Reporting and Budgeting – Level 1

Managers and executives from all sectors who input into strategic and financial planning for their organisation, including those:

• Newly appointed into a strategic planning role
• Treasury department managers who wish to increase the strategic role of the treasury function
• Financial planning practitioners who want to update their skills
• Managers who want to review their organisation’s performance
• Budget holders who want to identify trends in expenditure
• Operations managers who want to know more about how they compare with competitors
• Senior managers who require greater financial literacy skills
• Managers facing financial decisions or contribute to a wider planning process

• Go beyond the description of financial performance to calculate and interpret key information
• Interpret trends shown in each financial statement
• Comment on their own and competitor’s liquidity, efficiency and funding
• Assess the influential role of all stakeholders
• Develop a business funding policy to manage financial risk
• Evaluate the growing influence of corporate finance on strategy
• Exploit the growing strategic role in developing competitive advantage

Interpreting Financial Statements

• The income statement (P & L) statement, format, content and key concepts
• Interpretation of key ratios derived from the income statement; P/E ratio, Profit margin
• The language and major components of the balance sheet
• Business ratios derived from the balance sheet and P & L together, liquidity, debt, profitability etc

Investment Appraisal

• Defining the value generated and the required return – the hurdle rate
• Return on capital employed – calculation methodology and interpretation
• Payback period calculations
• NPV and IRR calculations
• Non-financial aspects of investment appraisal and decision making

Essential Budgeting Process

• Purpose and benefits, problems and limitations of capital and operational budgets and the important differences
• Budget processes in the private sector
• Budget processes in the public sector
• Identification of risks to the budget and actions to mitigate them

Measuring Financial Statements

• What is financial performance?
• Financial performance in the public sector
• The importance of cash flow – how to measure and improve it
• Gross profit, operating profit, net profit margin
• Key performance ratios