Unit 1 : Accounting: An Introduction

• What is accounting?
• What forms can accounting take?
• Definition and importance of profit.
• Decision scenarios explored.
• Funding business operations.
• Who is interested in profit?
• Cash vs. accrual accounting.
• Cash flow forecasting and improvement.
• Companies choose accounting policies.
• Accounting standards.

Unit 2 : Financial Statements, Accounting Policies, and Reporting Standards

Income Statement – Basic Components:

• Revenues and the questions.
• Direct/variable/product costs.
• Indirect/fixed/period costs.
• Mixed costs.
• Non-cash deductions: the what, the why, and the how.
• Depreciation: various methods explored.
• Amortization: impairment test.
• Depletion: when and how.
• The difference between profit and cash.
• A closer look at costs and expenses.
• Profit calculations.
• Summarizing profit statements and extracting the key figures.

Balance Sheet :

• Assets – current and long-term.
• Liabilities – current and long-term.
• Equity – components.
• Capital employed – options.
• Managing the working capital cycle.

Cash Flow Statement :

• Operating sources/uses.
• Investing sources/uses.
• Financing sources/uses.

Unit 3 : Making and Communicating Decisions Using Budgets

• The master budget.
• Budgeting is a planning tool, a control mechanism, a communications device, and value creation.
• Budgeting Sales to \”drive\” the correct budget.
• Operating budget components.
• Financial budget.
• Pro forma financial statements.
• Cash budgets.
• Capital budget.
• Interrelationship of financial projections.
• Dynamics and growth of the business system – a model review.
• Flexible vs. traditional budgets – the pros and cons.
• Variance analysis as a tool for improvement and communications.
• Price and volume effects within variance analysis: State of the art.

Unit 4 : Financial VS Management Accounting

• Differences and similarities.
• Objectives of managerial accounting.
• Managerial versus financial accounting.
• Role of the managerial accountant.
• Financial accounting: what we show to the public.
• Objectives of financial accounting.
• Role of a financial accountant.
• Cost terminology: variable, fixed, controllable, non-controllable, incremental, sunk, opportunity, and relevant.
• Cost behaviors in cost-volume-profit scenarios: contribution margin and fixed costs.
• Breakeven and targeted net income scenarios.
• Cost/benefit analysis.

Unit 5 : Ultimatum Goal of Planning – Valuation, Business Performance and Decision-Making:

• Definitions of value.
• Responsibility centers: cost, profit, and investment.
• Measuring responsibility center performance.
• Segment reporting internally and externally.
• Business Valuation from multiple perspectives.
• Managing for shareholder value.
• Shareholder value creation in perspective.
• Evolution of value-based methodologies in planning and budgeting.
• Creating value in restructuring and combinations beyond planning and reporting- the case for real change!

Unit 6 :  What is Finance and Working Capital – Liquidity or Bankruptcy:

• Finance is a numbers game.
• Yet finance is more than the numbers.
• The three major components of finance.
• Working capital (WC) defined.
• Relationship to current ratio.
• Components of WC.
• Inventory.
• Accounts receivable.
• Cash.
• Accounts payable.
• Notes payable.
• The critical ratios to compute.
• What should they be and why?
• The questions to ask.
• The answers you want.

Unit 7 : Capital Structure – Its Significance and Impact:

• Equity capital – what is it?
• Equity capital – calculating its costs/required rate of return.
• Debt capital – what is it?
• Debt capital – calculating its costs/required rate of return.
• Weighted Cost of Capital (WACC) – why is it so important?
• Calculating your WACC.
• When and how to use WACC?
• Leverage: two-edged sword – defined.
• Operating leverage – calculated.
• Financial leverage – calculated.
• Combined leverage – Wow! Look at the impact.

Unit 8 : CAPEX – Analysis of Investment Decisions with What-if Risks:

• Cash flows and the time value of money.
• Discuss the capital project evaluation process.
• Ideas for the future with a multiple-period horizon.
• Estimating cash flows within the business system.
• Net Present Value (NPV) and Internal Rate of Return (IRR) are preferred methods.
• Profitability Index (PI) and Modified Internal Rate of Return (MIRR) are reasonable alternatives.
• Defining the approval criteria and review process.
• Post-implementation audits of capital projects.
• Refinements of investment analysis.
• Dealing with risk and changing circumstances – how do we explain?
• Cost of capital and return standards.
• Benchmarking discount and hurdle rates.

Unit 9 : Risk Management as an integral part of Corporate Governance:

• Understanding uncertainty and risk/opportunity.
• Identifying strategic financial risks.
• Identifying operational risks.
• Identifying functional financial risks.
• Assessing financial risks in each perspective.
• Finding our risk profile (risk appetite).
• Clarifying desired outcomes, expected outcomes, and actual outcomes.
• Performance measures – the need for FRM/ERM.
• Quantitative and qualitative risks.
• Developing FRM/ERM strategy – do we need a CRO?
• Other risk issues to be concerned with are joint ventures, alliances, product liability, environmental risks, outsourcing risks, growth risks, R&D risks, natural disasters, catastrophic risks, supply chain risks, reputation risks, and psychology of risk.

Unit 10 : Corporate Governance:

• What is corporate governance?
• Corporate governance environment.
• Relevance of corporate governance.
• Perspectives on corporate governance.
• Shareholders vs. stakeholders.
• Voluntary vs. enforcement.
• 1-tier vs. 2-tier boards.
• Chairman/CEO duality.
• The independent director.
• Corporate governance models.
• Structure and practices.
• Emerging trends in corporate governance.
• Principal-agent theory and applications.
• Independence vs. appearance.