Introduction:

This seminar brings together important areas of financial management, planning, and control: Financial Analysis, Planning, and Control; Setting & Controlling Budgets. It will help business professionals:

• Plan more effectively for the future

• Use the financial techniques of planning and control

• Improve performance from the use of the tools of financial analysis

• Link planning and budgeting with costing and performance measurement

• Master the skills of budgetary and cost control

Course Objectives of Financial Analysis, Planning & Controlling Budgets

The seminar provides delegates with the knowledge required to find better answers to questions such as:

• Which specific variables, relationships, and trends are likely to be helpful in analyzing problems?

• How reliable are available financial data, and how are uncertainty and risk likely to impact on the outcomes of decisions?

• In economic and financial analysis what are the implications and relative importance of cash flow as distinct from accounting profit?

• What limitations are inherent in financial data and the key financial statements, and how will these affect the financial analysis?

• How important are qualitative judgments in the context of decision-making?

and to focus on key issues such as:

• Understand strategic planning and budgeting.

• Link finance and operations for budgeting purposes and strategy execution

• Learn how to build a comprehensive performance measurement system

• Learn costing and budgeting terminology used in business

• Understand the importance of a well-defined costing and budgeting process

• Understand cost behavior more accurately

• Be able to perform and interpret variance analysis

Training Methodology of Financial Analysis, Planning & Controlling Budgets

The seminar includes numerous practical examples and real-life illustrations, and participative exercises and case studies. It will be presented in a very user-friendly way to suit individuals with varying levels of financial knowledge and experience. Our aim is for this to be an enjoyable learning experience. The training methodology combines presentations, discussions, team exercises, and case studies. Delegates will gain both theoretical and practical knowledge of all the topics covered. The emphasis is on the practical application of the topics and as a result, delegates will return to the workplace with both the ability and the confidence to apply the techniques learned.

All delegates will receive a comprehensive manual of the seminar to take back to the company, which will serve as a useful source of reference in the future. In addition, all delegates will receive a CD containing a soft copy of the manual and additional material such as Excel models used during the seminar.

Organizational Impact of Financial Analysis, Planning & Controlling Budgets

• Recognize the importance of finance as a component of the strategic decision-making process

• Appreciate the significance of the theoretical concepts underlying the use of financial tools in the strategic decision-making process

• Apply the appropriate financial tools in the strategic decision-making process

• Identify the impact of external factors on a company’s strategic financial plans and decision-making

• Organizations should benefit from an increase in the ability of their managers to understand and analyze the key financial statements and anticipate the financial factors that form the basis of strategic decision-making, which should ultimately result in better strategic planning, and improved company performance.

Personal Impact of Financial Analysis, Planning & Controlling Budgets

This seminar will enable delegates to:

• 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 financial issues and financial professionals.

• Have a better understanding of how financial considerations help to support an organizations’ strategic decisions

• Better appreciate how such decisions may affect their own departments or business units, as well as their 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

Course Outlines of Financial Analysis, Planning & Controlling Budgets

Day 1:

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 2:

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 3:

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 4:

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 5:

Valuation and Business Performance

• Managing for 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)

Setting and Controlling Budgets

Day 6:

Strategic and Financial Planning

• Financial vs. managerial accounting

• Exploring the linkages between strategy, budgeting, costing and performance measurement

• Understanding what strategic planning is and why it is important

• Mission; Vision; Strategy; Goals and Objectives

• The outside environment and the internal context: SWOT and PESTEL analysis

• What is happening in your company

• Looking for the drivers of value creation

• Examples and cases

Day 7:

The Framework for Budgeting

• What is a budget - why create a budget?

• The budgeting framework

• Various types of budgets

• The budgeting process and the human side of budgeting

• Sales forecasting and budgeting schedules

• What is the budgeting process in your company?

• Top-down vs. bottom-up budget; incremental vs. zero-based

• Examples of budgetary schedules

Day 8:

Cost Analysis for Budgeting

• What is costing? Defining costs

• Cost behavior – Fixed and variable

• Breakeven models - The Equation Method

• The contribution margin concept

• Direct and indirect costs

• Traditional vs. Activity Based Costing

• Product vs. period costs

• Case study and examples

Day 9:

Budgeting: case study day - Controlling the budget variances

• What is the situation in your organization?

• Is budgeting organized by department and/or projects?

• Budget variance analysis

• Describe the difference between a static budget and a flexible budget

• Compute flexible-budget variances and sales-volume variances

• Explain why standard costs are often used in variance analysis

• Integrate continuous improvement into variance analysis

• Case study, examples and exercises

Day 10:

Beyond Budgeting: Broadening Performance Measurement Systems

• Advantages and disadvantages of budgeting

• How to improve budgeting in your organization

• What next? Beyond the Budget…

• The Balanced Scorecard: linking Strategy to budgeting to Performance Measurement

• Financial perspective, Customer perspective

• Internal Business Process perspective, Learning and growth perspective

• Developing and adapting the scorecard

• Case study illustration