Financial Management Skills for Office Administrators & Secretaries

Objective:

• Appreciate the importance of the accounting and finance function, and how it links with every part of the organisation, and its suppliers, customers, shareholders, lenders, and society in general
• Understand commonly used finance and accounting terminology thereby allowing them to make a valuable contribution to the workplace in meetings or in a supportive role
• Understand the principles of accounting for routine business transactions
• Be able to summarise the results of business transactions over a period of time, and prepare simple financial statements, including the Income Statement, Balance Sheet and Cash Flow Statement
• Be able to analyse and compare company performance using basic ratios
• Understand how costing and budgeting techniques can help the company to maintain efficiency and profitability

Content:

Introduction to Finance and Accounting

• What is accounting? What is finance?
• What are the major sources of Long-term and Short-term finance?
• What is Financial Accounting?
• What is Management Accounting?
• Simple rules of double-entry bookkeeping that can be applied to all financial transactions
• How to record the things you buy and the things you sell
• How to record business payments and receipts
• What is depreciation? Explanation of the various methods and their impact on profit

The Financial Statements

• How to prepare basic financial statements – the Income Statement and the Balance Sheet
• The key elements of financial statements defined and explained
• How is the profit calculated?
• The difference between revenue & capital expenditure
• Assets – current and non-current
• Liabilities – current and non-current
• The meaning of working capital
• Company net worth
• Profit or cash – what is the difference?

Basic Evaluation of Financial Statements

• Why do we need to evaluate financial statements?
• Who are the stakeholders and what are their information needs?
• How to – common-size financial statements for ease of comparison
• How to calculate accounting ratios
• How to use ratio analysis to assess performance
• Profitability ratios
• Liquidity ratios
• Operating efficiency ratios
• Gearing ratios
• The Cash Flow Cycle and Working Capital
• Valuing a company – Book Value versus Market Value

Introduction to Costing Systems

• Collecting and analysing costs
• Types of cost analysis: by type, by location, by behaviour, by purpose
• What are overheads, and how should we analyse them?
• What is the Cost of Production – Marginal and Total Costing explained
• What is inventory, and how does it affect the cost of production?
• Methods of valuing inventory – FIFO, LIFO, and AVCO explained
• Marginal Costing – how costs and profit vary with volume
• How to measure the break-even point and the margin of safety
• What-if Analysis

Budgets

• Why do we need budgets? – the link between corporate strategy and operations at all levels of the organisation
• The benefits & limitations of budgets
• The key features of budgets
• Basic budget forecasting techniques
• How to prepare a departmental budget
• Comparing actual performance with the budget – Variance Analysis
• Do budgets motivate or de-motivate?