Interpreting Accounts and Financial Analysis

This two-day course provides delegates with the core accounting principles they need to be aware of to read a set of accounts effectively. The course covers basic accounting principles and financial analysis skills, explains the real meaning of accounting jargon and how to measure financial performance.

There is also a review of the significance and impact of accounting standards and the change to international accounting standards and the key areas of impact will be discussed.

Course Content:

Day One

The Accounting Foundations - What is Financial Information?
Understanding the basics
Review of financial statements
- Profit and loss account, balance sheet, cash flow
- How they are produced, why are they needed and how they inter-relate, who are they really for?

The Components of a Balance Sheet

Assets and liabilities
Working capital cycle
Sources of capital and funding
What does this tell you about a company

The Components of a Profit and Loss Account

Income and expenses
Why profit does not equal cash
What is EBIT and EBITDA
What does this tell you about a company

Cash Flow Statements

How to read cash flow statements

Case Study
Producing financial statements and understanding the inter-relationship

Day Two

Introduction to Financial Analysis
Measuring financial performance - using the accounts
How ratios can be used effectively to help you understand profitability, liquidity and gearing

Review of Accounting Standards
The impact on the balance sheet and profit and loss account of recent accounting standards and the change to International Financial Reporting Standards
Accounting issues considered
- Historical information vs future
- Accruals and cashflow
- Profit measurement
- Effect of accounting policies
- Creative accounting
- Funding and gearing

- Valuation of assets

"A difficult concept to deliver in two days - communicated brilliantly. Thank you."