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Course: Identifying and maximising company profitability - 3 Modules

Identifying and maximising company profitability - 3 Modules

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  • Certificate on Completion
  • Access on Android and iOS App
  • Self-Paced
About this Course

‘Identifying and maximising Company profitability' is a three Module course

  • Module 1 : Has been designed to teach you the essentials for a profitable company, the fundamentals of the Balance Sheet, Income statement and Cash flow and how to determine the cost structure of your products for decision making.

There are 6 videos in this Module -

  • Video 1 - 21 minutes  - Covers the three types of Capital structure and will teach you the 10 areas that are critical for business success
  • Video 2 - 19 minutes  - The Balance sheet capital, assets and Income statement. Teaches you about capital required, investment in Fixed and Current assets and how the assets are used in the Income Statement. I will then take you through a 'craft beer company' to show you how to prepare a time and motion model.
  • Video 3 - 21 minutes - 'craft beer company' - live example of production, revenue and expenditure flow. The transfer of income statement costs and revenue to the balance sheet as well as the cash flow. This section is critical to your understanding and application of cash going in and out of a business. You will learn why 'back-up' capital is essential
  • Video 4 - 31 minutes - Case study on how to determine the fixed and variable costs of a company for decision making purposes. You will learn a simple method of determining the cost of a product for budgeting purposes, cost analysis and profitability assessment
  • Video 5 - 19 minutes  - Cost analysis under Variable costing for a single and a multiple product company. A simple step by step illustration of how Variable costing works. You will learn the simple skill of determining costs that you can put to work in your company right now
  • Video 6 - 24 minutes - Cost analysis under Absorption and Activity Based Costing systems. These two systems are widely used by many companies. You need to know how they work and whether they should be used by your company or not. I will teach you which system to use

You will also receive a set of notes for each of the three modules.

Module 2 runs for 3 hours and is presented in 5 video sessions.

This second Module is an in-depth study on profitability analysis with an emphasis on setting budgets, comparing them to actual results for performance measurement and setting future targets.

I will take you through a multi-product company from budget to actual results and teach you how to determine where the company did well and where it fell short. We will do case studies of 4 different business sectors, identifying the best practice methods of target setting and performance analysis.

I will also teach you how to assess limiting company factors to determine the most profitable product combination. Operating leverage is the measurement of operating risk.

This module will teach you how to calculate operating leverage and assess the risk for a company.

Finally we will deal with strategic planning factors that a company must assess going forward.

Module 3 runs for 3 hours 40 minutes and is presented in 8 video sessions.

The financial statements of a company consist of the Balance sheet, the Income Statement and the Cash-flow statement.

Module 3 will take you through each of the 3 financial statements teaching you how to systematically analyse company information that will give you a complete understanding of the strengths and weaknesses of the operations and the financial risks of any company.

I will also teach you the skills that you require to value a company from a minority and a majority perspective.

Please make use of the notes that I have provided in PDF format.

The first set is on Financial Statement analysis while second set is on Company valuations.

Basic knowledge
  • This course has been designed for Company managers, product managers and accounting staff. A basic understanding of the Balance sheet and Income Statement is required. No formal qualification is required
What you will learn

Module 1

  • A company business model for a production company
  • Cost analysis for single and multiple-product companies
  • Variable, Absorption and ABC costing for decision making

Module 2

  • Maximising product profitability by changing cost and sales variables - graphic illustrations
  • Why contribution is superior to GP %.
  • The cash-flow statement
  • Maximising variable costing profitability
  • Multiple product analysis
  • Limiting factors of production
  • Operating leverage
  • Budgeting and Performance
  • Reconciliation of Budget profit to Actual profit
  • Profitability analysis of 4 different business sectors

Module 3

  • The Business model and Business cycles
  • Operating leverage
  • The fundamentals of Finance and Financial risk
  • Financial Statement analysis
  • The cash flow statement analysis
  • Balance sheet analysis
  • Financial analysis template
  • Company valuations (Free cash flow valuation; Earnings valuation; Dividends valuation)
  • Valuation template
Curriculum
Number of Lectures: 19
Total Duration: 08:49:31
Module 1 - Capital structure and cost analysis
  • Introduction  

    Video 1 - 21 minutes -

    Covers the three types of Capital structure and will teach you the 10 areas that are critical for business success.

  • The Balance sheet capital, assets and Income statement.  

    Video 2 -  19 minutes  - 

    The Balance sheet capital, assets and Income statement. Teaches you about capital required, investment in Fixed and Current assets and how the assets are used in the Income Statement. I will then take you through a 'craft beer company' to show you how to prepare a time and motion model.

