Financial Analysis Evaluation, Budgeting and Decision Making

This programme will challenge delegates to:

• Learn how to use financial statements to evaluate the financial / strategic performance of an organization
• Understand discounted cash flow (DCF) techniques and their application to financial decision making
• Use ratios to quickly pinpoint areas of concern
• Identify key success factors, weak financial signals, and strong financial signals in your own industry sector
• Learn the metrics used by the world’ leading companies, how to use them, & why
• Confidently project your firm’s future performance through real-world budgeting

Objective

• Statements (income statement, balance sheet, and statement of cash flows)
• Learn how to use financial statements to evaluate the financial / strategic performance of an organization
• Understand discounted cash flow (DCF) techniques and their application to financial decision-making
• Identify key success factors, weak financial signals, and strong financial signals in your own industry sector
• Understand how EVA® (Economic Value Added), SVA (Shareholder Value Added), RONA (Return On Net Assets), and more
• Define the value creation/destruction process in mergers and acquisitions from the market perspective and signals to management from the market
• Learn how to build a budget that’s works and the variations
• Identify sources of financial and business data that provide insights into business and financial strategies
• Use and build EXCEL spreadsheets for financial analysis: from the basics through complex models
• Enhance personal networks of similarly minded high potential managers.

Day 1 - Getting started with Financial Analysis

•   The role & responsibilities of financial management
•   The relationship between accounting & finance in analysis
•   A review of the basic financial statements and their roles
•   Why ROI is still a good place to start
•   Identifying key success factors in your industry sector
•   Ratios: what they are, which ones to use, & why
•   Financial review compared to targets and expectations
•   Financial performance measurement systems
•   Key accounting assumptions
•   Case study – Beginning to analyse example

Day 2 – Moving beyond the basics in financial analysis

•   The two kinds of Free cash flow (FCF)
•   Altman’s Z-Score and what it really means
•   Du Pont analysis and what it tells us
•   Scenario analysis: how to calculate it & what it tells us
•   Sensitivity analysis: how to calculate it & what it tells us
•   Trend analysis: when is a trend a trend? What to do?
•   Improving Return on Equity (ROE)
•   Case study – Continue the example analysis

Day 3 – Evaluation of the information

•   How do I interpret these details?
•   What are the important metrics & why?
•   Annual reports, footnotes and beyond; what can they signal?
•   Short-term success evaluations process and measures
•   Industry data, sources, & uses
•   Benchmarking for evaluation purposes
•   EVA, RONA, EBITDA, etc.: what do they mean & how to use them?
•   Calculating the results of analysis
•   Case study – Complete the example analysis

Day 4 – Budgeting and the Management Process

•   Strategy - direction and vision
•   Implementing strategy - the operational planning process
•   Budgets - the financial expression of the operating plan
•   The purpose of budgets - control
•   The human side of budgeting
•   Elements of the budget framework
•   Advantages and limitations of budgets
•   Reporting - the key to control
•   Case study – Beginning to prepare the budget

Day 5 – Completing the budget using the tools we have learned

•   Assumptions
•   Master budget
•   Proforma financial statements: Income statement, balance sheet, cash flow statement
•   Capital expenditure (CapEx) budget
•   Sales & marketing budget
•   Production budget
•   General & Administrative budgets
•   Case study: Complete the budget