Course description
Many roles now require the individual to be financially competent, even when they have no background or experience in accounting. Spread over 2 x 6 hour sessions, this live and interactive online course is designed to provide the skills to achieve this expectation and enable you to deal effectively with colleagues in finance and accounting. The sessions will also improve your overall commercial awareness and skills.
Join expert speaker David Potts in our virtual classroom as he discusses how accounts are put together (from initial reporting to final published accounts), how profit is reported, the different measures of profit, the difference between an asset and an expense, profit margins and the basics of costing a contract, how to read a balance sheet, how to prepare a cash flow statement, project appraisal techniques, risk management, and much more.
Upcoming start dates
Outcome / Qualification etc.
Training Course Content
Introduction
Many jobs and commercial roles now require the individual to be financially confident and competent, even when they may have no background or experience in accounting.
Spread over two days (2 x 6 hours), this virtual classroom session is designed to provide the knowledge and skills necessary to achieve this expectation and to enable you to be able to deal effectively with colleagues in finance and accounting.
The sessions will also increase and improve your overall commercial awareness and skills.
What You Will Learn
The live and interactive broadcast course will cover the following:
Part 1 - Understanding financial information
Session 1 - fundamentals of financial reporting
- Course objectives - to provide the technical skill and knowledge for commercial managers to be better able to deal with all aspects of financial management in their work
- The key components of accounts - income, expenses, assets, liabilities and equity
- An introduction to the primary financial reporting statements and the key financial performance indicators:
- Net income - measures of profit
- Balance sheet - capital employed and leverage
- Fundamental accounting concepts - accruals v cash based accounting
- Financial records - how the double entry bookkeeping process works - with practical example
- Exercise - case study to identify the key measures of strong financial performance
Session 2 - understanding profit and loss/ net income
- The financial reporting period and the importance of cut-off
- Reporting revenue and key principles for revenue recognition
- Difference between assets and expenses and borderline issues such as R&D
- Expense categories - direct and overheads
- Non-recurring exceptional items
- Exercise - profit and loss appraisal exercise including calculation of gross and net margins and EBITDA
Session 3 - cash flow v profit and loss
- What is meant by ‘cash’ and the importance of positive operating cash flows
- Accruals compared with cash accounting with examples including credit sales and purchases and accruals and prepayments
- Other non-cash items such as provisions and depreciation
- Exercise - Converting cash profit to accruals profit
Session 4 - An introduction to the balance sheet
- The purpose of the balance sheet - creditor protection and the impact on reporting assets and liabilities
- Non-current assets and depreciation (amortisation)
- The net current position - working capital and the assessment of liquidity
- Financial leverage and the concept of the ‘cost of capital’
- Exercise - appraisal of a simple balance sheet - net current position, return on capital and gearing
Part 2 - Applying and using financial knowledge
Session 5 - Management of working capital
- Introduction and overview - what is meant by the working capital cycle
- Managing inventory - stock holding periods and the concept of effective inventory re-ordering
- Management of receivables - the impact of slow or non-payment
- Management of supplier payment terms (as part of overall working capital management)
- Exercise - case study including calculation of stock holding period, debtor and creditor days and the overall working capital obligation of the business.
Session 6 - Budgeting and cost control
- The key elements of the budgeting process
- The budget in context
- How a budget fits with the business strategy and plans
- Agreeing the scope and purpose of the budget
- Understanding costs and the relationship between costs and business activities
- Types of cost - fixed, variable and sunk costs for example
- Costing techniques such as marginal and absorption costing
- The human element to budgeting
- Different types of budget that can be used
- Assessing the impact of the person - what is a reasonable budget expectation?
- How to manage a budget
- The need for accurate and timely management information
- Variance and look back analysis
- Exercise - Creating a budget for an activity and then performing a look back review
Session 7 - Ratio and performance analysis
- Summary and recap of analysis measures available
- The regulatory status of performance ratios such as EBITDA
- Profitability measures used
- How to measure liquidity, solvency and return on investments
- Exercise - case study applying ratio analysis to different types of business
Session 8 - Course summary
- Some other issues to consider:
- Project appraisal - Net Present Value techniques
- Risk management - how to manage financial risks such as interest rates, foreign currency and market fair values
- Plenary session - your financial questions answered (if we have not already done so)
The course timings will also allow for short breaks of about 15 minutes in all 8 sessions.
Expenses
MBL Seminars Limited
MBL is a leading learning and development provider for professional service firms. Over the past 18 years, more than 198,000 people across 23,000 different organisations spanning 81 countries, have chosen us to deliver their training. With over 800 expert speakers...