  • The transfer of income statement costs and revenue to the Balance sheet  

    Video 3 - 21 minutes -

    'craft beer company' - live example of production, revenue and expenditure flow. The transfer of income statement costs and revenue to the balance sheet as well as the cash flow. This section is critical to your understanding and application of cash going in and out of a business. You will learn why 'back-up' capital is essential.

  • Determination of Fixed and Variable costs  

    Video 4 - 31 minutes -

    Case study on how to determine the fixed and variable costs of a company for decision making purposes. You will learn a simple method of determining the cost of a product for budgeting purposes, cost analysis and profitability assessment.

  • variable costing  

    Video 5 - 19 minutes -

    Cost analysis under Variable costing for a single and a multiple product company. A simple step by step illustration of how Variable costing works. You will learn the simple skill of determining costs that you can put to work in your company right now.

  • Cost analysis under Absorption and Activity Based Costing  

    Video 6  - 24 minutes - 

    Cost analysis under Absorption and Activity Based Costing systems. These two systems are widely used by many companies. You need to know how they work and whether they should be used by your company or not. I will teach you which system to use.

Module 2 - Identifying and Maximising Company profitability
  • The Balance sheet and Income Statement  

    Video 1 teaches you how to analyse costs that will enable you to set budgets and determine break-even point for the company. You will also learn the factors that can be targeted to increase company profits. Next – the difference between Mark-up and GP percentage. Finally - a hands on example to teach you the impact on the Cash-flow statement.

  • Multiple product company performance analysis  

    Video 2 teaches you how to analyse a company based on turnover. You will also learn how to compare Variable costing to Absorption costing and to eliminate Absorption costing as a viable system for profit analysis. I also teach you how to analyse a multi-product company and reconcile the budget profit to the actual profit.

  • Four business sectors  

    Video 3 teaches you how to analyse four different sector companies. Each one is different in terms of products manufactured or sold as well operating structure. You will learn how analyse data, set budgets and reconcile the Budget Income Statement to Actual results. 

  • Limiting factors, operating leverage and strategic plan  

    Video 4 teaches you how to analyse a company that has operating limiting factors. You will be able to assess a limiting factor or factors and set a budget. You will also learn the mechanics of operating leverage and its effect on profitability as sales increase or decrease. Going forward strategic planning is vital. You will be able to identify sectors in your company that require attention so as to increase profitability.

  • Practice example  

    Practice example

Module 3 -Financial statement analysis and Company Valuations
  • Financial statement analysis – Business charts and ratios  

    Video 1- 23 minutes

    This first video gives you a picture of how the 3 Financial Statements interact to explain the operational side of a business. You will also learn the starting point in ratio analysis for each Financial statement.

  • Finance risk and Cash flow statement  

    Video 2 - 23 minutes

    Video 2 teaches you the effect that debt has on a company – the positives and the negatives. You will also learn how to create a cash flow statement.

  • Business and Finance risk Assessment  

    Video 3 - 33 minutes

    Video 3 teaches you how to analyse business risk and finance risk using ratio analysis. You will learn how to analyse the business risk ratios as they relate to the income statement paying special attention to the company’s operating risk.

    Finance risk relates to debt usage by the company. Here you will learn the ratios that highlight how risky the company is in terms of debt usage.

    You will also learn how to evaluate the balance sheet asset ratios in terms of liquidity.

  • Financial Statement Template  

    Video 4 - 18 minutes

    At the end of this video you will be able to prepare Financial Statement templates that fully analyse the business and financial risk of a company. You will learn how to document your analysis in a manner that fully evaluates the status of a company.

  • Practical case study  

    Video 5 - 33 minutes

    This video takes you to a case study of a quoted company. You will learn how to assess the performance of a quoted company in line with the principles that I have been teaching you in module 3.

  • Company valuations  

    Video 6 - 32 minutes

    In this section I will teach you the three going concern valuation methods. I will then take you through an example of a free cash flow valuation where the company is financed using share equity only

  • Free Cash flow valuations of a debt-equity financed company  

    Video 7 - 25 minutes

    At the end of this video you will be able to value a company using the free cash flow method for companies that are financed with equity and long term debt.

  • Earnings valuation  

    Video 8 - 28 minutes

    In this final video you will learn how to value a company using a dividends valuation as well as an earnings valuation method. I will also teach you how to use a valuations template to document your valuation.

    Please go through the valuation notes as provided. Therein you will find a detailed valuation of a quoted oil company.



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