Course : Financial Modeling

Course Content

Financial Reporting and Corporate Governance

• Business objectives and shareholder wealth
• The users of financial information
• The role of accounting in financial reporting
• Key financial statements, their nature and purpose
• The conceptual framework of accounting and financial reporting
• Introduction to accounting standards
• The development of accounting standards
• International financial scandals
• The agency problem
• The role of audit
• The need for corporate governance
• Corporate governance in the UK, US, and in GCC countries
• The Balance Sheet
• Shareholders equity
• Current and non-current assets
• Current and non-current liabilities
• Working capital
• Preparing the balance sheet
• What does the balance sheet tell us?
• What are its limitations?
• Accounting terminology

Accounting Systems, Reporting and Decisions

• Preparation of the Income Statement
• Calculation of profit
• HCategories of income and expenditure
• Valuation of current and non-current assets
• The format of the Income Statement and Balance Sheet
• The link between cash and profit
• The link between asset valuation and profit
• Inventory, receivables, payables, and cash
• The application of judgement
• The nature and purpose of working capital
• Management accounting and cost-volume-profit (CVP) analysis
• Break even analysis
• The impact of volume and sales changes on cost structures
• The limitations of break-even analysis

Cash Flow and Investment Appraisal

• The purpose of the Cash Flow Statement, and its contents
• The preparation and presentation of the Cash Flow Statement
• Sources and uses of cash
• The link between the Cash Flow Statement, the Balance Sheet, and the Income Statement
• The Cash Flow Statement as a predictor of future performance
• Interest rates and the time value of money
• Discounting and compounding - present values and future values
• Annuities and perpetuities
• Investment appraisal: what is an investment?
• Appraisal techniques NPV and IRR
• Relevant cash flows and free cash flows
• The effect of inflation
• Dealing with risk and uncertainty
• Asset replacement and annual equivalent value
• Capital rationing
• Managing the investment project

Financing and Cost of Capital

• Financing the business
• Financing principles
• Sources and types of finance, and the effect of gearing
• Defensive, neutral, aggressive financing policies
• Stock Market listing
• The Cost of Capital
• Cost of equity (Ke)
• Cost of debt (Kd)
• Weighted average cost of capital (WACC)
• Capital Asset Pricing Model (CAPM)
• The need for company valuations
• Valuation methods: Net assets; PE Ratio; Dividend growth model; Present value of future free cashflows; Capitalised earnings
• Shareholder value added
• Financial growth modelling: analysis of growth patterns
• Use of Excel for growth forecasting
• DCF valuation

Analysis and Interpretation of Financial Reports

• The contents of the published annual report
• Recent developments in financial reporting
• Interpretation of financial statements
• Common size analysis
• Ratio analysis, including the Dupont system
• Profitability ratios
• Liquidity ratios
• Efficiency ratios
• Capital structure ratios
• Investment performance ratios
• Measuring performance – cash ratios or profit ratios?
• Value Added analysis
• Segmental analysis
• The shortcomings of financial statements, for interpretation purposes
• Predicting corporate failure
• Non-financial factors
• General financial management issues
• The effect of poor liquidity
• Post balance sheet events and contingencies
• The auditors report
• Failure-predicting ratios
• Multivariate failure predicting models – Altman Z score
• Integrated financial accounting case study

The Scandinavian Academy for Training and Development adopts the latest scientific and professional methodologies in training and human resource development, aiming to enhance the efficiency of individuals and organizations. Training programs are delivered through a comprehensive approach that includes:

• Theoretical lectures supported by PowerPoint presentations and visual materials (videos and short films).
• Scientific evaluation of participants before and after the program to measure progress and knowledge acquisition.
• Brainstorming sessions and practical role-playing to simulate real-life scenarios.
• Case studies tailored to align with the training content and participants work nature.
• Assessment tests conducted at the end of the program to evaluate the achievement of training objectives.

Each participant receives the training material (both theoretical and practical) in printed form and saved on a CD or flash drive. Detailed reports, including attendance records, final results, and overall program evaluations, are also provided.

Training materials are prepared professionally by a team of experts and specialists in various fields. At the end of the program, participants are awarded a professional attendance certificate, signed and accredited by the Scandinavian Academy for Training and Development.

Program Timings:

• 9:00 AM to 2:00 PM in Arab cities.
• 10:00 AM to 3:00 PM in European and Asian cities.

The program includes:

• A daily buffet provided during the sessions to ensure participants comfort.

Course Objectives:

• Use core financial modeling techniques
• Forecast investments, and calculate valuations of projects and companies in an effective manner
• Develop comprehensive financial models to support investments decisions
• Understand the different financial statement types and their key line items.
• Recognize the importance control accounts play in balancing the model.
• How to model revenue and working capital adjustments.
• Highlight the differences between the four different input methods.
• How to calculate tax components including tax expense, depreciation and losses.
• How to calculate Net Operating Cash flow using the Indirect Cash flow method.

The Scandinavian Academy for Training and Development is committed to hosting all training programs in dedicated and well-equipped hotel facilities specifically designed for conducting and delivering training sessions, unless explicitly stated otherwise on our website. Participants will be notified of the program venue within 7 to 21 days prior to the programs start date, based on the Academys assessment and the programs circumstances. The Scandinavian Academy for Training and Development emphasizes that it holds no responsibility for any force majeure events that may prevent the program from being held at the designated venue. Nevertheless, the Scandinavian Academy for Training and Development will make every effort to provide suitable alternatives and extend the necessary support to participants in the event of a venue change due to unforeseen circumstances.