Best Practices in Financial Analysis, Planning & Control

Objective:

By attending this Best Practices in Financial Analysis, Planning & Control training course, delegates will be able to:

• Explain basic financing concepts, terminology, principles, processes and procedures that govern how the financial statements are prepared
• Know the importance of accounting in running businesses
• Explain the components of an annual report
• Understand how financial information can be used to analyse business operations and make economic decisions
• Effectively prepare balance sheets and income statements
• Analyse a set of financial statements to evaluate the business financial health
• Differentiating the financing options available to a business and situations where each might be used
• How to prepare and implement advanced planning and control techniques into your budgeting process
• Know how to integrate the budgeting process with the development of the company’s long-term strategic vision
• Know how to provide a decision support structure that provides timely and useful information to decision makers
• Develop ways to increase profitability and performance through streamlined planning and reporting

Content:

Objectives & Fundamentals of Finance

• Measuring company performance
• Introduction to finance: Terminology
• Purpose of financial analysis and reporting
• The finance role in running businesses
• Walking through an Annual Report
• The Role of External Auditor
• Users of accounting and financial information
• Profit and profitability
• The Context of Financial Analysis and Decision-making

Financial Statements

• Understanding the Financial Statement
• Why are ratios useful
• Horizontal and trend analysis
• Vertical analysis: common size statements
• Building blocks analysis and reading through the numbers
• Profitability ratios
• Limitations of financial ratio analysis

Analysis of Investment Decision

• Cost behavior: fixed, variable, semi-fixed cost
• Understanding Cost behavior and types of costs
• Net Present Value (NPV) and Internal Rate of Return (IRR)
• Strategic Perspective
• Plan for Cost Reduction and Profit Improvement
• Costing Approaches – Full Absorption, Marginal, ABC
• Cost volume profit analysis (CVP)
• Break-even Analysis
• Dealing with Risk

Strategic Management Framework

• What is a budget?
• The objectives of budgeting
• Types of Budgets
• The budget process
• The Role of Budgeting
• How to identify problems and limitation of budgetary control
• Approaches to Budget Development
• Using budgets to manage organisational performance
• Finance and budgeting teams-role in supporting strategic planning
• Capital budgeting techniques & Cash Flow
• Using Activity-based Budgeting
• Developing the Cash Budget

Advanced Valuation Techniques

• Business risk and cost of capital
• Classifying investment projects
• Analysing investment and operating cash flows
• The time value of money concept
• The required rate of return
• Net Present Value (NPV)
• Internal Rate of Return (IRR)
• Multiple internal rates of return
• Modified Internal Rate of Return (MIRR)
• Profitability Index (PI)
• Payback period and discounted payback period
• Capital rationing
• Comparing and evaluating techniques