Understanding and Analysing Financial Statements

Prepare for your career progression by improving on your finance literacy! This course provides participants with a good grounding of how financial statements are prepared, interpreted and used to extract critical information for business decisions.

Financial statements contain a wealth of information on the performance and health of an organisation.  To harness that information, however, you need to have a sound understanding of the basis upon which financial statements are prepared and the ability to interpret the myriad of data correctly.  This information will be the foundation of the various types of business decisions to be committed.

Understanding and Analysing Financial Statements

Key Facts

  • Duration: 2 days, 10am-5pm (12 hours)
  • Delivery Mode:
    • Live Online
    • On campus (please note our campus is currently closed due to Covid-19)
  • Fees: SGD $1,605

 

  • Every member of the Finance team
  • Managers or executives who want an incisive understanding of working financial knowledge, especially financial statements

Seminar, class participation, printed materials, supplementary readings, and case studies.

A certificate of attendance will be issued to participants who have attended and completed the programme.

Day one

Time Topics
10.00am
  • Types of financial statements and their purpose
  • Statutory financial statements
  • Management financial statement
  • Consolidated Statements
11.30am Break
11.45am
  • Understanding of preparation financial statements and compliance with accounting standards
  • The interpretation of information presented
1.00pm Lunch
2.00pm
  • Assessing financial performance and health
  • Using a case to prepare trend analysis on:
    • Profitability
    • Gearing
    • Efficiency
    • Investment returns
5.00pm End of course for Day 1

Day 2

Time Topics
10.00am Understanding and interpretation of key investment ratios:
  • Return on equity
  • Dividend yield and payout
  • Price-Earnings
  • Net tangible assets
11.30am Break
11.45am
  • Assessing cash flow
  • Differences between profits and cash flow
  • The cash flow statement
1.00pm Lunch
2.00pm
  • Using a case to:
    • Prepare cash flow statement
    • Interpret the cash flow statement
  • Reading the Annual Report
    • Chairman/CEO statement
    • Notes to the accounts
5.00pm End of course

Learning Objectives

This course is designed to cover the main features of the financial statements prepared by business enterprises. Participants will understand the meaning and fundamental structure of the financial statements, and the inter-relationship of the items in the statements. Thereafter, participants will learn to apply key management ratios to evaluate the strengths and weaknesses of the business operations.

  • Gain a comprehensive overview and understand the basis upon which financial statements are prepared.
  • Interpret financial statements correctly for different types of business decisions.
  • Detect symptoms of potential problems from the financial statements and other relevant parts of the Annual Report of a company.
  • Ask the appropriate questions when analysing financial statements.

 

Module Contents

Types of Financial Statements

  • Corporate accounts, including consolidated accounts, management accounts


Understanding How Financial Statements Are Prepared

  • Balance sheet / Statement of Financial Position
  • Profit & Loss Statement / Income Statement / Income & Expenditure Statement
  • Statement of Comprehensive Income
  • Statement of Changes in Equity
  • Differences between accounting profit and cash flow


Assessing Financial Performance & Health

  • Trend analysis
  • Profitability (Profit Margins, Return on Assets)
  • Efficiency (Asset Turn, Fixed Asset Turn, Inventory Turn, Collection Period)
  • Solvency (Financial Gearing, Current Ratio, Interest Cover, Debt Service Cover)


Awareness of Common Investment-related Ratios

  • Return on Equity
  • Impact of financial gearing on Return on Equity
  • Dividend Yield & Dividend Pay-out
  • Price-Earnings ratio, Net Asset Value


Assessing Cash Flow

  • Importance of operating cash flow
  • Interpreting Cash Flow Statement
  • Relevance of Free Cash Flow


Quick Finders in Detecting Risks

  • Key points to look out for in financial statements
  • Relevance of other parts of the Annual Report

Unique features of this training course

  • Ability to apply the key management ratios to evaluate the strengths and weaknesses of the business operations.
  • Limited class size to ensure one to one interaction

Request More Information

Contact a programme advisor by calling
+65 6580 7700

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