Accounting and Financial Statement Analysis

Learning Outcomes

Unilever Case Study
Constructing Financial Statements
Ratio Analysis
Understanding Relative Valuation Methods
Grasping Absolute Valuation Methods
Credit Analysis

Discourse

In this course, you will be introduced to a case study, which will give you the opportunity to understand the way a company’s accounts are set up. By incorporating an exercise using a series of transactions to construct a financial statement, this is a fun and engaging introduction to financial statements. You will analyse ratios used to assess financial positions. We will discuss and examine intrinsic vs. market valuation as well as review, calculate and undertake a market examination of Enterprise Value (EV).

Program Overview

Case Study: Unilever. Analysts are tasked with understanding their company accounts

Introduction to Financial Mathematics
Accounting 101
Key Financial Ratios
Company Valuation
Financial Modelling

Financial Statements

How Statements are Constructed
Analysis of a Company’s Financial Statements to gain practical understanding of realities/complexities of a set of accounts

Ratio Analysis

Discussion of common ratios used to asses financial position in terms of Short-Term Solvency, Debt Management, Asset Management, Profitability and Market Value
Work with ratio analysis to evaluate a company and present findings

Valuation Overview

Intrinsic Market valuation
Discussion, calculation and market examination of Enterprise Value (EV)

Relative Valuation Methods

The concept of relative valuation
Discussion and illustration of:
- Select a peer group
- Select a multiple or multiples
- Calculate multiple(s)
- Apply the multiple
- Calculate Equity value (via Enterprise Value)

Absolute Valuation Methods

The concept of absolute valuation
Discussion and illustration of:
- Forecast Free Cash Flow to Firm (FCFF)
- Estimate Terminal Value (TV)
- Calculate WACC
- Discount FCFF and TV at WACC
- Move from Enterprise Value to Equity value