Review popular tools and techniques for analyzing and interpreting:
- Balance sheets
- Income statements
- Cash flow statements
Learn how to answer the following questions:
- I can read financial statements, but what do they really tell me about the business?
- Where are the best places to do research and get comparative statement data?
- How do lenders and creditors interpret financial statements differently than owners/managers?
- How should shareholders/investors measure performance and return on investment?
- What are the alternate methods of measuring results and what are their relative merits?
- Is liquidity adequate to get bills paid? Will our leverage level frighten lenders or investors?
- Should we manage for profit, profit margin, or cash flow?
- Balance sheet analysis
- Income statement analysis
- Cash flow analysis
- Topics in performance measurement/financial statement analysis
- The attendee will be able to analyze balance sheets, income statements and cash flow.
- The attendee will be able to implement the lessons learned in the case study to daily practice.
- The attendee will be able to discuss topics surrounding performance measurement.
8:30 a.m. - 10:30 a.m.
I. Balance Sheet Analysis
A. Balance Sheet Review, Eyeball Analysis, Common Size Statements
B. Working Capital, Current And Quick Ratios For Liquidity Analysis
C. The Cash Operating Cycle – A Graphical Approach
D. Days Sales Outstanding For Operating Efficiency
E. Inventory Turns/Days Sales In Inventory For Inventory Management
F. Days In Accounts Payable
G. Cash Conversion Cycle
H. Asset Valuation Issues
I. Business Valuation Issues
10:30 a.m. - 10:40 a.m.
10:40 a.m. - 11:00 a.m.
I. Balance Sheet Analysis (Continued)
J. Debt To Equity And Overtrading Ratios For Leverage Analysis
K. The Z-Score
L. Additional Balance Sheet Ratios
11:00 a.m. - 12:00 p.m.
II. Income Statement Analysis
A. Income Statement Review, Common Size Statements, Various Analysis
B. Operating Leverage And Break Even, Contribution Margin
C. Profit Margins: Gross Margin, EBITDA, Operating Margin, EBIT, Net Margin
D. Return On Assets And Return On Equity
E. Dupont Formula, Economic Value Added
12:00 p.m. - 1:00 p.m.
Lunch (On Your Own)
1:00 p.m. - 1:30 p.m.
II. Income Statement Analysis (Continued)
F. Interest Coverage And Payment Coverage Ratios
G. Additional Income Statement Ratios
H. Limitations And Distinction From Cash Flow
1:30 p.m. - 2:40 p.m.
III. Cash Flow Analysis
A. GAAP Cash Flow Statement, Three Types Of Cash Flow, Direct vs. Indirect
B. Sources And Uses Of Funds Approach
C. Checkbook Approach
D. Cash Flow Forecasting
E. Cash Flow Ratios
2:40 p.m. - 2:50 p.m.
2:50 p.m. - 3:35 p.m.
IV. Case Study
3:35 p.m. - 4:30 p.m.
V. Topics In Performance Measurement/Financial Statement Analysis
A. Performance Measurement, Benchmarking
B. The Balanced Scorecard
C. Activity Based Costing
D. Financial Statement Misrepresentation Issues, Including Revenue Recognition