Analyzing Business Financial Statements and Tax Returns Suite
Course Number: ABA
Course Code: ABA
These seven courses explore how to analyze and interpret business financial statements and tax returns, including cash flow statements. Courses also cover the components of CRE cash flow and the drivers of cap rates.
The courses included (only available as a suite) and their objectives are listed below:
- Income Statement Analysis
Explain the components of revenue and cost of goods sold. Describe operating expenses and net profit analysis.
- Balance Sheet Analysis
Identify balance sheet considerations, describe the different types of assets, and explain the components involved in a liability and equity analysis.
- Ratio Analysis
Describe the use of ratios to evaluate financial performance. Identify, calculate and interpret liquidity, financial leverage, profitability, efficiency and debt coverage ratios. Explain how to use industry data when performing a ratio analysis.
- Cash Flow Analysis
Identify cash flow statements and reports, and describe the two dominant types of cash flow reports—indirect and direct. Explain the direct method for operating activities and the importance of pro forma and cash budgets.
- The UCA Model
Compare the formats of the banker-prepared UCA cash flow model and the accountant-prepared statement of cash flows (SCF). Construct a UCA model and interpret the results. Explain the advantages of the UCA model.
- Cash Budgets and Pro Forma Statements
Describe a cash budget and explain its purpose, including why it is a critical tool in financial statement analysis. Identify key financial information in the cash budget format. Analyze the cash budget and determine its effect on the operating cycle, working capital and capital expenditures.
- NEW: CRE Cash Flow and Cap Rates
Identify the components of CRE cash flow, and explain why two cash flow numbers may be appropriative when underwriting CRE loans. Describe the primary drivers of cap rates in estimating property values.
Audience: Commercial and/or business bankers and credit analysts.