Course outlines:

Module one:

The key financial statements

• Understanding the accounting cycle
• The five main accounts in financial statements
• Income statement: tool for performance measurement
  • Accrual basis versus cash basis
• Balance sheet: tool for financial position
  • The balanced status
• Statement of owners’ equity
• Statement of cash flows: cash is king
• Wrapping up: the cycle of financial statements
• External and internal auditors’ responsibilities

Module Two:

Analysis of financial statements

• Why are ratios useful
• Horizontal and trend analysis
• Vertical analysis: common size statements 
• Building blocks analysis and reading through the numbers:
  • Liquidity ratios: ability to settle short-term dues
  • Solvency ratios: ability to settle long-term dues
  • Activity ratios: ability to manage assets efficiently
  • Profitability ratios
  • Limitations of financial ratio analysis

Module Three:

Working capital management

• Definition of working capital and working capital management
• Working capital management strategies for current assets
  • Balancing profitability and liquidity
• Working capital management strategies for current liabilities
  • trade-off between profitability and certainty

Module Four:

Recap: concept of financial management

• Accounting versus finance: rules and responsibilities
• Three pillars of finance
  • Financing decisions
  • Investing decisions
  • Operating decisions

Module Five:

Breakeven analysis and decision making

• Defining fixed costs
• Defining variable costs
• Contribution margin formula
• Computing breakeven point
• Sensitivity analysis: changing assumptions

Module Six:

Operating budget process and techniques

• What is an operating budget?
• Steps to budget development
• Master budget components
  • Sales forecasting
• Approaches to budgeting
  • Incremental budgeting
  • Zero-based budgeting
• Budgetary control and correction

Module Seven:

Capital budgeting: the investing decisions

• Examples of exercises involving capital budgeting exercise
• Time value of money: a prerequisite for investing decisions
• Required rate of return for investments
• Examples of cash outflows for capital projects
• Examples of cash inflows for projects
• Net present value calculation
• Internal rate of return