Financial Awareness

Introduction:

Business professionals need to understand the financial factors critical to business success. This course will show how finance works in today’s fast-moving business environment. For any business the key elements of profitability, liquidity, and financial structure are critical to continuing success and competitiveness. So these three elements are comprehensively explored and developed at all levels of business activity.

You will learn about the accounting processes of recording and reporting business transactions, and how these are summarised as periodic financial reports following statutory requirements. You will also learn how these financial reports are analyzed by a variety of user groups.

This seminar also has an inward focus, and will explain why management accounting is essential to business survival, and success. It will show how budgeting can control costs and improve profitability. It will explain and develop tools and techniques for evaluating proposed new investment projects. This training course will enable you to understand the business from both a financial and strategic perspective and how business decisions will impact on corporate profitability.

Targeted Groups:

• Project Professionals
• Internal Auditors
• Any Non-financial Professionals who are required to Read, Interpret, and contribute to Business Financial Reports
• Senior Professionals of Manufacturing, Marketing, Engineering
• Human Resources Professionals
• Legal Professionals
• Executive Professionals who are involved with the Development of Long-Term Customers, Suppliers, Outsourcing Partners, and other Global Strategic Alliances
• Consultants who work with Professionals and Executives, to support Improvements to Operational and Financial Processes

Course Objectives:

At the end of this course the participants will be able to:

• Explain the nature and role of financial statements and their interpretation
• Use the language of accounting and finance to communicate effectively with financial professionals
• Review the financial performance and financial position of an organization using the appropriate financial Ratio and Break-even analysis techniques
• Use budgetary control to compare actual against planned performance and to identify corrective actions
• Evaluate investment projects using DCF and other appraisal methods
• Learn more about accounting and finance systems, and the meaning of financial reports
• Contribute to financial discussion, and communicate in financial language
• Contribute to the effective financial management of their organization
• Evaluate alternative courses of action and identify the most effective choices about the future improvement of their organization
• Liaise more effectively with other departments on financial matters

Targeted Competencies:

• Understanding financial statements
• Financial analysis
• Working capital management
• Preparing operating budgets
• Making capital budget decisions
• Financial decision making

Course Content:

Unit 1: Understand the Financial Consequences of Running a Business:

• Discover where a business gets its money from
• Find out what a business does with its money
• Appreciate the need to record, analyze and summarise business transactions
• Figure out what the finance department does
• Identify essential business financial systems
• Check financial controls are in place
• Know the difference between financial and management accounting
• Produce quality management information

Unit 2: Get to Grips with Accounting Fundamentals:

• Make sense of accounting jargon
• Discover why not to use cash accounting' and why timing is essential
• Watch out for hidden accounting costs
• The basics of debits and credits
• Discover what all the accounting books are used for
• Understand balance sheets
• Understand profit and loss accounts
• Understand cash flow statements
• Know who uses the financial statements and why
• Be aware of accounting regulation and law

Unit 3: Know What Makes a Profit:

• Know the importance of price and its relationship to volume &revenue
• Realize that not all costs are the same
• Understand how gross margins work
• Appreciate the difference between gross and net margins
• Work out the breakeven point and margin of safety
• Be aware of tax consequences

Unit 4: Manage The Cash:

• Understand why cash is king
• Find out where all the cash has gone
• Know how to generate cash from stock management
• Know how to generate cash from customers
• Know how to generate cash from suppliers
• Be able to prepare and use a cash flow forecast

Unit 5: Prepare and Use a Financial Budget as Part of Your Planning:

• Know the basics of budgeting
• Find the principal budget factor
• Chose the best way to budget
• Use forecasting techniques to form the budget
• Watch out for issues when setting budgets
• Watch out for issues when monitoring budgets
• Calculate variances from budget
• Explore alternatives to budgeting

Unit 6: Evaluate Opportunities Financially:

• Only consider the relevant costs for decision making
• Work out if a business opportunity pays back
• Calculate return on the investment
• Understand the time value of money
• Use established Investment Appraisal' techniques
• Build a financially sound business plan

Unit 7: Measure The Performance of The Business:

• Understand what constitutes success
• Analyze return on investment
• Analyze short term solvency
• Analyze gearing ratios
• Analyze measures investor ratios
• Be aware of the drawbacks of performance measures