Course summary
This course empowers non-financial managers and other professionals with essential financial literacy and decision-making skills. By providing a comprehensive understanding of financial concepts, budgeting techniques, and analytical tools, participants will be better equipped to contribute to their organisation's financial success. Ultimately, this knowledge will enhance their ability to make informed, strategic decisions that positively impact their departments and the overall business.
This one-day course provides an introduction to the concepts underlying external financial accounting and internal management accounting. You will be introduced to the skills necessary to prepare, interpret and analyse financial statements, including balance sheet, profit and loss statements. You will gain an insight into how your business decisions impact the financial reports of your company. We will also cover budgeting, costing and key performance indicators, and clarify the sometimes misunderstood area of accrual accounting.
Aims
This course should enable you to:
- utilise key financial terms and concepts
- analyse three key financial statements – Profit & Loss, Balance Sheet and Cash Flow Statement
- forecast and prepare budgets
- calculate financial ratios for evaluating the health of the organisation
- calculate variances and recommend corrective action for achieving a budget.
Learning outcomes
By the end of this course, you should be able to:
- recognise why accrual accounting is commonly used in business
- appreciate the rationale for depreciation and amortisation of assets
- interpret a Profit and Loss Statement, Balance Sheet and Cash Flow Statement
- assess the financial health of a business using financial ratios
- prepare forecasts and set budgets for sales, costs and expenses using a range of methods
- calculate variances and recommend corrective action for achieving a budget.
Content
Financial terminology and concepts
- Income and expenses
- Assets, liabilities and equity
The basis for accrual accounting
- Accrual accounting versus cash accounting
- End of period recording of accruals and prepayments
Financial management of assets
- Use of depreciation
- Difference between depreciation and amortisation
Financial statements
- Interpretation of P&L, Balance Sheet and Cash Flow Statement
- Calculation of key financial ratios
- Interpretation of the health of a business using financial ratios
Financial forecasting
- Use of history, market conditions and the Delphi method
- Forecasting for sales, costs and expenses
Budgeting
- Budgeting for an organisation
- Defining and budgeting or profit centre, cost centres and for projects
Calculating and acting on variances
- How to calculate a variance
- Correcting for unfavourable variances
- Generating an estimate of likely performance compared to the budget
Who this course is for
Suitable for managers, team leaders, board members or individuals from a non-financial background who wish to develop their competencies for understanding their organisations' financial statements and structures.
Course examples will be provided to cater for attendees from all sectors – commercial, not-for-profit and government, as the course is designed to meet the needs of anyone who needs to interpret financial data in a work or board setting to assist with their decision-making.
This course covers finance terminology, financial statement interpretation (through financial ratio analysis) and provides a high-level overview of budgets/forecasting/variance analysis. It concludes with a capstone activity that integrates financial statements, ratio interpretation and related business decision making. The separate Budgets and Forecasts for Organisations Course dives deeper into budgeting process, forecasting techniques, variance analysis vs budget and updating the rolling forecast ("latest estimate").
Delivery modes
- Face-to-face, presenter-taught workshop
- Online workshop via the platform Zoom
Delivery style
Delivered as an interactive workshop which includes lectures, group exercises and discussion.
Materials
Course materials are shared electronically.
