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02 December 2019

Advanced credit analysis: corporate risks, cash flow and projections

Category: MASTER COURSE

Take your knowledge to the next stage and develop your analytics skills. This intermediate level five day course develops a more detailed understanding of the components of the financial statements and the operating dynamics of companies.

We recommend that you do not attend Corporate credit analysis - level two immediately after having attended Corporate credit analysis - level one. An interval of a few months between the two courses will give you valuable time to put into practice all the skills you learned at level one.

Who should attend?
This course will be of benefit to those with 1-2 years' experience of credit analysis. A familiarity with financial statements is assumed. It is also suitable for investment analysts who wish to understand a company's financial standing from a credit perspective. Those who have attended Foundations for credit analysis: understanding and analysing financial statements will be well prepared for this course.

What you will gain
Learning outcomes include obtaining a greater understanding of:

  • framework for credit analysis
  • components of credit analysis
  • risks to the business
  • tools for evaluating corporate strategy
  • analysis of the financial statements
  • understanding the business
  • the dynamics of cash flow
  • forecasting
  • corporate failure
  • collateral supporting the debt
  • covenants to protect the lender
  • structural subordination.

Programme outline
Framework for credit analysis:

Components of credit analysis: assessment of management, analysis of a company's ability to repay and protection for the lender; collateral and covenants.

Risks to the business:

  • macro factors: political, economic, environmental and demographic
  • industry factors eg: growth trends, exposure to economic cycles, barriers to entry and regulation
  • corporate specific risks eg: product/geographic diversification, support levels, strength of major customers and suppliers.

Tools for evaluating corporate strategy:

  • PEST analysis
  • product mission matrix
  • market life cycle
  • product portfolio matrix
  • porter's model of competition
  • SWOT analysis.

Analysis of the financial statements:

  • accounting principles
  • overview of main differences between UK GAAP and IFRS
  • critical areas for review in the financial information
  • review of balance sheet and profit and loss account
  • off-balance sheet items
  • adjusting the accounts for analytical purposes
  • areas of flexibility in accounts eg: off-balance sheet financing, stock values, capitalisation of expenses and revenue recognition.

Understanding the business:

  • interpretation through ratio analysis
  • liquidity and the cash cycle
  • working investment as a measure of liquidity
  • identifying company dynamics

The dynamics of cash flow:

  • construction and format of cash flow statements
  • understanding and interpretation of cash flows
  • calculation of free cash flow
  • debt capacity

Forecasting

  • uses as a management tool
  • forecasting key assumptions
  • projection of the balance sheet and profit and loss account
  • forecasting cash flow
  • sensitivity analysis

Corporate failure

  • identifying warning signs
  • reasons for corporate failure
  • the critical role of management

Collateral supporting the debt

  • why take collateral?
  • priority of creditors' claims
  • insolvency law and how it affects lenders' rights

Covenants to protect the lender

  • affirmative/negative covenants
  • financial covenants

Structural subordination

The course starts at 9.00am on each day. Lunch and refreshments are included, but not accommodation.
30 CPD hours (where applicable). 

CIMA work in partnership with BPP Professional Education to offer CPD training courses

Booking Information

Date Location Price
2 December 2019 - 09:00 London - five day course Price: GBP 3,140.00
Member price: £2,826. Plus VAT on all prices. Excluding accommodation.


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Foundations for credit analysis: understanding and analysing financial statements

MASTER COURSE

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The market standard introductory course which will teach you how to write and support a basic corporate credit review. No prior knowledge of credit analysis is assumed.

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Advanced credit analysis: corporate risks, cash flow and projections

CIMA members and students should log in to MY CIMA before booking to receive the appropriate discount.

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In-house training 
We can develop tailored training programmes to enhance the finance and business skills of staff across your organisation. To discuss how we can meet your learning and development needs please email us.

Find out more 
If you have any queries please email cima@bpp.com or phone us on: +44 (0)3300 603400.

The venue for this course will be confirmed 14 days before the scheduled date. 

CIMA work in partnership with BPP Professional Education to offer CPD training courses.  

This course will be delivered by BPP Professional Education Limited (“BPP”).  Accordingly, when you sign up for this course, CIMA will pass on the contact details you have provided to BPP so that they can contact you to complete your booking and process payment.  BPP will process any personal information it collects about you in accordance with its privacy policy, which is available at: http://www.bpp.com/professional-education/privacy

The information provided to BPP will not be used by BPP for marketing purposes.

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