Finance for non-Financial Directors

Director Development Programme 2023 >> Finance for non-financial directors

Why should you attend?

All directors (executive and non-executive) are personally and jointly responsible for all the decisions taken by the board of which they are members. Many of their decisions relate specifically to finance or have a financial impact and these need to be understood.

In medium and large companies a finance director is responsible for the supply of correct financial information and for guidance on the financial implications of the board’s decisions. In smaller companies the managing director may carry out this role.

However, the responsibilities for sound governance are the same for all the directors, whether financially qualified or not. For this reason, all directors must have a good grasp of the principles underlying financial decision-making.

Course features and benefits

This course will provide you with the financial concepts and terms needed by all directors in today’s business world. As a result of taking this course, you will be in a better position to assess your organisation’s financial position and help deploy financial strategies to support it.

Participation on this course will enable you to:

Understand the collective responsibility of directors in the field of financial management and financial stewardship
Use financial terminology with confidence
Apply a structured framework including accepted financial ratios to assess the financial performance of an organisation
Monitor the financial performance in the interest of protecting the assets of your own organisation
Understand the differences between financial accounting and management accounting
Write a cash flow forecast that can be used and shared to progress your decision making
Make more informed decisions on the different types of finance available
Maximise the chances of success when approaching providers of capital e.g. Banks, Venture Capitalists
Go through the various methodologies to value a business
Identify the major risks facing a company and how to manage those risks

Part of our Director Development programme

Our Director Development programme offers a comprehensive and practical experience, created by world-leading board experts that have decades of experience helping business leaders thrive and grow within their current and future roles.

As a director, navigating challenges whilst keeping your business operating legally and effectively can be difficult. Whether you’re an experienced director, or just starting your first appointment, understanding what is expected of you in your role is vital to staying on top of your responsibilities.

You may also meet a diverse range of delegates that operate across private, public and charitable sectors, and so these peer-to-peer learning experiences will offer different perspectives, the ability to network and share similar challenges with real-world outcomes.

We work in an ever-changing environment, so we offer all of the modules in our programme in a virtual or face-to-face capacity.

Finance for non-Financial Directors - course outline

This course will cover the following:

Section 1 – The financial role and responsibilities of directors

Collective & fiduciary responsibility
Directors & shadow directors
Duties and responsibilities
Financial strategy

Section 2 – Sources of finance (and their relative advantages and disadvantages)

Why businesses need funding
Short and medium-term finance
Sources of long-term finance (to include an overview of capital markets)
Equity – from Venture Capital to Private Equity Financing
Debt – loans vs bonds and the implications
Derivatives – risk mitigation & pitfalls
The role of commercial & investment banks in matching investors with companies
Balance Sheet structure and capital gearing

Section 3 – Understanding and interpreting financial statements

Financial concepts, conventions and terminology
The basis of profit measurement and the difference between profit and cash flow
The statutory financial statements: Income Statement, Balance Sheet & Cash Flow Statement
The effects of transactions on financial statements

Section 4 – Assessing Financial Health

A structured framework for financial analysis
Use of typical ratios
Profitability Ratios: margins, EBIT & EBITDA, operational gearing
Balance Sheet Ratios: Financial gearing & Interest cover
Investment Ratios: ROI, ROA, ROCE, ROE, WACC, EVA
Du Pont Analysis overview
Liquidity Analysis: Current Ratio & Acid Test, calculating the Working Capital Requirement
Cash Flow Analysis: Operating Cash Flow, Net Cash Flow, Free Cash Flow
Investor Ratios: Dividend cover

Section 5 – Distinguishing between management accounts and financial reports

To identify what financial measures are appropriate in different organisations
Frequency of reporting required for effective direction
Understand the role of budgets in directing a business
Costing systems and contribution analysis – Break-even analysis
The cash flow forecast
Understanding the relationship between financial and non-financial performance measures in directing a business (the balanced scorecard)

Section 6 – Creating Value

Cost of capital: WACC & EVA
Project appraisal techniques to include: payback, discounted cash flow (DCF), net present value (NPV) and internal rate of return (IRR)
Business valuations

Section 7 – Corporate Failures

Why businesses fail
Recognising the early signs of business distress
Assessing and managing risk

Course objectives

Participation on this course will enable you to:

Understand the collective responsibility of directors in the field of financial management and financial stewardship
Use financial terminology with confidence
Apply a structured framework including accepted financial ratios to assess the financial performance of an organisation
Monitor the financial performance in the interest of protecting the assets of your own organisation
Understand the differences between financial accounting and management accounting
Write a cash flow forecast that can be used and shared to progress your decision making
Make more informed decisions on the different types of finance available
Maximise the chances of success when approaching providers of capital e.g. Banks, Venture Capitalists
Go through the various methodologies to value a business
Identify the major risks facing a company and how to manage those risk

Duration and dates

3 days
Virtual dates: 10-12 October
Face-to-face dates: 12-14 September

Course leader - Ted Wainman

Ted is a professional business trainer, keynote speaker and published author. Qualified as a Chartered Accountant with Ernst & Young, he worked with JP Morgan and completed their MBA in the International Management of Financial Services.

For nearly 20 years, he has designed, developed, and delivered programmes for the private sector, across a range of boardroom needs. With his background in finance, Ted has a focus on finance and commercial training (including strategy and leadership) but is also comfortable with a variety of softer skills around
negotiation, presentation, and effective communication.

Ted has worked in over 35 countries and is experienced in addressing the needs of varied cultural backgrounds. Ted is the author of “How to Talk Finance: getting to grips with the numbers in business” published by Pearson (FT) in April 2015.