Course Objectives

In recent years there has been a growing recognition that, in the long run, effective management of cash flow is more important than profit. Long-term cash flow is the real value of a business. It has also been recognised that there is significant potential for improved financial performance from the more effective management of working capital – both directly from immediate cash gains and reduced net interest costs, and indirectly through its impact on increased profitability and return on capital employed. A key challenge in achieving these performance improvements results from the fact that actual levels of working capital and delivery of cash flow are effectively determined by the day-to-day actions of a great many managers and staff, which in large corporations often run into tens of thousands.

This highly participative 5-day seminar covers the principles, techniques and skills involved in the effective management of cash flow and working capital in any business, blending a clear theoretical framework with extensive use of real-life examples and case studies.

Key areas covered in this program include:

• Optimising working capital
• Managing accounts receivable
• Managing inventory
• Strategic management of cash & working capital
• Planning, forecasting and monitoring cash and working capital
• Financial modelling tools and techniques for cash and working capital management

By the end of this programme you will be able to:

• Acquire an understanding of the fundamentals of effective management of cash flow, including the optimisation of the level of working capital.
• Develop practical experience of how to manage cash flow and optimise working capital to facilitate such delivery in real life business situations.
• Increase personal financial skill levels
• Develop confidence through understanding the major drivers of successful financial performance.
• Learn a number of technical skills, all of which lead to the ability to calculate the required figures and implement them into value adding business decisions.

Content

DAY 1

Accounting for Cash & Performance

• A Performance Management Model
• The Financial Language
• Accounting Basics
• Cash Flow and Working Capital
• The 3 Key Financial Statements
• Cash Vs Profit
• Using financial statement to manage cash and working capital

DAY 2

Measuring & Improving Performance

• The Impact of Inflation on Financial Performance
• Measuring Performance: Ratios and KPIs
• Benchmarking of Performance
• Ratios for cash and working capital management
• Basics of working capital management
• Credit Risk Management
• Financial modelling for cash and working capital management
• Spreadsheet modelling and tools and approaches

DAY 3

Strategic Cash Management

• Cash & Cost modelling
• The Economic Value Model
• The Time Value of Money and Discounted Cash Flow (DCF)
• The Key Investment Indicators
• Defining the Right Base Case, Sensitivity and Risk Analysis
• Treatment of Working Capital
• Valuing Companies and Acquisitions
• Where Does Net Present Value (NPV) Come From?
• The Drivers of Value
• Learning from Experience and Delivering Project Value

DAY 4

Optimisation of Working Capital

• Optimisation not Minimisation
• Key Issues
• Stock
• Debtors
• Creditors
• Stores
• Settlement Options
• The Cost of Working Capital
• Long term
• Short term
• Practical Examples
• Engaging the Organisation

DAY 5

Final Session

• Course Summary and Checklists
• Cash Budgets & Budgeting
• Financial Skills and Further Development
• Open Forum
• Course Review

Course Target

• Members of the treasury departments of companies within the oil and gas, petrochemical, and other industries who have responsibilities for managing cash flow and working capital.
• Business professionals, strategic and business development planners, and project professionals who wish to refresh their understanding and enhance their skills in managing and improving cash flow and working capital performance.
• Personnel employed in the banking, insurance and the general financial services sector where the management of cash is of prime importance.
• Any operational, engineering, commercial, marketing, technical, or financial personnel whose work impacts on cash flow or working capital, and who wish to develop their expertise in these areas to support their current roles or for career development.