This program focuses on the key concepts and techniques of strategic financial management, which has as its key aim the creation of corporate value over the long run. Financial management relies crucially on two principal activities which are extensively examined in the program: one is the investment decision, that is, putting productive assets on the balance sheet; and two, the financing decision, which is concerned with optimal capital structuring on the liability side, that is, the use of debt in relation to equity. This course is crucial for all financial managers who require a rigorous understanding of how corporate value creation is linked to the timing and riskiness of cash flows and the cost of capital. The participant will gain practical insight into the management of working capital, the performance of financial analysis, including an examination of the relevant metrics and value drivers in managing the business, as well as consideration of the sources of long-term financing to the firm. Attention is also given to financial distress and corporate restructuring issues as well as the development of strategic business plans.
An understanding of how the IFRS financial statements are put together and their limitations in business and investment analysis.
A systematic approach of analyzing financial statements and ratio analysis for assessing business and investment opportunities.
Effective use of investment appraisal screening and evaluation tools (payback/ DCF/ IRR/ MIRR).
Broader understanding of current and traditional sources of long-term financing instruments.
Greater insights into using effective advocacy documents to pitch your investment and business conclusions.
Massachusetts Institute of Technology
Massachusetts Institute of Technology — a coeducational, privately endowed research university founded in 1861 — is dedicated to advancing knowledge and educating students in science, technology, and other areas of scholarship that will best serve the nation and the world in the 21st century. Learn more about MIT. Through MITx, the Institute furthers its commitment to improving education worldwide. MITx Courses MITx courses embody the inventiveness, openness, rigor and quality that are hallmarks of MIT, and many use materials developed for MIT residential courses in the Institute's five schools and 33 academic disciplines.
Introduction to corporate finance and capital budgeting
The Quality of Corporate Financial Information and Accounting Concepts → Overview of a typical structure of an annual report and its limitations → Financial accounting standards and audit opinions → The distinction between financial accounting and management accounting → Key components of financial statements • Balance sheet • Income statement • Cash flow statement
Corporate financial decisions
Real options, capital structure, payout policy, corporate bonds; and Interaction between investment and financing decisions
Working Capital and Liquidity Issues
→ Components of working capital and calculations → The link between working capital and financial statements → Management interpretation of ratios as a performance tool → Peer group benchmarking and operational implications → Liquidity measurement / management and free cash flows → The use and abuse of EBITDA → Funding strategies – aggressive or a conservative approach
A Review of Key Financial Ratios and their Analysis
→ Detailed examination of financial ratios linking financial statements and practical realities of the business • Profitability and return ratios • Short term solvency and liquidity ratios • Long term solvency and stability ratios • Information through comparison → DuPont Framework for Assessing Performance • Earnings and efficiency in earnings • Ability to turn assets into profit • Financial leverage • Finding the red flags • Benchmarking - tracking peer performance
Long Run (Strategic) Investment Decisions and Investment Analysis
→ Importance of long-term investment decisions → How can we be sure we are creating value? → The importance of management incentives and agency risks • Return on Investment Return on Capital Employed • Residual Income measures → Developing a conceptual distinction between value creation and destruction → Techniques of screening projects and evaluating investment alternatives → Cash-based versus profit-based assessments -- strengths and weaknesses → How to determine free cash flows and how they are used • Free cash flow to equity and to all capital providers
Investment and Project Analysis Methodologies
→ Capital investment appraisal – relevant costs and discounted cash flows → Evaluating investment alternatives with net present value (NPV) → Understanding the including how to layout the calculations internal rate of return (IRR) method and its cousin, the modified internal rate of return (MIRR) → Other issues relating to investment analysis • Multicurrency cash flows • The role of expected values (EV) in NPV calculations • Applying sensitivity analysis to cash flow models
Determining the Cost of Capital
→ Understanding company cost of capital and relationship to cash flow risks → Demystifying risk betas and the capital asset pricing model (CAPM) • The building blocks of systematic and unsystematic risk • Distinguishing between financial risk and business risk → Developing a weighted average cost of capital (WACC) for a business → Modigliani and Miller’s capital structure theory – the role of debt and taxes → Impact of dividend policy and its relevance to corporate value
→ Corporate Valuations methodologies and Approaches • Earnings, assets and cash-based methods • Dividend valuation model, price/ earnings (PE) and EBITA multiples Valuation of fixed income securities and common stocks Valuation of derivative securities → Options based valuations – more complex valuation exercises
Analyzing and Assessing Different Sources of Finance Evaluating corporate long term funding strategies and sourcing of finance
→ Identifying traditional financing sources and analyzing them → Using quasi debt structures such as convertible loans: pros and cons → Equity finance from public and private markets (venture capital) → Effective use of rights issues directed at current shareholders → Innovative types of financing (crowd funding)
Managing Financial Risks – Risk Mitigation
Risk analysis, the Arbitrage Pricing Theory (APT), and the Efficient Market Hypothesis → Managing interest rate risk Getting liability structure right • Managing assets and liabilities • Transformation of long-term interest rate structure • Mechanism and how to use interest rate swaps → Managing currency risk • Cross currency borrowings • Currency swaps
Looking back at corporate scandals
→ Some celebrated significant scandals • WorldCom • Bernie Madoff • Enron → Discussion and analysis of red flags in Enron’s financial statements Negotiating Financial Difficulties → The challenges of corporate integration and restructuring - the dos and don’ts → Methodology of a financial restructuring → Approach to assess if a reconstruction is viable → The underpinnings of a reconstruction plan Portfolio theory and the Capital Asset Pricing Model (CAPM)
Who Should Attend?
This highly practical and interactive course has been specifically designed for
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.
IAMM Internal Audit Maturity Model
In recognition of their dedication and contribution supporting IKEA Saudi Arabia in arranging training programs during 2017 & 2018, looking forward for more development and exciting effort this year. On behalf of IKEA Saudi Arabia, THANK YOU!
Certified Professional in Quality and Patient Safety
Dating back to 2014, Mobily’s “LEORON” experience has grown from a single collaboration to a long-term partnership. We consider “LEORON” Institute as a strategic partner, whose contribution has been nothing but premium in equipping our staff with field-based knowledge and information. Past three years have resulted with an expanded collaboration with superior customer service and support. Best Regards,
Turki S. Alsahaan
Certified Professional in Quality and Patient Safety
Since the partnership was signed between BAE Systems Saudi Development & Training and LEORON in 2017, we have been working together to offer the Saudi market a complete portfolio of training solutions benefiting from the wide and extensive experience of both parties. Recognizing the great success of this partnership, we are looking for further collaborations in the future that will position both companies as one of the leading training providers in Saudi Arabia. We thank the LEORON team for their full cooperation and continuing support, and look forward to further success together in the years to come.
Certified Professional in Quality and Patient Safety
We have been working with LEORON for the past two years and will be working with them again this upcoming year. The programs they delivered were fruitful and exciting and our organization has received positive feedback from the participants. What our organization aims to do is to provide at no cost training for all the private sector employees so that they may benefit from our offered programs in Innovation and Professional development. Leoron has helped us achieve this goal. We look forward to continuing this service and wish them the best of luck. Regards,