretical and practical knowledge acquired. It includes three questions: one exercise on consolidation accounting and two semi-open questions that might be theoretical and/or practical. The exam lasts 1 hour and 30 minutes and evaluated in thirties.
A team-work provides students with maximum 3 points. The analysis of the structure, governance, and performance of a group of companies is required. The team-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.

Students who cannot take part in the team-work will be assessed through the written test only.

Evaluation criteria

The questions are structured in such a way as to verify the level of knowledge of the different parts of the program. Evaluation tends to ascertain this level of knowledge and the ability to apply this knowledge to practical situations.

Criteria for the composition of the final grade

Each question is marked in thirties. The final grade is computed as the average of the marks obtained in the three questions. However, the student must answer at least sufficiently each one of the three questions.
For the team-work, a maximum of 3 points are assigned, which are added to the mark obtained in the written test, provided that the latter is passed.

Exam language

Italiano