Advances in Financial Education
Financial ratio analysis is a topic covered in most business courses in accounting and finance, but the traditional methodology used suffers from what can be termed the "cookbook approach." Students are typically assigned simple exercises at the end of chapters which involve the computation of ratios measuring liquidity, leverage, turnover, and profitability. Students are then asked to compare the calculated ratios to a given industry average. These are merely sterile exercises which fail to expose students to the application of financial analysis in real world scenarios. A more effective curriculum would incorporate a complete analysis of actual firms, using sophisticated techniques which have been proven to be more effective in assessing financial strength.
Business education; Business students; Ratio analysis
Citation: Pilot Scholars Version (Modified MLA Style)
Gritta, Richard D. and Adrangi, Bahram, "The Use of Bankruptcy Forecasting Models in Teaching Applied Ratio Analysis in Investment and Financial Statement Analysis Courses" (2014). Business Faculty Publications and Presentations. 29.