Finance

1. SYLLABUS
RAFIC HARIRI UNIVERSITY (RHU)
College of Business Administration (CBA)
Department of Financial Studies
Course Syllabus
BFIN 350 – Credit & Financial Statement Analysis
COURSE INFORMATION
Course Code & Title: BFIN 350 Credit & Financial Statement Analysis
Credits: 3 credits
Prerequisite: BFIN 300
Classroom: H 203
Schedule: MWF: 10:00 – 10:50am
Term: Spring 2018
INSTRUCTOR INFORMATION
Instructor: Ragheed Moghrabi
Office: Bldg G, Room G-101O
Office Hours: WF: 3:00 - 4:00 Else by appointment
Instructor’s Email: moghrabiri@rhu.edu.lb
Textbook & Material: Fraser, Lyn M./ Ormiston, Aileen. Understanding Financial
Statements 9th Edition 2010 (Pearson). (Main textbook,
required)
Koch, Timothy W,/ MacDonald, S. Scott. Bank Management
8th Edition 2015 (Cengage Learning). (Main textbook,
required)
Saunders, Anthony; Allen, Linda Credit risk management in
and out of the financial crisis : New approaches to value at risk
and other paradigms / 3rd Edition. 2010 (Wiley) (Optional
textbook)
COURSE GRADING AND EXAMS
Grade Distribution
6 Quizzes 5 % each (dates indicative in schedule)
Analytical Report 1 10%
Analytical Report 2 10%
Analytical Report 3 10%
Analytical Report 4 10%
Final Exam 20%
Attendance, Participation 10%
Important Dates
Analytical Report 1 Wed Jan 31, 2018
Analytical Report 2 Wed Feb 28, 2018
Analytical Report 3 Wed March 28, 2018
Analytical Report 4 Wed Apr 25, 2018
Final Exam Fri May 4, 2018 100 minutes

2. CBA MISSION STATEMENT
The College of Business Administration aspires to transform the lives of students through
graduate and undergraduate business education, contribute to the advancement of knowledge
through applied research, and make a positive impact on society’s pursuit of development and
prosperity.
It aims to foster an educational culture and environment of innovation and collaboration
which enables the development of leaders and professionals, capable and willing to become
agents of principled, ethical and socially responsible human progress.
The College undertakes its mission in the context of a higher education philosophy that
emphasizes proficient technical know-how in a specialization area, reinforced by core
knowledge of main business functional areas, and grounded in the general fundamentals of
liberal arts education.
COURSE DESCRIPTION
Evaluation of financial fitness and performance is a core activity for credit officers, loan
officers and financial managers. That is why this course is designed to equip students with the
necessary knowledge and tools to perform sound financial analysis using public and non-
public statements and reports. Main areas of analysis include liquidity, profitability, solvency,
and leverage and market performance. Prerequisite: BFIN 300.
COURSE OBJECTIVE
Business firms extend credit, banks extend loans. The focus of this course is credit analysis
and lending. It provides an overview of lending principles, covers analytical aspects such as
the financial analysis of a firm to determine credit worthiness, provides an overview of policy
and legal issues, and looks at special types of credits like consumer loans, real estate loans,
corporate loans and international loans. It also covers related topics such as securitization,
portfolio management and problem loan management.
OUTCOMES
Upon successful completion of the course and among other things, a student should be
able to:
1. Outline the basic aspects of lending and the principles of good lending
2. Explain the rationale for credit scoring models and discuss their development and
application
3. Define and discuss credit risk and explain its measurement and control in relation
to individuals, businesses and portfolios
4. Evaluate and discuss the various issues/loan types/techniques/statistics pertaining
to consumer, real estate, corporate, small business and international lending
5. Identify an overview of problem loan management: causal factors, remedial
actions, statistics etc
6. Apply the tools of credit analysis and lending management to solve problems
faced by banks in assessing loans and managing loan portfolios

