Learning Outcomes

Financial decisions are critical in any business, knowing the right questions to ask and understanding the impact of decisions made is critical. This course aims at giving you the basic finance and accounting knowledge you will need to drive growth in your organisation.

Topics include selected aspects of finance that would be beneficial to a non finance specialists including; Interpretation of financial statements, DuPont Analysis, working Capital management, financial impact of strategic decisions, cash flow drivers and more.

By the end of this course, participants will be able to;

• Understanding the Importance of Financial Analysis
• Company Annual Reports – What they are and are not
• Understanding Financial Terminology & Presentation
• Analysis of the Income Statement • Analysis of the Balance Sheet
• Cash Flow Statements Analysis and Why Cash Is King
• Understand and interpret the Working Capital Cycle
• Detailed Shareholder return analysis using DuPont Ratio Analysis
• How to detect Earnings Management • Common Size Presentation, Comparative And Industry Analysis- Strategy, Success & Failure: SWOT & PEST Analysis, Good Sources Of Information, Corporate Governance, Corporate Strategy
• Risk Analysis using simple risk models like the Z-score
• Capital & Valuation: Defining Debt And Equity, Gearing and Leverage
• Why read the footnotes: Learn about off Balance Sheet Items (How A Company Can Be Legally 100% Equity In The Books But In Actual Fact Is 100% Debt)
• Basic overview of valuation and how to identify valuable companies

Other Details

Who Should Attend?

Everyone in an organisation with limited financial analysis skills including; Lawyers, Senior Executives, Board members, HR Administrators, Stockbrokers

Prerequisites
None

Learning Process
Blended learning methodology using group discussions, exercises, case studies and online revision tools.

Maximum class size
for In-house/Open Delivery – 20.

DAY 1

Overview of Accounting & Financial Statements

• What is Financial Statement Analysis
• Quick Review of Accounting Concept
• The Accruals Concept
• Company annual reports – what they are and are not
• Understanding financial terminology & presentation

Financial Reporting & Basic financial Analysis

• What financial statements are and what they’re really supposed to tell us
• Understanding the rules of accounting standards (IFRS, GAAP, SAS etc.) and how it applies to your analysis
• Horizontal Analysis
• Vertical Analysis
• Common size Statements
• Comparative/industry analysis
• Other Analytical Procedures

Analysing Financial Performance & Profitability

• Understanding the P&L structure and lines
• Calculate and Evaluate various profitabilty measures
• understanding return on assets and return on equity
• Using the price-earnings ratio to compare stock values
• The relationship between earnings and stock returns
• What interest coverage means

Analysing the Financial Position & Sustainability

• What goes into working capital and how it can increase and decrease during the normal course of business
• Valuing assets and why it can be tricky
• Calculating a Company’s operating cycle
• Important things the Balance Sheet can tell you about a business
• Sorting through the Balance Sheet: Assets, liabilities and equity
• The role of the Z score in predicting bankruptcy
• Why you must review and understand footnotes to the accounts
• Ways the Balance Sheet can misrepresent-and mislead
• How to recognize warning signals early on-before a crisis occurs

DAY 2

Analysing the Cash flow Statement

• Understanding the purpose of the cash flows statement
• Types of cash flow statements
• The key test of cash flows health
• Why Cash is King • Interpreting cash flow patterns • Cash vs Income, what you should know
• Cash management tools

Ratios Analysis Practice Session (Case Studies):

• Detailed Dupont Analysis
• Accounts receivable analysis
• Asset and Activity Ratios
• Financing ratios – Analyse the Company’s capital structure with debt-to-equity ratios
• Finding the optimal capital structure
• Interest coverage ratios
• Using ratios to predict trends

Other Topics

• How financial statements often conceal more than they reveal
• What is Earnings Management • How to detect Earnings Management
• Ethical consideration and Corporate Governance
• Accounting Standards and how they affect your analysis.
• PEST Analysis • Time Value of Money calculations
• Wrap up and Q&A