Finance For Lawyers

Finance for Lawyers is designed to show you what analysts do. The course is ideal for lawyers and others, who, whilst not working directly in functions requiring a detailed knowledge of finance, need to be: Appraised of the risks that are involved when using financial information; and Familiar with the overall concepts and language used in financial analysis, credit transactions and other corporate finance activities. The course is in the style of an intensive briefing with some case study material added. Delegates will be required to carry out a fair amount of financial manipulation and will be introduced to spreadsheets with a number of simple cases. Delegates should have with them a simple calculator for use in financial analysis cases. A portable computer with spreadsheet software is also useful. For those who have never touched spreadsheets before, this course represents a gentle introduction, and questions are encouraged to ensure delegates develop their knowledge by enquiry. This is a must-attend course for anyone needing to be aware of the risks involved and inherent in the use of financial information. How this course will help you: You will gain a thorough understanding of: Modern financial analysis skills The features of a balance sheet, profit & loss and cash flow statement Financial analysis techniques Global accounting in the new century Cash flow analysis Evaluating capital investment projects The fundamentals of credit analysis
Day 1 09.00 - 09.20 Registration and coffee Developing modern financial analysis skills Session 1: introduction to financial analysis – Differences in UK/US accounting terminology – Identifying the relationship between cash flow and profit – Development of an integrated cash flow model – Recognising it’s all about cash – Understanding the relationships between the three main accounting statements Session 2: fundamentals of accounting statements – The profit and loss account – How the P&L has changed over the last 25 years – Detailed review of the profit and loss account including explanation of all significant accounting terminology – Profit types – trading, asset and business – Inventory, depreciation, capitalised interest, minority interests and consolidation – Exceptional and material items Session 3: fundamentals of accounting statements – The balance sheet – Detailed review of the balance sheet including explanation of all significant accounting terminology – Understanding the fixed assets note, accounting goodwill – what is it? – Liabilities, pension fund accounting – Debt and other liabilities like debt deferred tax, contingent liabilities Session 4: financial analysis techniques – ratio analysis – Objectives of ratio analysis – Developing ratio analysis skills – Defining the twelve key ratios – How much information is there in ratios? – Ratio rules – avoiding errors of principle Session 5 Case study: Ratio calculation – delegates calculate ratios for a leading UK retail group. Delegates consider what ratios do and don’t tell us. Day 2 Cash flow analysis, accounting issues and project analysis Session 1: understanding cash flows – Detailed review of the cash flow statement – Analysing and interpreting cash flows – Summarising cash flows for analysis Case study: Summarising cash flows – delegates summarise cash flows for analysis purposes Session 2: cash flow analysis – Defining free cash flow Case study: Examining patterns of cash flows – delegates match cash flows to sectors Case study: Growth and no-growth cash flows – delegates restate cash flows to improve their understanding of performance Session 3 Case study: Delegates summarise and evaluate the cash flows of this distressed British conglomerate Session 4: accounting abuses and update – Abuses of fair accounting – Basic abuses relevant to all businesses – More complex abuses relevant to larger groups Session 5 Case study: Airtours/Mytravel Delegates examine and evaluate the P&L of this major UK based travel group Session 6: evaluating capital investment projects – Introduction to capital budgeting – Discounted cash flow techniques – Calculating the internal rate of return Case study: Speculative housing project Delegates perform investment appraisals to decide whether to proceed with a capital investment Session 7 Case study: Eight Projects Delegates evaluate a number of projects and decide which projects should be pursued and which rejected. Day 3 Credit analysis and strategy analysis Session 1: overview of global accounting in the new century – The history of international accounting – Current international accounting approaches – The major issues in international accounting – The implications of the IAS initiative – Currently contentious accounting issues Session 2: funding structures – The relationship between business risk and financial risk – The four phases of the corporate life-cycle – Identifying appropriate funding structures – Recognising the drivers of funding strategies Session 3: credit analysis - the basic concepts – Introducing credit analysis frameworks – Financial analysis and review of the issues – Non-financial analysis – developing a framework Session 4: economic and country risk – Understanding the indicators and signals – Implications of macro-economic change for investors, banks and businesses Session 5: overview of non-financial analysis – Strategy analysis – what is strategy/business risk? – Overview of strategy terminology and concepts Session 6: techniques for corporate assessment – A pyramid model for strategy evaluation – SWOT/Environmental analysis – Porters five forces – Boston portfolio matrix – Environments matrix – Exercises - Strategy evaluation techniques multiple choice Session 7: mini case studies – strategy analysis Mini case study: Major airline strategy change Mini case study: Major private equity transaction in the packaging industry