Kaplan

Introduction

In credit evaluation, potential or existing borrowers provide us with their financial statements that effectively report on the financial effects of transactions affecting a business. It is critical for credit officers to distinguish the difference between financial reporting and financial analysis. In Financial Analysis, lenders must have the competency to analyse in such a manner that an integrated understanding of the financial statements is attained to enable financial risks to be identified. This is particularly important in the wake of frequent and expected practice of window dressing.

This 3-day programme will sharpen participants' ability to identify the true and value of a company's assets as well as detect camouflaged activities in financial reports. There will also be emphasis on how to integrate all the financial statements to effectively assess the financial health of the company in the areas of financial stability, operating performance and cash flow position.

Learning Outcomes

At the end of the programme, participants should be able to:

 

• Appreciate the integrated nature of financial statements
• Effectively assess the balance sheet, profit & loss & cash flow statements of a business entities
• Apply the characteristic of good financial analysis
• Assess critically the financial aspects of a business with the use of ratios
• Understand some basic creative accounting practices
• Understand the dynamics affecting a business’ profitability

Who Should Attend

• Relationship Officers/Managers
• Account Officers/Managers
• Credit Officers/Managers
• Credit Support Officers/Managers
• Any officer who needs some appreciation in assessing the financial aspects of a company

Pre-Requsite(s)

• Delegates should have some basic understanding of financial statements and accounting
• Delegates are required to bring along a financial calculator for this course

Course Outline

Limitations of Financial Statements

Practical Integrated Analysis of Financial Statements

 

• Relating business cycles with financial statements
• Financial stability of business - Balance sheet
  - Asset consistency
  - Business solvency
  - Risks of gearing or size of debt
  - A realistic capital structure
  - Funding stability
• Earning capacity - Profit and loss
  - Quality of earnings
  - Insights to future profitability
• Liquidity - Cash flow statement
  - Identifying sources and applications of cash
  - Understanding the cash flow statement
  - Trouble shooting with cash flow statement
• Relationship between financial statements
• Characteristics of good financial analysis

 

Case study: Cover how a company’s financial statements should be systematically analysed to ensure they are integrated with each other to provide a holistic picture of the company.

 

Critical Assessment of Various Categories of Ratios Used

 

• Liquidity
• Gearing
• Debt service
• Asset management
• Profitability

 

Critical Principles in the Use of Ratios

 

• Ratios are tools
• Ratios provide insights NOT conclusions
• Being creative in use of ratios
• Integrated financial analysis

 

Case study: Will cover how ratios can be effectively used in assessing how a company’s financial aspects are integrated within the business.

 

Creative Accounting

 

• Detecting irregularities
• Checking for camouflaged activities in financial reports

 

Case study: Looking at common creative accounting practices & the accompanying effects with selected examples.

 

Profitability Management

 

• Dynamics affecting the profitability or breakeven of a business
• Effects of changes on a business' profitability
• Quantitative analysis involving breakeven

 

Case study: Will cover how product mix can have a significant impact on a company’s profitability.

 

Course Summary & Conclusion

 

Course Date

1 - 3 September 2010

Trainer

Dr. Johnny Tan / Yap Chee Moon / Pang Chee Seng

Fee

S$2,700.00 (exclusive of GST)