Get Global: Understanding Global Cash Flow Analysis
Course Number: Seminar
Understanding how to calculate and interpret cash flow is essential for successful bankers.
This course is designed to assist bankers in calculating cash flow utilizing the Uniform Cash Flow Analysis (UCA) methods and to provide guidance in calculating Global Cash Flow Analysis for those entities that must rely on excess cash generated by their owners to service the business entity?s commercial debt.
The seminar will begin by defining Cash Flow as the tool to transform an Accrual Basis Financial Statement into a Statement of Cash Flow and its importance to bankers when considering a long term loan request. Then it will proceed to demonstrate how Cash Flow is calculated utilizing the balance sheet and the income statement to determine the sources and uses of cash from operating, investing and financing activities.
Next, a review of the owners personal financial statement and tax returns will be presented in order to determine the excess compensation necessary to support the debts of the business entity and the individual. That is the entire premise of Global Cash Flow Analysis.
The use of several cases will be provided in order to demonstrate Global Cash Flow Analysis including a case for the Self-Employed borrower with interests in several business entities.
Upon completion of this course, the participant will have a good understanding of how cash flow is calculated and more importantly, how to interpret its meaning.
- An illustration on how Cash Flow Analysis is used to transition an Accrual Basis Financial Statement into a Statement of Cash Flow (or Cash Basis Statement) because loans are repaid with cash and not profits.
- Review of the Rules of Cash Flow which are essential in determining how much cash is generated from items on the balance sheet.
- Global Cash Flow Analysis Methodology utilizing financial statements, tax returns and credit reports of commercial borrowers, and individuals.
- Comparison of the UCA method of calculating cash flow to the less effective traditional EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) method of determining cash flow.
Audience: Senior Loan Officers, Senior Credit Officers, Commercial Loan Officers, Branch Managers, Credit Analyst, Loan Review Personnel, Consumer Loan Officers, Credit Administration Support Staff