Comprehensive course analysis
About the course
Learn the fundamentals of finance and accounting
This program provides attendees with an understanding of financial operations within the corporate environment. Participants will learn the value-add techniques used by finance managers to apply across all areas of the firm building more effective decision-making and enhancing enterprise value. The program also covers corporate valuation methodologies and the differences between equity and enterprise values.
This program focuses on understanding these valuation methods; their uses and pitfalls, as well as circumstances where each approach should be used, and which inputs have the largest impact on the output. A limited set of Excel exercises are used to demonstrate principles with an emphasis on understanding rather than rote memorization of modelling with Excel. These approaches help to identify a company’s fundamental value.
Day 1 - Morning
Financial Statements – an Intuitive Approach – Financial vs Managerial Accounting
Rather than drill down into the details of how to develop accounting statements, this module reviews a company as a nexus of contracts of various counterparties. This approach looks at the various stakeholders of a company and what role they play in each part of the balance sheet as well as their claims on the cash flows. It better illustrates the concept of risk/return and where a company should focus their efforts.
- A company as a nexus of contracts among stakeholders
- Left and right hand sides of the Balance Sheet – what is really there?
- Financial structure – claims from the left hand side
- Accounting for cash flows
This module focuses on an intuitive understanding of accounting to get participants to look at the big picture of company value rather than a series of accounting entries.
Day 1 - Afternoon
Analysis of Key Financial Statements
This section provides a formal review of the accounting data and provides analytical tools that allow participants to gain new insights and perspectives into the data. The concept of accrual vs cash accounting is covered to focus on the difference between financial and managerial accounting.
- Review of the accounting cycle
- Income statement to Cash flows
- Cash flow analysis
- Ratio analysis – times series and cross-sectional
This module focuses on using analytical methods to enhance usage and understanding of accounting data.
Working Capital and Capital Budgeting
This section a brief review of working capital and then moves on to capital budgeting and accept vs reject decisions in project management. IRR, NPV and payback models are reviewed along with understanding cash flows for projects.
- Defining working capital and working capital management
- Trade-offs involved with inventory and other assets that use cash
- Using NPV, IRR and Payback Models
- Determining relevant cash flows to make better project decisions.
Participants will be able to model project cash flows and determine accept vs reject criteria for capital budgeting.
Day 2 - Morning
Quick Development of Three Statement Models
Three statement modeling can entail extensive amounts of time and require significant effort. The approach used here is to look at the most useful excel functions and a flow chart approach to efficient model construction.
- Excel tips and tricks
- The most useful shortcuts in Excel
- Using Excel visually; conditional formatting
- Using excel efficiently in model construction
- How the flow of financial elements is used in three statement modelling
Participants will be able to do quick and fast three statement models as well understand proper development of more complex models with iteration and nuances surrounding dealing with controlling interests and other issues.
Principals Behind Valuation
This section provides a primer on understanding corporate valuation and the role in financial transactions.
- The importance of valuation in investment banking and financial transactions
- The role of market values in reliability “trust market prices”
- What determines the price of a transaction
- Looking at Book Values and Market Values – The purpose of each value
- What is fundamental valuation?
Participants will better comprehend why valuation is important and what can be done to generate reliable values.
Day 2 - Afternoon
Understanding the True Nature of Enterprise Value
This module reviews enterprise value determination, proper approaches to its determination and uses of the value.
- Enterprise Value from fundamental Analysis
- Enterprise Value from market values
- Basic calculations of EV – debt plus equity
- What components belong in an EV calculation?
- Why do I exclude some data?
Participants will be able to understand the fallacies surrounding enterprise value and what the true nature of the value provides.
Dr. Holder has designed and carried out an extensive array of training programs for a wide range of clients, from Global IBs, hedge funds, asset managers to exchanges and private wealth managers. His experience in derivative product design, structured product pricing, economics, and business deve...
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