The importance of Financial Accounting
Hey PE monkeys,
I'm hopefully doing a PE internship this summer, but have not taken any accounting classes. Thus I need to brush up a bit.
I know how a 3-statement model works and its connections etc. Meaning of different line items.
However, I have the opportunity to do a class in Financial Statement Analysis or Financial Accounting. Which would you prefer I did as prep?
Is it essential for a PE analyst to actually have taken classes in Financial Accounting?
Sorry if my question is stupid.
Happy new year to ya all
I wasn't a business major but I'm pretty sure financial accounting would be the basis of any other classes revolving around finance/accounting (including financial statement analysis).
"Is it essential for a PE analyst to actually have taken classes in Financial Accounting?"
No, but I would highly recommend it.
Thank you. Your comment is well received.
It is a prerequisite to complete the course, you're correct. But I wouldn't it be more important to analyze and understand financial statements and not necessarily know the rules of producing one - which is something I feel like the financial accounting course is much about.
Knowing the rules of producing the statements isn't the point. You need to know how the financial statements connect to one another, more specifically how the B/S, P/L, and CF connect to each other.
You can't build a 43-story skyscraper without laying some groundwork first.
That is exactly where I am getting at. I already know how the statement links and so on. So do I really need to spent 3 credits learning how to be an accountant, or should I rather spent 3 credits on learning on financial statement analysis.
You should take both in all honesty. Sometimes it's not what you don't know that gets you in trouble, it's what you think you know but are actually wrong about. If you already know the material it should be a breeze anyways, right?
Definitely take financial accounting. From someone who has taken 3 financial accounting courses, it was a bitch but can definitely give you a huge leg up in understanding the ins and outs of the balance sheet, C/S and income statement and some of those accounts in detail as well as the treatment for them.
Is "Financial Accounting" Helpful? (Originally Posted: 07/07/2009)
Hi everyone,
I am an undergrad contemplating taking an introductory accounting "Financial Accounting" at the graduate level.
I haven't really thought about going into accounting before, but with this basic knowledge of accounting, I think I could go either directions after graduation.
But my question is how much difference does it make if I take this course? Do you think this course will be regarded valuable or useful by investment banks at all? Or is it totally useless and irrelevant to banking jobs?
Any advise will be greatly appreciated.
wow, intro financial accounting is probably the most useful class for any prospecitve investment banker...
unless you are looking to do quant finance, which is stats and programming based, accounting is the lingua franca of finance.
Yea, I agree with the above post. An intro accounting course is the absolute MINIMUM you should take. I majored in finance and seriously regret not taking more accounting courses to supplement the few lower level courses I took.
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everyone i've talked to told me financial accounting is the most important class to take during the first two years of college at Southern Cal.
If there was one single prerequisite for IB, or just about any corporate finance related career...it would be financial accounting.
To agree with everyone else, financial accounting is absolutely beneficial to a career in banking. I took financial, managerial and advanced financial accounting (no, I was not an accounting major), and the combined knowledge I gained from the classes definitely helped me land my boutique IB internship, and, ultimately, my FT BB role.
While it is not essential by any means, it definitely helps to have a leg up over a lot of the competition, and by knowing financial accounting, you allow the interviewer to ask you more interesting valuation and analytical questions - strong answers to those questions will definitely help you to shine in the interview.
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On a scale of 1 to 10, financial accounting is about a 12.
"Banking - It is what it is"
Wow! I am so glad I asked you guys before making a decision on my own. I had no idea how important it was. Thank you very much!
Yeah, useful. But also deadly boring, especially at the intro level.
I took financial accounting and as an undergrad interested in finance (assuming you go to a school that does not have a finance major), it is easily one of the more interesting, real-world applicable courses you will take. Definitely beats out micro econ
How did you go about taking graduate courses as an undergrad though?
No, finance and accounting majors are not offered at the undergrad level at my college. Introductory graduate courses are mostly open to undergrads as well with one caveat being that not all of these courses are accepted by the college towards your degree or major.
While Financial Accounting is important, I think finance is 95% about previous work experience and networking rather than coursework / GPA, so long as you meet the minimum thresholds there.
Edit: I've just come up with a brilliant idea. Since it may not be taken for credit, why would I register for the course and pay $4k? I can just show up and learn things without all the hassle of sitting exams.
Definitely a smart move. Will they allow you to audit a graduate level course for free?
As far as I know, auditing is very limited to certain disciplines and neither econ nor biz courses are open to auditors. But if classes are large (50+ students,) then one could just blend in. I suppose what really matters is the knowledge gained in the course rather than a letter grade on my transcript.
Financial Accounting Workshops (Originally Posted: 09/18/2013)
...By John A. Harris.
What's the consensus here from anyone who has been to one?
I'm thinking of attending the New York session in October to make sure I pass the CFA Level I...
Is this seminar legit ?
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