Overview:

Introduction:

Today’s business professionals must understand the flow of financial resources. Such an understanding is needed daily; whether it is used to anticipate trends, evaluate company performance, or obtain funding. People from non-financial backgrounds are often called upon to make decisions based on modern financial controls, and they must have the know-how to navigate the financial systems that have a significant impact on their professional responsibilities.

This course designed to provide business professionals with a deeper understanding of corporate finance as practiced by today’s most powerful companies. Designed specifically for non-financial personnel, this intensive seminar approaches the subject of finance as it relates to the corporation as a whole.

Course Objectives:

At the end of this course the participants will be able to:

• Understand the appropriate discount rate to be used in investment appraisal
• Understand the pros and cons of different types of financing
• Recognize the factors must be considered in deciding on a dividend policy
• Learn what is the exact nature and scope of the issue to be analyzed
• Define products are available to manage risk
• Understand why is correlation so important in managing risk
• Understand specific variables, relationships, and trends are likely to help analyze an annual report
• Get the ability to actively participate in financial decision making
• Appreciate the relative merits of varying asset classes.
• Recognize the importance of risk in determining the cost of capital
• Utilize sophisticated investment appraisal techniques
• Appreciate the key items from an annual report and recognition of important ratios and linkages
• Recognize the appropriate tool to manage risk
• Integrate with spreadsheet modeling

Targeted Audience:

• High-Level Managers integral to the decision-making process
• Non-Financial Business Professionals managing who has been promoted to financial positions
• Financial Professionals wanting an update or a “refresher” of their knowledge
• Junior Managers working in the finance area
• People who want to gain great knowledge to improve their career

Course Outlines:

Unit 1: Introduction to the Financial Markets:

• An introduction to the equity markets:
  • IPO
  • Market Indices
  • International Equity Market Links
• An introduction to bond markets
• Long Term versus Short Term
• Treasury versus Corporate
• Types of Bond
• The spot and forward market
• Exchange Rate trends and linkages
• Carry Trades
• Futures
• Options
• An introduction to the FX market
• An introduction to the Derivatives Market
• The link between risk and return

Unit 2: Evaluating Investment Opportunities:

• The Markowitz model of Portfolio Risk
• The Capital Asset Pricing Model
• The time value of money and discounted cash flow techniques
• The Gordon Growth Model
• A practical application of forecasting dividends
• Determining the Cost of Debt
• The Ameritrade Case
• The importance of the cost of capital
• Scenario analysis
• The weighted average cost of capital (WACC)
• A practical application of the IRR approach
• Pitfalls in using the IRR approach
• Investment Appraisal using the Net Present Value approach
• Payback and adjusted Payback
• The Internal Rate of Return (IRR) approach
• Real Options

Unit 3: Annual Report:

• The Balance Sheet
• The Income Statement
• The Cash Flow Statement
• Ratio Analysis
• Forecasting Sales
• The cost of sales approach

Unit 4: The Corporate Financing Decision:

• Financial Leverage
  • Modigliani and Millers Theory of Capital Structure
  • The Risk of Bankruptcy
  • The Optimal Capital Structure
• The Dividend Decision
• The clientele effect
• The taxation effect
• The principal-agent problem
• The market for Corporate Control

Unit 5: Risk Management:

• Hedging Exchange Rate risk using:
  • The forward market
  • The options market
  • Zero cost collars
• Hedging commodity price risk using:
• Options
• Futures