ACCOUNTING, FINANCIAL and CASH FLOW MANAGEMENT, PLANNING and BUDGETING and ENTREPRENEURLISM/TVET:
Workshop that cover five overlapping and strongly integrated modules:
- Financial Management
- IFRS / IAS and IFRS for SMEs (IPSAS)
- Cash Flow Management
- Entrepreneurialism / TVET
- Planning and Budgeting
This module targets the discipline and concepts of what is financial management. Financial management is all-encompassing and embraces both the asset and liability sides of an organization. Although the financial manager, a senior position on par with the CFO and Treasurer, they are not engaged in the accounting functions nor that of auditing for example, but he/she is integrally involved in most aspects of deriving the net income. The financial manager, from asset/liability management, to capital structure, to working capital and identifying financing sources amongst a myriad of options and costs, some transparent others hidden or comingled all fall under this role. Given its natural overlapping, especially with treasury, vis-à-vis banking relationships and funding sources, cooperation amongst key players such as the financial manager, CFO and treasurer becomes critical for ensuring that taking, for example, a derivative position, is agreed upon and documented as a financially sound position to take. Additionally this program discusses capital expenditure evaluation techniques (NPV/IRR) along with merges and acquisitions, from both the financing perspective and what contributes often to failed outcomes. Finally we’ll discuss derivative theory of managing risk, hedging, linked with IFRS standards in this area.
IFRS / IAS and IFRS for SMEs (IPSAS)
The IASB’s Framework for the preparation and Presentation of Financial Statements describes the basic concepts by which financial statements are prepared. It provides a guide to the IASB in developing accounting standards and as a guide to resolving accounting issues that are not addressed directly in an international Accounting Standard or International Financial Reporting Standard or Interpretation.
Cash Flow Management
This module targets the discipline and concepts of what is cash flow management. What drives any company’s success in the long run is its ability to handle and manage cash flow. Ordinarily the management of cash falls under the cash flow/treasury manager, however the role of financial manager or the concept of financial management is very directly involved as is the CEO/CFO. Many confuse net income with positive cash flow and that is totally incorrect. The statement of cash flow divided into its three segments was aimed at identifying where cash flow was coming from, being used, and if there were clearly cash flow problems identified. However notwithstanding this the learning objective is not intended to target the cash flow statement exclusively. What is critical from a cash flow analysis perspective is to identify the sources of cash and where they’re being employed i.e., forecasting cash flow from 1-5 days or more. Integrated clearly within this statement is the concept of risk and how that is being measured and managed. This is not an advanced class on risk however we will examine risk from the perspective of working capital. Though focused on banks and financial institutions we will also consider asset liability matching (ALM) as that clearly falls under cash flow management along with anti-money laundering (AML). Cash flow is also a critical component of developing 3-5 year business forecasting models that we’ll discuss under Planning and Budgeting.
Entrepreneurialism / TVET
Many people aspire to becoming an entrepreneur, however very few succeed because of the inability to grasp all the nuances and subtleties and requirements to be successful. Being a successful entrepreneur is considerably more than having a good idea whether it be to offer a service or to sell a product. Many who aspire to becoming an entrepreneur, mostly in the 20 to 30’s age group, may look back to the dot.com era with nostalgia and consider it possible to duplicate. That was an era where rather than being grounded in a bricks and mortar business it was taking advantage of the virtual Internet technology. Thus the eventual collapse of the dot.com era was hardly surprising when even projected losses became an investment. There are many disciplines embedded into becoming a successful entrepreneur. Such disciplines include accounting, finance, economics, marketing, sales, and leadership. As a subset, entrepreneurs need to fully embrace and understand the concept of management and additionally understanding that in order to be successful you need a highly competent and qualified human resource organization. Finally let us not forget, those little things like external audit, internal controls, documentation and process flows. All contribute towards becoming a successful entrepreneur and all these issues will be discussed. And as for TVET: The development of this new Strategy for TVET has taken into account the 2030 Agenda, the Education 2030 Framework for Action, the evaluation of the Strategy for TVET (20102015), the Recommendation concerning TVET (2015), UNESCO’s analysis of global trends in TVET5, and various consultations, such as a virtual conference on the new Strategy organized by the UNESCO-UNEVOC International Centre and meetings of the Inter-Agency Group on TVET on skills in the 2030 Agenda. The consultation and drafting process took place in coordination with the development of the Education 2030 Framework for Action (FFA). This is intended to ensure that the implementation of the Strategy for TVET and the FFA will mutually address key TVET policy issues, in particular youth employment, decent work, entrepreneurship and lifelong learning.
Planning and Budgeting
Different industries/entities are all unique and each of its business segments have their own revenue and expense structures. However, from a budgeting and planning perspective, there is no difference between industries. Like any other five-year business planning model, the sources of revenue need to be determined and projected based either on economics or strategy. From an expense standpoint most business planning models have clear similarities and thus are much easier to project. However, any strategic decisions, unique to a particular business segment, need to be factored in. We’ll also discuss different budget/planning methodologies along with noted criticisms.