A thorough insight into the annual accounts is extremely important in order to decipher the actual state, the results, the creditworthiness, and the price valuation on the markets.
Develop in 2 days these crucial insights
- Develop a systematic approach of analysis with absolute figures and in percentages.
- Make decisions about the creditworthiness, solvency, price valuation, its performance and make comparisons with comparable companies.
- Draw up management recommendations to adjust financial performance, avoid potential risks and increase profits.
- Evaluate the growth of equity compared to (market) expectations.
- Determine how solvent the company is and its debt ratio.
- Analyse the impact of tangible and intangible assets.
- How well is treasury managing liquidity; is there enough working capital and what is the operational efficiency.
- What is the best indicator for profit? The profit for the financial year, EBIT or EBITDA, and what are the differences?
- How much profit evaporates due to interest liabilities?
- Are the operational cash flows growing in line with expectations?
- How much does the company invest in its future?
- How does the company finance itself and what is the reward for the shareholders of the risk taken?
- How to calculate the return on capital and the return on equity.
- What does a downward trend in the return on sales mean?
- How does management see the future performance and growth of the market?
- What are the average market expectations for small, medium, and large companies?
- Where does the company position itself in relation to its competitors?
- Understand why listed companies maintain two sets of accounts.
- Learn the difference between the national accounting practices (GAAP) versus IFRS.
The course and the learning outcome
In these two days we take you through the annual accounts of a listed international company and learn, step by step, the importance of this report and the strengths and weaknesses of the company.
Participants will learn how to read and interpret income statements, balance sheets, and cash flow statements. By understanding these three principal financial reports, you will be able to conduct advanced analysis of your own or an external organisation financial performance. You will also learn the major financial ratios and their application, which reveals the relationships that exist between various items of information within the accounts.
- The nature of financial statements and the accounting methods (GAAP & IFRS)
- How a company's business and financing activities are reflected in its financial statements?
- The components of financial statements, namely the balance sheet, the income statement and the cash flow statement.
- The distinction between cash flow and profits and the importance of the three documents.
- How to use the statements to forecast future performance.
- How to measure operating, investing and financial performance using ratios.
- Analyse the different types of profitability ratios.
- Understand the liquidity and solvency of the organisation.
- Learn how well the operations are efficient.
- Review and interpret the key impacts of the "Notes of the Accounts".
You will be able to appreciate the strategic context behind modern financial statement analysis, gain practical and intuitive insights through accounting analysis into what is going on in the accounts and how to interpret them. Understand through practical financial analysis how to analyse accounts through ratio, cash flow, and liquidity analysis. Develop the ability to look into the future through financial statement forecasting and gain an understanding of how all these pieces of the puzzle fit together.
This course is designed for all professionals directly or indirectly involved with financial reports, analysis and decision making internally or externally. You could be working either as a new recruit or as experienced staff with new responsibilities, wanting to broaden your perspectives by adding the financial statements, ratio analysis and wider management skills.
Course format (Residential and Online)
This course will be taught using a combination of formal instructions, combined with practical and interactive exercises and case studies used to reinforce the concepts taught in each section of the course. Practice-based learning and critical engagement is a key theme through all our courses allowing delegates to acquire the needed skills and techniques to be applied as soon as they are learned and developed.