Finance for Non-Financial Directors (Certificate Programme)

Learning Objectives

On completion of this pillar, delegates will be:

• Able to define the financial responsibilities of directors and have the knowledge required for good governance and promotion of shareholder value
• Able to clarify the ingredients of financial strategy
• Familiar with the major statutory financial statements.
• Able to assess the financial strength of a company in a structured way using typical financial ratios
• Able to differentiate between management and financial accounting
• Aware of monitoring financial performance and the importance and positioning of Key Performance Indicators (KPI)
• Familiar with the various issues behind funding and the various sources of capital
• Able to appreciate why companies fail

Module Syllabus

Section 1 - Financial Role and Responsibilities of Directors

• Directors Duties, focusing on understanding collective responsibility
• The role of finance in business
• Key financial governance issues
• Introduction to accounting concepts, including the Companies Act and Accounting Standards
• Financial strategy
• Understanding the concept of Shareholder Value
• What to expect from the Finance Director or finance function

Section 2 - Financial Statements

• Accounting Concepts (including Going Concern, Accruals, Prudence and realisation, Consistency, True and Fair/Fairly Present, Valuation)
• The Profit and Loss/Income Statement
• The Balance Sheet
• Cash Flow Statement
• Financial terminology
• The impact of business and strategic decisions on the major statements

Section 3 - Assessing Financial Health

• A framework for financial analysis
• Ratio Analysis
• Cash Flow Ratios
• Creative Accounting – looking behind the figures

Section 4 - Financial Reporting and Management Accounts

• The differences between financial and management accounting
• Budgeting, forecasting and monitoring, with particular reference to financial measurements and Key Performance Indicators (KPIs)
• Break even Analysis
• Costing systems

Section 5 - Sources of Finance

• Why businesses need funding - raising short, medium and long term finance
• Bank finance and managing the bank relationship(s)
• Raising capital from Stock Markets
• Raising Capital from Private Equity providers
• Dividend Policy - What lies behind the dividend decision?

Section 6 - Creating Value

• Cost of Capital
• Project Appraisal Techniques
• Valuations of businesses
• Protection of assets

Section 7 - Corporate Failures

• Causes of corporate failures