Advanced Cash Flow Analysis - Counterparty Credit Analysis
About This Course
• Use industry and macro characteristics to build expectations about resource requirements, performance metrics and cash flow drivers
• Perform quantitative review of companies’ revenue model, cost structure, margins and working capital management to establish optimal financing requirements
• Define types of cash flows and its characteristics in various industries and companies
• Learn about components of indirect cash flow statements and factors driving financing and investment decisions
• Analyse liquidity cushions and financial leverage, evaluate company’s capital structure and cash flow adequacy
• Acquire advanced techniques of financial forecast models and debt capacity tools to sculpt future debt structures using normalised FCF
• Understand key types of debt instruments and its application to highly leveraged transactions
• Evaluate group and transactional structure to highlight risk and formulate appropriate safeguards.
What You'll Learn
Economic Implication for Sector & Industry Performance
- Sector classifications, Cyclical versus Defensive industries.
- Tools for a structured analysis of an industry.
Cash Flow: Structure & Analysis
- Types of cash flow statements – a bridge between Financial Year Ends
- Structure of an “indirect” cash flow statement
- Cash flow terminology – FFO, OCF, FCF, FCFF & FCFE
- Key ratios for understanding adequacy linked to industry characteristics
Cash Flow Drivers & Business Risk
- Revenues - Sustainability and Stability
- Margins – Understanding cost structures
- Working Capital Management
Capital Structure: Impact on Financial Risk & Cash Flow Adequacy for Solvency
- Company funding structure, overall business risk and evaluation of debt service ability and refinance risk.
- Liquidity providing financial flexibility
- Long-term sources of capital
- Solvency, combining capital structure with free cash flows to evaluate debt servicing ability as an ongoing concern.
- Tools of debt sculpting (debt capacity, financial modelling, and forecasting to project future capacity)
Entry Requirements
Participants should preferably have a minimum of 2-3 years relevant experience, with understanding of accounting and financial statements.