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 Advanced Cash Flow amp Working Capital Management F156 QR Code
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Advanced Cash Flow & Working Capital Management



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 recognized 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.

Course Objectives:

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

  • Understand the fundamentals of effective management of cash flow, including the optimization of the level of working capital.
  • Develop practical experience of how to manage cash flow and optimize 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 many technical skills, all of which lead to the ability to calculate the required figures and implement them into value-adding business decisions.
  • Understand balance sheets and profit-and-loss statements
  • Understand the importance of cash as the lifeblood of a business
  • Focus on key management areas of inventory accounts receivable, and accounts payable
  • Understand how to control and manage the cash flow of a business
  • Forecast cash flows and draft a cash budget
  • Evaluate projects based on their expected cash flows
  • Incorporate risk into financial decisions

Targeted Audience:

  • Treasury Team Members
  • Commercial Managers
  • Receivables and Payables Team Members
  • Planning and Budgeting Managers
  • Financial and Management Accountants
  • Capital Investment and Project Management Team Members

Course Outlines:

Unit 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

Unit 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 modeling for cash and working capital management
  • Spreadsheet modeling and tools and approaches

Unit 3: Strategic Cash Management:

  • Cash & Cost modeling
  • 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

Unit 4: Optimisation of Working Capital:

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

Unit 5: Cash Flow Planning and Forecasting:

  • Approaches to managing cash resources
  • Cash flow forecasting methods
  • An integrated approach to risk management
  • Techniques for managing risk
  • Building a key driver cash flow forecast
  • Sensitivity testing cash flow forecasts

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