Credit Analysis Techniques

SUITABLE FOR:

Credit Managers, Credit Analysts, Risk Managers, General Managers, Finance Directors, Financial Controllers, Treasury Managers, Treasurers, Finance Managers, Accounts Managers, Treasury Analyst, Financial and Management Accountants, Auditors, Financial Analysts, Accounts Supervisors and Accounts Superintendents..

OBJECTIVES:

By the end of the course, delegates will:

• Be able to interpret financial statements more effectively and identify key information in assessing the financial viability of an organisation
• Use ratio analysis as part of the means of establishing a company's credit worthiness
• Be able to construct cash flows and make forecasts
• Understand the relationship between company valuation and credit analysis
• Have a better understanding of credit grading techniques and issues
• Be able to hold constructive and useful meetings with customers regarding credit issues

SUMMARY:

Day One
Introduction to Credit Analysis

• Credit analysis and risk
• Main beliefs of good lending

Risk

• The business cycle
• Analytical framework
• Levels of risk
• The credit risk framework
• Evaluating business risk (non-financial)
  • SWOT Analysis
  • Porter's 5 forces, generic strategies
  • Boston Consulting Group Matrix
  • Product/Industry lifecycle
• Risk Management
• Assessment and presentation of corporate risk

Day Two
International Accounting Standards

• Main content of IASs and how they differ from national standards
• Latest developments in IASs and their use world-wide
• GAAP Accounting

What information will I find in the Accounts?

• The profit and loss account
• The balance sheet
• The cash flow statement
• The statement of total recognised gains and losses
• The note of historical cost profits and losses
• Other Accounts information
• Exercise
• Case studies

Day Three
Interpretation of Financial statements

• Earnings per share and limitations of using earnings per share as a measure of a company's performance
• Ratio Analysis - the use, implications and limitations of financial ratios
• Performance, profitability and activity
• Gearing
• Stock market ratios
• 'Not for Profit' Organisations
• Trend Analysis
• Interpretation of cash flow data
• Case studies

Day Four
Cash flow

• Sources and uses of cash in a business
• Cash flow construction and forecast
• Case Studies

Leasing

• The nature of leasing
• Lease pricing

Day Five
Risk Management

• Risk mitigation
• Company valuation and credit analysis
• Credit grading
• Meetings with the customer
• Exercise