Finance for the non-financial manager

Finance for the non-financial manager

Designed for managers and other professionals who need an understanding of the financial drivers of business, this course provides an introduction to the concepts underlying ’external’ financial accounting and ’internal’ management accounting. You’ll be introduced to the skills necessary to prepare, interpret and analyse financial statements, and will gain an insight into how your business decisions impact the financial reports of your company. We’ll also cover budgeting, costing and key performance indicators, and clarify the often misunderstood area of accrual accounting.

For many managers, the company’s financial statements remain a mystery. However, as these managers move into increasingly senior positions, incentives are frequently tied to those very statements, and discussions regarding financial performance become more regular. A basic understanding of both financial statements and project evaluation tools allows for rational decisions and intelligent discussions.

PROGRAM CONTENT
Analysis and Interpretation of Financial Statements
The Income Statement
�Defining revenue, cost of sales, and gross and net profit
�Differentiating between capital and operating expenditures
The Balance Sheet
�Assets, liabilities, and equity
�Current and fixed assets
�Short-term versus long-term liabilities
�Depreciation and retained earnings

Using Ratios to Analyze and Interpret Statements
Deriving meaning from company financial statements
Common financial ratios
Using ratios to determine financial strength, viability, and liquidity
Relating leverage levels to risk

Cash Flow and Working Capital Management
The Cash Flow Statement
�Recognizing the difference between profit and cash
�Identifying the key elements of the cash flow statement
�Determining historical operating cash inflows and outflows
Working Capital Management
�Optimizing the impact of working capital on cash flow
�Forecasting future cash flows
�Controlling inventory levels
�Managing receivables and payables

Pricing, Costing, and Break-even Analysis
Deriving Optimum Costing
�Classifying fixed and variable costs
�Comparing costing techniques
�Marginal costing and contribution
�Absorbing direct and indirect costs into products or services
Analyzing Break-even Points
�Calculating a project’s break-even point
�Evaluating a product discontinuation decision

Project Evaluation
Assessing the financial viability of capital investments
Evaluating the limitations of ROI and payback
Appraising potential capital investments using discounted cash flow techniques

We can provide customized training programs in virtually any business or management area tailored to meet your specific needs, in terms of
content, length, timing and location as well as the use of exercises, examples and case studies relevant to the participants‿work. Our customers
include Fortune 500 companies, small businesses, federal, state and local government, and international organizations.

Finance for the Non-Financial Manager will help you make better management decisions by improving your financial skills and providing proven financial tools for measurement and evaluation. Session leaders have broad experience in industry and years of executive development experience.

The program is built around four themes:

1 - Interpreting Financial Reports
The ability to decipher and understand key financial and accounting statements is an important skill for managers and executives in all areas of the organization. The program will provide insights into the following areas:

Understanding the essentials of accrual accounting
Learning how to read financial statements such as balance sheets, income statements, cash flow statements, and statements of retained earnings
Understanding financial concepts such as depreciation, sunk costs, retained earnings, and goodwill
Identifying the difference between market value and book value, economic income and accounting income, depreciation and capital cost allowance, income and cash flow
Choosing the accounting method with the most positive impact on earnings
Interpreting cash flow patterns and recognizing trends in financial performance
Understanding the two major international accounting models
Analyzing financial statements for competitive advantage
Developing a financial reporting strategy to communicate value to stakeholders
2 - Using Financial Tools To Make Better Business Decisions
Making better business decisions means making informed business decisions. The program will provide the tools to help you assess your organization’s health and evaluate future direction.

Assessing working capital requirements
Measuring the performance of business units
Analyzing the nature of an organization’s earnings
Using financial ratios to improve liquidity, profitability, capital structure and asset utilization
Analyzing cost behaviour and conducting a break-even analysis
Knowing the theory and terminology of cost systems in order to challenge inappropriate cost allocations
Applying the principles of Activity Based Costing and Target Costing to your operations
Using financial and operating leverage to improve performance
Employing sensitivity analysis, break-even analysis, keep/drop analysis, and scenario analysis to improve decision-making
Calculating the value of a business
Identifying relevant costs and revenues for decisions such as adding or dropping product lines, outsourcing, or organizational restructuring
3 - Analyzing Business Investments
In the program you will learn to apply concepts to make more effective decisions on capital expenses, capital budgeting, and funding new initiatives.

Deciding how to finance operations (alternative financing decisions, choosing between various financial instruments, techniques for evaluating financing alternatives, supporting sustainable growth)
Evaluating the expected rate of return for alternative projects
Appraising investment opportunities and ranking capital investment alternatives
Using financial tools such as Net Present Value (NPV), Internal Rate of Return (IRR), nominal and discounted payback, and Return on Assets (ROA) to evaluate capital investment opportunities
Determining an organization’s cost of capital and how it can be used as a hurdle rate for investments
Assessing how an investment will impact financial statements
Understanding how to use Discounted Cash Flow (DCF), Economic Value Added (EVA), and Cash Value Added (CVA) for operating decisions
4 - Developing a Financial Strategy
The program will help you understand the link between finance and business strategy, and teach you how to develop a financial strategy to create competitive advantage.

Understanding how financial analysis fits into the broader decision-making framework, and the role of finance in the business planning cycle
Assessing the impact of financing options on an organization’s cost of capital
Reviewing alternate sources and forms of financing
Understanding the impact of financial markets on organizational decision-making
Creating competitive advantage through tax planning
Reviewing new developments in innovative financial instruments such as swaps, forwards, futures, options and derivatives
Assessing the financial health of competitors by analyzing financial reports and the nature of a firm’s earnings, and by identifying performance trends
Developing strategies for managing corporate and personal tax
Creating a culture committed to shareholder value

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