Profitability analysis

The course is reserved for program students and cannot be taken as a single master's course.

Profitability analysis is about how financial and other information about the company can be used by internal actors in the organization as a basis for decision-making to improve profitability. Assessing profitability is central to the course, and topics such as accounting profitability, economic profitability, product profitability, and customer profitability will be reviewed.

The subject includes the following main topics:

• Product profitability (ABC and traditional costing methods)
• Financial analysis and strategic analysis
• Activity focus and management (ABM)
• Customer profitability, customer segmentation, and markets
• Cost estimation and cost allocation
• Capacity costs
• Capital costs
• Segmentation

By the end of the program, the candidate will have advanced and in-depth knowledge of relevant economic and administrative theories and methods, concepts, and scientific approaches. Those who complete the program are expected to have achieved the following learning outcomes, defined in terms of knowledge, skills, and general competence.

Knowledge

• The candidate can analyze profitability for various activities, products, customers, and market segments and critically evaluate different methods in light of the historical development within the field.
• The candidate has in-depth knowledge of key tools within the field of profitability analysis.
• The candidate has detailed knowledge of the structure of financial statements and the reclassification of a balance sheet for analytical purposes.
• The candidate can apply knowledge from profitability analyses to assess profitability in organizations and analyze issues related to profitability improvements.

Skills

• The candidate can perform financial statement analyses and make adjustments to identify the true underlying earnings.
• The candidate can analyze profitability for various activities, products, customers, and market segments and critically evaluate different methods in light of the historical development within the field.
• The candidate can apply relevant product costing methods and techniques for estimating costs for various purposes and assess the extent to which these provide an accurate picture of the organization's profitability.
• The candidate can analyze profitability and use the analyses in various decision-making situations within the organization.

General Competence

• The candidate can communicate professional issues, analyses, and conclusions to both specialists (e.g., auditors, financial institutions) and the general public (e.g., employees, board members).
• The candidate can apply their knowledge and skills to new areas to carry out advanced tasks and projects.

If you pass the examination in this course, you will get an reduction in credits (as stated below), if you previously have passed the following courses:

• BED-3075 Profitability analysis and revenue management 5 ects
• BED-3078 Valuation of enterprices 5 ects

The course involves various teaching methods on campus, with sessions lasting between 2 to 4 hours per session. Students are required to be physically present on campus, as the course is structured to include mandatory activities that involve collaboration with other students. The teaching format will be a combination of lectures, practical seminars, group work, presentations, and feedback.

It is the student's own responsibility to ensure they receive the information provided during the teaching sessions, which is not explicitly described in the course description, the lecture plan, or posted on Canvas.

Language of instruction and examination

Schedule

More info about the coursework requirements

There are two mandatory assignments in the course:

• Assignment 1 is based on the first part of the curriculum.
• Assignment 2 is based on the second part of the curriculum.

Approved assignments are valid for four consecutive semesters, starting from the semester in which the assignment was completed.

Re-sit examination