3. OUTCOMES / ASSESSMENT ALIGNMENT MATRIX
Number Outcome Assessment
1 Outline the basics on lenders and the principles of
the lending business
Quiz 1
Final Exam
2 Explain the rationale for credit scoring models and
discuss their development and application
Quiz 2
Assignment 1
Final Exam
3 Define and discuss credit risk and explain its
measurement and control in relation to individuals,
businesses and portfolios
Quiz 3
Assignment 2
Final Exam
4 Evaluate and discuss the various issues/loan
types/techniques/statistics pertaining to consumer,
real estate, corporate, small business and
international lending
Quiz 4
Assignment 2
Final Exam
5 Identify an overview of problem loan management:
causal factors, remedial actions, statistics etc
Quiz 5
Assignment 3
Final Exam
6 Apply the tools of credit analysis and lending
management to solve problems faced by banks in
assessing loans and managing loan portfolios
Quiz 6
Assignment 4
Final Exam
Assessment
Tools
Learning Outcomes
(Competencies)
6
Quizzes
5%
Each
Paper 1
10%
Paper 2
10%
Paper 3
10%
Paper 4
10%
Final
Exam
30%
LO1: Outline the basics on lenders and
the principles of the lending business XQuiz
1
X
LO2: Explain the rationale for credit
scoring models and discuss their
development and application
XQuiz
2
X X
LO3: Define and discuss credit risk and
explain its measurement and control in
relation to individuals, businesses and
portfolios
XQuiz
3
X X
LO4: Evaluate and discuss the various
issues/loan types/techniques/statistics
pertaining to consumer, real estate,
corporate, small business and
international lending
XQuiz
4
X X
LO5: Identify an overview of problem
loan management: causal factors,
remedial actions, statistics etc
XQuiz
5
X X
LO6: Apply the tools of credit analysis
and lending management to solve
problems faced by banks in assessing
loans and managing loan portfolios
XQuiz
6
X X

4. CPC DISTRIBUTION TABLE: TOTAL = 77
Area Component Hours
Functional Areas a. Marketing
b. Business Finance 10
c. Accounting 15
d. Management, including Production and Operations
Management, Organizational Behavior, and Human
Resources Management
5
The Business e. Legal Environment of Business 5
Environment f. Economics 5
g. Business Ethics 2
h. Global Dimensions of Business 10
Technical Skills i. Information Systems
j. Quantitative Techniques/Statistics 10
Integrative Areas k. Business Policies, or 5
l. A comprehensive or integrating experience that enables a
student to demonstrate the capacity to synthesize and apply
knowledge and skills from an organizational perspective.
10
TEACHING METHODOLOGY
- Formal and informal lecturing
- Demonstrational problem solving, where applicable
- Class discussions
- Paper assignments covering Chapter topics
- Instructional technologies (PowerPoint, documentaries, videos etc.) will be leveraged
as needed to reinforce learning
- In-class guest speakers as the opportunity arises.
ASSIGNMENTS
 Students are expected to complete 4 assignments throughout the semester.
 The assignments may involve following a company and how the credit/financial
statement analysis is developed with respect to it.
 Students will be given about a month to complete and turn in an assignment. Late
assignments will not be accepted
 All assignments are required to be typed and basic language error free. Graphs or
calculations may be handwritten.
 Detailed assignment instructions will be posted on Moodle in due time.

5. COURSE ADMINISTRATION
 Attendance is mandatory, absences may affect grades.
 Participation in class discussions is strongly encouraged and taken into consideration
in grading.
 Students are fully responsible for any materials presented in class or assigned by the
instructor regardless of attendance or absence
 Absences, whether justified or not, do not excuse students from responsibility for
assignments, quizzes, exams or any other class requirements
 Students may be dropped from the class upon missing more than (15 %) of class
sessions.
 Cell phones must be turned off during classes and put away. They are not allowed as
calculators.
 No assignments will be accepted or graded after the announced due date.
 No make-ups will be offered unless a solid and legitimate excuse is provided.
ACADEMIC INTEGRITY
Students are expected to perform and behave in accordance with ethical standards typical of
institutions of higher education, as prescribed in the university policies and procedures. In
particular, acts of plagiarism, cheating, claiming someone else’s work as our own, copying
and pasting and other similar behaviors are forbidden and may subject students to the
appropriate disciplinary measures as prescribed by university and faculty policies and
procedures.
DETAILED MATERIAL PLANNING
Dates Topics Reference Material
Jan 8 Course Introduction Syllabus
Jan 10 Lending & Lenders Chapter 1-Banking & the
Financial Services (Koch)
Jan 12 Lending & Lenders Chapter 1-Banking & the
Financial Services (Koch)
Jan 15 Financial Statement Analysis Chapter 1-Financial
Statements
Chapter 5-A Guide to
Earnings and Financial
Reporting
Quality (Fraser)
Jan 17 Financial Statement Analysis Chapter 1-Financial
Statements
Chapter 5-A Guide to
Earnings and Financial
Reporting
Quality (Fraser)
Jan 19 Financial Statement Analysis Chapter 6- Analysis of
Financial Statements
(Fraser)
Jan 22 Financial Statement Analysis Chapter 6- Analysis of
Financial Statements
(Fraser)
Jan 24 QUIZ 1, Financial Statement Analysis Chapter 6- Analysis of
Financial Statements
(Fraser)
Jan 26 Financial Statement Analysis Chapter 6- Analysis of
Financial Statements
(Fraser), CFA Presentation

