Financial Analysis, Modeling, and Forecasting Techniques

Introduction:

This Financial Analysis, Modeling, and Forecasting course is a highly specialized program designed to empower professionals with advanced analytical skills and forecasting techniques, enabling them to competently address complex financial issues.

For those seeking to deepen their understanding of economic and financial analysis, this course is ideal for enhancing modeling and forecasting abilities through advanced techniques and Excel tools.

A business-oriented approach necessitates a thorough understanding of financial analysis principles. This advanced financial modeling course goes beyond the conventional financial analysis training typically offered.

By integrating core strategies of financial analysis with the user-friendly, powerful applications of Excel, this course enhances shareholder value. By the end of the course, participants will be able to identify and leverage key strategic revenue drivers within a company.

Objectives:

By attending the Financial Analysis, Modeling, and Forecasting course, participants will be able to:

• Develop a realistic financial plan that aligns with strategic objectives.
• Apply advanced techniques in financial analysis, modeling, and forecasting.
• Implement financial concepts such as present and future value, and internal rate of return.
• Define and monitor key performance indicators to effectively manage business operations.
• Construct customized tools to meet the specific needs of their companies.
• Understand the logical steps necessary for designing a structured financial forecasting framework.
• Evaluate and interpret financial data to make informed projections.
• Master concepts of the time value of money and the basics of interest theory.
• Develop an economic and financial value-added model from a shareholder’s perspective.
• Justify the efficiency of capital investments.
• Master Excel tools, including Solver, Goal Seek, and Scenario Manager.
• Create value for shareholders.
• Gain confidence in discussing and formulating financial strategies.

Training Methodology:

• Lectures with audience participation
• Case study exercises
• Modeling exercises
• Small group discussions
• Analysis of actual cases
• Excel-based simulations

Course Outline:

Unit 1: Financial Modelling and Overview of International Business Environment

• Understanding financial teams and models.
• Constructing economic and financial models in 10 steps.
• Using flowcharting to enhance model clarity.
• Exploring strategies and operations in the global business environment.
• Understanding the framework of organizational planning.
• Learning the product/decision/information cycle.
• The purpose of financial evaluation.
• Creating profit through value enhancement.
• Measures of profitability and wealth creation.

Unit 2: Analysis of the Annual Report and Maximizing Shareholder’s Value

• Importance of ratio analysis.
• Key areas in financial analysis.
• Using Excel templates to evaluate liquidity, leverage, and profitability ratios.
• Analyzing accrued accounting ratio results.
• Understanding the “DuPont” formula and its relationship with EVA®.
• Applying the Altman Z-Score in evaluations.
• Using investment interest surveys for financial performance evaluation.
• Investigating shareholder value concepts.
• Determining equity costs.
• Calculating the cost of debt financing, preferred equity, and common equity.
• Computing Weighted Average Cost of Capital (WACC).
• Formulating the EVA© model.
• Examining the impact of WACC on acquisition activities.

Unit 3: The Time Value of Money and Steps in Building Financial Models

• Understanding the time value of money principle.
• Differentiating types of interest calculations.
• Using benchmarks like WACC and ROIC.
• Creating present value, future value, NPV, IRR, and MIRR models in Excel®.
• Applying IRR to capital projects.
• Deciding when to construct financial models.
• Understanding models and shareholder value (EVA®).
• Setting validation parameters for forecasts.
• Specifying time frames for models and forecasts.
• Incorporating risk components into forecasts.
• Recognizing the critical importance of Excel assumptions in forecast models.

Unit 4: Evaluating Capital Project Proposals and Excel Data Management

• Categorizing different types of capital projects.
• Understanding the capital project appraisal framework.
• Identifying cash cycles in initial and follow-on capital projects.
• Setting and adjusting the cost of capital for projects.
• Addressing terminal value in project evaluations.
• Calculating NPV, IRR, and discounted payback using Excel®.
• Preparing financial forecasts.
• Performing pattern recognition on historical data.
• Conducting Excel-based data analysis.
• Assessing the appropriate timing for model changes.
• Evaluating the accuracy of projections.
• Selecting model types and understanding their applicability.

Unit 5: Time Series Analysis and Investment Portfolio Evaluation

• Constructing time series models using various methods.
• Applying exponential smoothing in analysis.
• Accessing time series analysis support.
• Understanding sensitivity analysis.
• Implementing effective "What-If" strategies.
• Using scenarios and goal-seeking features in Excel.
• Assessing risk determinants in securities.
• Graphing portfolio expected return and risk using variance analysis.
• Using T-bills in real options asset pricing models and modern portfolio theory.
• Essentials of portfolio management practice.
• Using E-Views to estimate share beta in capital markets.