Hello, I'm Christ Ittner, an EY professor of accounting at Wharton where I specialized in Management Accounting and Performance Measurement issues. Welcome to week four of accounting analytics. The topic for week four is linking non-financial metrics to financial performance. And then the next lecture will start to dig in into that subject. Before we get started on the substance, I want to briefly explain how this topic fits with and complements what you've learned from Professor Boucher in weeks one, two, and three. Professor Boucher went over some accounting fundamentals and then delved into different techniques such as ratio analysis and fraud detection, that you can use to analyze a company's financial reports and make conclusions about that company's financial health, outlook, and the extent to which the results might have been managed or manipulated. These techniques taking external perspective and focus on the numbers. What are the publicly reported financial reports telling us about this company? I'm going to shift a bit to a different perspective and talk about how do you go beyond accounting numbers with analytical mindset to predict financial outcomes? It's either a manager or an external financial statement users, what are the key non-financial performance measures you can use to forecast a firms future financial results? When thinking about accounting analytics, it's important to have an understanding of both of these perspectives. From an external firm valuation standpoint, the ultimate goal is assessing a companies financial viability and long-run financial prospects. Any information that can help you predict these outcomes should be incorporated in the analysis. Although Professor Boucher emphasized the use of publicly available financial reports, value relevant information may or may not come from financial statements. For example, if a company suffers a dramatic decline in customer satisfaction, it's likely the company's ongoing financial viability and prospects will also decline dramatically in the future. Unfortunately, customer satisfaction information is not included in financial statements. It just be gathered from other sources. External financial statement users should take this type of non-financial information into account when conducting the analyses covered in weeks one to three. More importantly, accounting analytics is not limited to methods for external financial statement users to evaluate companies. For an internal decision making standpoint, managers must decide which financial and non-financial actions to take in order to increase the company's long term value. For example, would the company be better off spending money on reducing defects or increasing customer satisfaction with the sales process? When measuring a manager or business unit's performance, which financial and non-financial performance measures actually tells us where at the managers are taking actions that actually improved long term financial performance. Like the external analysis covering week's one to three, the goal of internally focus accounting analytics is using any available financial and non-financial information to predict the drivers of financial viability and future financial outcome. That's why these ideas are presented together in this course and I look forward to talking about linking non financial metrics to financial performance in the following lectures. Let's get started.