Introduction

This mastering leadership and financial skills seminar brings together two of the most critical areas of financial management: understanding finance to influence strategic decisions and financial analysis, planning, and control.

Course Objectives

By the end of this course, participants will be able to:

• Think and manage strategically and plan more effectively for the future.
• Identify the role of financial management in strategic decision-making.
• Use the financial techniques of planning and control.
• Improve performance from the use of the tools of economic financial analysis.
• Develop business strategies.
• Understand how financial management supports strategic development.
• Broaden their financial knowledge.
• Develop and manage the financial aspects of their role more effectively and enhance their performance.
• Increase their self-confidence in dealing with economic and financial issues and financial professionals.
• Appreciate how such decisions may affect their departments, business units, and companies.
• Acquire the ability, when involved in decisions about investment, operations, or financing, to choose the most appropriate tools from the wide variety of financial techniques available to provide a quantitative analysis.
• Understand the exact nature and scope of the business problems to be analyzed.
• Obtain quick ‘ballpark’ estimates of likely outcomes of decisions.
• Understand the implications and relative importance of cash flow distinct from accounting profit in economic and financial analysis.

Target Audience

This course is designed for:

• Financial analysts.
• Financial controllers.
• Accountants.
• Treasurers.
• Corporate planning professionals.
• Business development professionals.
• Middle and junior management is a valuable element in their career advancement. Targeted Competencies
• Strategic planning and thinking.
• Financial statements.
• Budgeting.
• Financial risk management.
• Business performance management.
• Financial, economic decision-making.
• Investment decision-making.

Course Outline

Day 1: Fundamentals of Strategic Planning

• What is strategy?
• Strategic management.
• Strategic analysis.
• Mission.
• Objectives.
• Strategic decision-making.
• The strategic planning process.
• Environmental analysis.
• Resources analysis.
• Strategic choice and strategic decision-making.
• Strategic implementation.
• Corporate objectives and accountability.
• Forecasting financial data.

Day 2: Fundamentals of Financial Statements

• Financial statements.
• Balance sheet.
• Income statement.
• Alternative asset valuation methods.
• Cash flow statement.
• Standard size (or horizontal) trend analysis of financial statements.
• Vertical trend analysis of financial statements.
• Segmental analysis of financial statements.
• Value-added analysis of financial statements.
• Understanding the cash flow cycle and the operating cycle.
• Break-even and multiple product break-even analysis.

Day 3: Capital Structure and Leverage

• Sources of funds.
• Capital cost models.
• Cost of equity.
• Cost of debt.
• Weighted average cost of capital (WACC).
• Can we determine a company’s optimal capital structure?
• Capital structure models.
• Preparing projections to assess financing needs.

Day 4: Capital Budgeting

• Future values, present values, and DCF.
• Capital budgeting principles.
• Methods of evaluating capital investment projects.
• Accounting rate of return (ARR) and payback.
• Net current value (NPV) versus internal rate of return (IRR).
• How do you choose which method to use?
• Equivalent annual cost (EAC) method.
• Capital budgeting methods.
• Capital asset pricing model (CAPM) versus arbitrage pricing theory (APT).
• Does it make a difference whether we lease or buy?

Day 5: Managing Financial Risks

• The value of perfect information (VOPI)
• Types of risk.
• Risk management principles.
• Talking to your bankers about managing risk.
• How do you develop the tools for your company?
• How to minimize risk?
• Insurance and hedging.
• Interest rate and foreign currency exchange rate risk.

Day 6: The Challenge of Financial Economic Decision-Making

• The practice of financial-economic analysis.
• Corporate value and shareholder value.
• A dynamic perspective of business Benchmarking your own strategic position/competitor analysis.
• The agency problem and corporate governance.
• What information and data to use?
• The nature of financial statements.
• The context of financial analysis and decision-making.

Day 7: Assessment of Business Performance

• Ratio analysis and business performance.
• Management’s point of view.
• Owners’ point of view.
• Lenders’ point of view.
• Ratios as a system – pyramids of ratios.
• Integration of financial performance analysis – the “Dupont” system.
• Economic value added (EVA).
• Predicting financial distress.

Day 8: Projection of Financial Requirements

• Interrelationship of financial projections.
• Operating budgets.
• Standard costing and variance analysis.
• Cash forecasts and cash budgets.
• Sensitivity analysis.
• Dynamics and growth of the business system.
• Operating leverage.
• Financial growth plans.
• Financial modeling.

Day 9: Analysis of Investment Decisions

• Applying time-adjusted measures.
• Net present value (NPV) and internal rate of return (IRR).
• Strategic perspective.
• EVA and NPV.
• Refinements of investment analysis.
• Equivalent annual cost (EAC).
• Modified internal rate of return (MIRR).
• Sensitivity analysis, scenario analysis, simulation, and NPV break-even.
• Dealing with risk and changing circumstances.

Day 10: Valuation and Business Performance

• Managing shareholder value.
• Shareholder value creation in perspective.
• Evolution of value-based methodologies.
• Creating value in restructuring and combinations.
• Financial strategy in acquisitions.
• Business valuation.
• Business restructuring and reorganizations.
• Management buyouts (MBOs) and management buy-ins (MBIs).