Financial Management Masterclass

This day introduces strategic financial planning concepts, corporate objectives, and the role of financial management in achieving organisational goals. Participants will explore how to prepare financial plans, conduct forecasting, and analyse relationships that support sound decision-making. The topics covered will include:  

• Strategic Planning
• The Objective of the Firm – Meeting Shareholder & Stakeholder Objectives
• Agency Theory – The Relationship between Shareholders & Management
• Creative Accounting and the Case of Enron
• Financial Management & Financial Planning – The Scope, Role & Responsibilities of Financial Management
• Preparing a Financial Plan – The Master Budget
• Forecasting Future Cash-flows and Financial Modelling
• Time Series Analysis, Correlation & Regression

This day focuses on identifying and evaluating sources of finance while understanding the impact of financing decisions on cost of capital and shareholder value. The topics covered will include:

• Sources of Finance – Long Term & Short Term
• Evaluation of the Types of Finance - Equity vs. Debt Finance
• Hybrid Finance & Financial Engineering
• The Dividend Decision
• The Cost of Capital and Weighted Average Cost of Capital (WACC)
• Capital Asset Pricing Model (CAPM)
• Accounting Rate of Return (ARR)
• Net Present Value (NPV), Internal Rate of Return (IRR) Capital Rationing & Payback

This day covers key budget concepts, implementation processes, and performance evaluation techniques that support financial plans. The topics covered will include:

• Definition of Budgets, the Budgetary Process and Budgetary Control
• Types of Budgets-Fixed, Flexible, Incremental and Zero Based
• The Purpose / Benefits & Problems / Limitations of Budgets
• Setting / Implementing Effective Budgets - Eliminating the Problems
• Responsibility Accounting and Absorption Costing
• Activity-Based Budgeting / Costing (ABB, ABC)
• Variance Analysis, Cost Behaviour, Break Even Analysis & Sensitivity / What If Analysis
• What-If Analysis combined with Du-Pont Analysis

This day explores techniques to manage cash flow, optimise working capital, and forecast cash needs to support financial planning. The topics covered will include:  

• Cash vs. Profit & The Cash Conversion Cycle
• Calculating and Managing the Cash flow Cycle
• Cash Flow Ratios
• Working Capital
• The Cost of Maintaining Working Capital
• Maintaining the Optimum Level of Working Capital
• Working Investment Ratios
• Preparing a Monthly Cash Flow Forecast

This day focuses on identifying and managing financial risk using appropriate strategies and techniques to protect company assets and performance. The topics covered will include:

• Risk Management & Types of Risk
• Identifying Risk – SWOT Analysis
• The Major Quantitative & Qualitative Risks Facing Companies
• Establishing a Risk Management Strategy
• Financial Risk Management & Hedging Techniques
• Managing Exchange Rate & Interest Rate Risk
• Derivatives-Forwards, Futures, Options & Swaps
• Risk Management Glossary of Terms

This day introduces financial statements, their structure, purpose, and relevance for organisational decision-making. Participants will explore income statements, balance sheets, cash flow statements, corporate governance, ethics, and CSR reporting.  

• Why analyse financial data?
• Who are the users of Financial Information?
• Sources of Financial Information
• Published Annual Reports and Accounts – What is their purpose?
• The Structure and Contents of an Annual Report and Accounts
• Creative Accounting, Financial Scandals, and the Agency Problem
• Corporate Governance, Sustainability, Ethics and Corporate and Social Responsibility (CSR) Reporting
• The Three Main Financial Statements
  • Income Statement
  • Balance Sheet
  • Statement of Cash Flows

Participants will learn to apply ratio and analytical tools to assess financial position and performance using real-world examples and Excel.  

• Using Ratio and Other Analyses of the Annual Report and Accounts to Assess Financial Position and Financial Performance
• Profitability and Cost-Volume-Profit (CVP) Analysis
• Efficiency and Working Capital
• Liquidity and the Short-term Solvency
• Investment and Growth
• Financial Structure and Long-term Solvency
• Ratio Analysis using Excel
• Excel Trend Analysis using Common-size Horizontal Analysis and Vertical Analysis for Comparability

This day covers advanced analytical techniques to forecast performance, evaluate profitability, and understand cash flow versus profit.  

• The Dupont System of Ratio Analysis and Pyramids of Ratios
• Segmental Analysis and Value Added Analysis of the Annual Report and Accounts
• The Fundamental Statistical Tools and Graphical Representations
• Using Statistical Techniques to Analyse and Forecast Financial Data
• The Impact of Alternative Asset Valuation Methods on the Balance Sheet and Profitability
• Cash flow vs. Profit – The Best Measure of Financial Performance
• Working Capital and the Cash Flow Operating Cycle
• Direct and Indirect Cash Flow Analysis and the Cash Flow Forecast

Participants explore funding sources, capital structure, cost of capital, and valuation techniques to assess investment opportunities.  

• Analysis of the Balance Sheet to Identify Long-term Debt and Equity, and Short-term Financing
• Capital Cost Models: Cost of Equity using Dividend Growth and Capital Asset Pricing Model (CAPM), Cost of Debt
• Weighted Average Cost of Capital (WACC)
• Optimal Capital Structure Models to Minimise WACC
• Future Values, Present Values, and Discounted Cash Flow (DCF)
• Using Net Present Value (NPV), Internal Rate of Return (IRR), Modified Internal Rate of Return (MIRR) and Equivalent Annual Cost (EAC) to Analyse and Evaluate Capital Projects
• The Reasons for Business Valuations
• Business Valuation Models

The final day focuses on risk management, predicting corporate distress, and mitigating business and financial risks.  

• Predicting Financial Distress and Corporate Railure – The Altman Z-score Model
• Risk and Uncertainty
• Risk Analysis using Expected Values, Standard Deviation and Coefficient of Variation
• Sensitivity, Simulation, Scenario and Break-even Analysis Techniques
• The Analytical Tools to Manage Risk
• Systematic Risk, Unsystematic Risk, Business Risk and Financial Risk
• Financial Risk– Interest Rate and Foreign Currency Exchange Rate Exposures
• Using Insurance, Hedging and Derivatives to Mitigate and Minimise risk