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Cash and Liquidity Management
Mastering Cash Management: Navigating Working Capital Dynamics and Forecasting Cash Flows

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4.9
English
Intermediate
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Course Overview

Cash management or the management of an entitys liquidity, requires an understanding of the assets and liabilities that directly affect the flow of cash resources. Cash forms part of the working capital of an entity, and all the elements of the working capital have a direct influence on the cash flows.
During this course, we will discuss the major elements of working capital and their impact on the cash resources of the entity. We will also analyse the efficiency of an entity at managing their working capital and sources/uses of cash resources. Finally, we will look at ways of forecasting the cash flows of an entity. At the end of the course, there will be an exam and upon successful achievement of the pass mark, a certificate will be issued and the successful participants will also receive NASBA CPE credits.

Key Takeaways

1
Understand the impact of accounting transactions on profits and cash resources.
2
Understand what is working capital and its impact on funding requirements.
3
Analyze liquidity and working capital efficiency.
4
Quantify the impact of various financing options on current and future cash flows.
5
Analyze liquidity and solvency of an entity.

National Association of State Boards of Accountancy
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LEORON Professional Development Institute DMCC is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.NASBARegistry.org

Course Outline

Day 1
An introduction to financial accounting
→ What is financial accounting?
→ The accounting equation
→ Assets and liabilities
→ Current vs Non-Current
→ The relationship with profits and cash resources
Case study: The participants will be required to allocate the values of a number of transactions to different categories of asset, liabilities, income or expenses, and also state the impact on cash resources.
What is working capital and why is it important?
→ Definition of working capital and operating working capital
→ The working capital cycle
→ The difference between positive and negative working capital
→ The impact on business and funding requirement
Case study: The participants will be required to calculate the working capital and operating working capital of a company based on the information provided and discuss the funding requirements related to this level of working capital.
Working Capital Management
→ Working capital efficiency ratios
→ Monitoring of efficiency ratios for performance analysis
→ Cost-benefit analysis for working capital management
Case study: The participants will be required to analyse a company’s working capital efficiency and present a report about their findings. It will be useful if they also compare against the industry and competitors.
Day 2
Inventory
→ The different types of inventory
→ Issues related to costing of inventory
→ Inventory costing methods
→ Impairment of inventory
• Obsolescence and other issues with inventory valuation
→ The impact of inventory valuation on profits and cash forecasts
→ Inventory management techniques
• Economic Order Quantity (EOQ)
• Just in time (JIT)
Case study: The participants will be required to calculate the future cash impact of inventory purchases based on predictions, calculate the impact of changing the costing method on current profits, and the potential future cash impact of inventory impairment. They may use Microsoft Excel.
Accounts payable
→ What is included in accounts payable?
→ Trade payables
→ Other payables and reserves
→ Accounts payable as a source of finance?
→ Payables management techniques
• Supply chain financing
• Payment management options
Case study: The participants will be required to prepare a monthly schedule of payables payments over a period of time, to determine the company’s cash flow requirements. They will also need to discuss any options available to delay the cash outflow and improve short term liquidity. They may use Microsoft Excel.
Day 3
Accounts receivable
→ What is included in accounts receivable?
→ Trade receivables
→ Credit control procedures
→ Provision for doubtful debts
→ Other receivables
→ Monetising your trade receivables
• Invoice discounting and factoring
• Settlement discounts and the real cost of funding
• Receipts management options
Case study: The participants will be required to prepare a monthly schedule of expected receivables collections, to determine the company’s cash inflows. They will also need to discuss the options available to speed up the collections and improve short term liquidity. They may use Microsoft Excel.
Short term sources of finance
→ Bank overdrafts and revolving credit facilities
→ Short term portion of loans
→ Other short term financing options
Case study: The participants will be required to quantify the immediate and future impact on cash resources of a number of short term financing transactions. They will also need to discuss any alternative options and whether they would be preferable to the ones presented. They may use Microsoft Excel.
Day 4
Cash Flow analysis
→ Understanding the Cash Flow Statement
→ Liquidity ratios
→ Solvency ratios and impact of debt covenants
Case study: The participants will be required to assess the liquidity of a company based on its annual financial statements and give suggestions as to how to improve it.
Cash management
→ Operating cash balances
→ What are cash equivalents?
→ Types of cash investments
• Interest-bearing deposits
• Short term treasury bills
• Other securities
→ Principles of short term investments
→ Cash management options
Case study: The participants will be required to analyse various short term investment options and make a recommendation as to which to invest in and for how long. This should be supported by a presentation of the current and future cash impact of each option, and the annualised return on investment for each option. They may use Microsoft Excel.
Non-current assets
→ Types of non-current assets
→ Depreciation and amortisation
→ Impact on cash flow
Case study: The participants will be required to prepare a schedule of the funding requirements related to non-current assets. They may use Microsoft Excel.
Day 5
Non-current liabilities
→ Types of non-current liabilities
→ Amortising debt and interest impact
→ Debt waterfall
Case study: The participants will be required to prepare a debt amortisation schedule and debt waterfall to determine the cash flow requirements for debt servicing. They may use Microsoft Excel.
Cash flow forecasting
→ Why the need for a cash flow forecast?
→ The difference between the Cash Flow Statement and a cash flow forecast
→ The sources of funds
→ The uses of funds
→ Minimum cash balances
Case study: The participants will be required to create a cash flow forecast based on the information provided. They may use Microsoft Excel.

Who Should Attend?

This highly practical and interactive course has been specifically designed for
This program is designed for delegates who wish to understand how to manage cash resources by managing working capital. It would benefit both individuals without previous knowledge of financial accounting and those who have some experience, as there is a focus on the impact on cash resources. However, no previous knowledge of financial accounting is required, as we will cover the basics before going into more detail. Individuals in the following job descriptions, as well as those with an interest in cash management, would benefit from this course:
→ Management accountants
→ Financial accountants
→ Financial analysts
→ Finance managers
→ Corporate accountants
→ Financial controllers
→ Budget and forecasting controllers
→ Financial planning and analysis managers

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FAQ

What language will the course be taught in and what level of English do I need to take part in an LEORON training program?
Most of our public courses are delivered in English language. You need to be proficient in English to be able to fully participate in the workshop and network with other delegates. For in-house courses we have the capability to train in Arabic, Dutch, German and Portuguese.
Are LEORON Public courses certified by an official body/organization?
LEORON Institute partners with 20+ international bodies and associations.We also award continuing professional development credits (CPE/PDUs) for:1. NASBA (National Association of State Boards of Accountancy) 2. Project Management Institute PDUs 3. CISI credits 4. GARP credits 5. HRCI recertification credits 6. SHRM recertification credits
What is the deadline for registering to a public course?
The deadline to register for a public course is 14 days before the course starts. Kindly note that occasionally we do accept late registrations as well, but this needs to be confirmed with the project manager of the training program or with our registration desk that can be reached at +91 4 95 5711 or [email protected].
What does the course fee cover?
The course fee covers a premium training experience in a 5-star hotel, learning materials, lunches & refreshments, and for some courses, the certification fee and membership with the accrediting bodies.
Does LEORON give discounts?
Yes, we can provide discounts for group bookings. If you would like to discuss a discount on a corporate level, we will be happy to talk to you.

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