6. Jan 29 Financial Statement Analysis Chapter 6- Analysis of
Financial Statements
(Fraser), CFA Presentation
Jan 31 PAPER 1 DUE, Financial Statement
Analysis
CFA Reading 26 (Cash Flow
Statements)
Feb 2 Financial Statement Analysis CFA Reading 27 (Financial
Analysis Techniques)
Fab 5 Financial Statement Analysis CFA Reading 27 (Financial
Analysis Techniques)
Feb 7 QUIZ 2, Financial Statement Analysis CFA Reading 27 (Financial
Analysis Techniques)
Feb 9 HOLIDAY
Feb 12 Financial Statement Analysis CFA Reading 27 (Financial
Analysis Techniques)
Feb 14 Financial Statement Analysis CFA Reading 31 (Long-term
Liabilities)
Feb 16 Financial Statement Analysis CFA Reading 31 (Long-term
Liabilities)
Feb 19 Financial Statement Analysis CFA Reading 32 (Financial
Reporting Quality)
Feb 21 Financial Statement Analysis CFA Reading 32 (Financial
Reporting Quality)
Feb 23 QUIZ 3, Financial Statement Analysis CFA Reading 33 (FS
Analysis: Applications)
Feb 26 Financial Statement Analysis CFA Reading 33 (FS
Analysis: Applications)
Feb 28 PAPER 2 DUE, Financial Statement
Anal.
CFA Reading 33 (FS
Analysis: Applications)
Mar 2 Credit Scoring Chapter 13 (Koch)
Mar 5 Credit Risk Chapter 3 (Koch)
Chapter 6- Other Credit Risk
Models (Saunders)
Mar 7 Credit Risk Chapter 3 (Koch)
Chapter 6- Other Credit Risk
Models (Saunders)
Mar 9 HOLIDAY
Mar 12 QUIZ 4, Loan Types, Issues, etc.
Mar 14 Loan Types, Issues, etc. Chapter 15 - Evaluating
Consumer Loans (Koch)
Mar 16 Credit/Loan Management Chapter 13-Credit Policy
and Loan Characteristics
(Koch)
Mar 19 Credit/Loan Management Chapter 13-Credit Policy
and Loan Characteristics
(Koch)
Chapter 16-Managing the
Investment Portfolio (Koch)
Mar 21 Credit/Loan Management Chapter 13-Credit Policy
and Loan Characteristics
(Koch)
Chapter 16-Managing the
Investment Portfolio (Koch)
Mar 23 QUIZ 5, Credit/Loan Management
Mar 26 Tools of Credit Analysis Chapter 6 - Analysis of
Financial Statements
(Fraser)
Mar 28 PAPER 3 DUE
Mar 30 HOLIDAY

7. Apr 2 HOLIDAY
Apr 4 Tools of Credit Analysis Chapter 6 - Analysis of
Financial Statements
(Fraser)
Case (Handout): Yell
Group Ltd. LBO
Apr 6 HOLIDAY
Apr 9 HOLIDAY

8. Apr 11 Methods in Credit Analysis Chapter 6 - Analysis of
Financial Statements (Fraser)
Case (Handout): AT&T
COMCAST
Apr 13 Methods in Credit Analysis Chapter 6 - Analysis of
Financial Statements (Fraser)
Case (Handout): Air New
Zealand
Apr 16 Methods in Credit Analysis Chapter 6 - Analysis of
Financial Statements (Fraser)
Case (Handout):US Forest
Products
Apr 18 QUIZ 6, Methods in Credit Analysis
Apr 20 Loan Portfolios Chapter 14-Evaluating
Commercial Loan Requests
and Managing Credit Risk
(Koch)
Apr 23 Loan Portfolios Chapter 14-Evaluating
Commercial Loan Requests
and Managing Credit Risk
(Koch)
Apr 25 LAST DAY OF CLASS-
PAPER 4 DUE
REVIEW
May 4 FINAL EXAM Cumulative