Finance for Non-Financial

Course objective :

By the end of the course, participants will be able to:

• Overcome the barrier of the accountants’ strange language
• Improve their understanding of your organization’s finance function
• Understanding the content of, and relationships between, primary financial statements (income statement and balance sheet)
• Radically improving their planning, controlling and budgeting skills
• Be much more aware of the impact of their decisions on the performance of your organization
• Identifying the main sources of finance available to a business
• Identifying the main elements of working capital
• Using comparative ratio analysis to pinpoint areas of concern

Course Outline  :

Day 1 : Introduction to Accounting and Finance

• What are accounting and finance
• How are the users of accounting information?
• Why do I need to know anything about accounting and finance?
• Accounting as information system
• Financial accounting and management accounting
• How is business managed?
• What needs to be accounted for in the context of a business model?
• Key accounting concepts
• Assets, liabilities and equity
• Accounting equation
• How does the value of capital change
• The Accounting cycle
• Accounting Policies and Underlying Assumptions
• Examples, Problems and Illustrative Case Studies

Day 2 : Measuring and Reporting Financial Position and Financial Performance

• The major financial statements- an overview
• The statement of financial position (balance sheet)
  • Current assets and liabilities
    • Inventory / Stock
    • Receivables
    • Payables
  • Non-current assets
    • Property, plant and equipment
    • Depreciation

• Intangible assets
  • Patents and licences
  • Goodwill (introduction to group accounts)
  • Amortisation and impairment
• Income Statement (the Statement of Financial Performance)
  • Recognizing revenue
  • Recognizing expenses
• Examples, Problems and Illustrative Case Studies

Day 3 : Planning and Controlling - Costing and Budgeting

• Understanding cost structure and behaviour
• Costs as a relationship to outputs – cost / volume / price relationship
• Fixed costs vs variable costs
• The concept of contribution margin
• Break-even analysis for planning and control
• Nature and purpose of budgets for planning and control
• Types of budgets and budgeting
• Budgetary control and variance analysis
• Budgeting for non-financial measures – Key Performance Indicators and the Balanced Scorecard
• Examples, Problems and Illustrative Case Studies

Day 4 : Financing a Business and Making Investment Decisions

• Source of finance
  •   Sources of internal finance
  • Sources of external finance
• Long-term vs short-term borrowing
• Financing decisions
  • Debt vs equity
  • Types of share and share issues
• The nature of investment decisions
• Investment appraisal methods
• Accounting rate of return (ARR)
• Payback period (PP)
• Nets present value (NPV)
• Why NPV is better
• Internal rate of return (IRR)
• Examples, Problems and Illustrative Case Studies

Day 5 : Accounting Information and Financial Analysis

• Identifying key success factors in an industry sector
• The analysis framework
  • Profitability
    • Growth
    • Margins
    • Earnings per share
  • Efficiency
    • Working Capital Days
    • Cash Cycle
    • Short Term Financing
    • Return Ratios
  • Liquidity
    • Current Ratio
    • Quick Ratio
    • Interest Cover
  • Solvency
    • Gearing
    • Leverage
    • Investor Ratios
    • Dividend Yield
    • Total Shareholder Return
• Examples, Problems and Illustrative Case Studies