Finance for Non-Financial Managers Your Name

Objectives At the end of this session you will be able to: Explain your impact on organisational finances and interpret key facts Understand financial terms and confidently discuss issues that affect company finance Interpret the three key financial statements – Profit & Loss, Balance Sheets and Cash Flow Plan, Implement and Monitor a Budget

Your Impact on Finances Upset Customer Good Advice Good Business Poor Management Poor Decision

Accounting Groups Revenue Expenses Capital Assets Liabilities

3 Key Financial Statements Balance Sheet Profit & Loss Cash Flow

The Cash Flow Cycle Cash Assets Credit Purchase of Goods Sales Collection of Money

Who is a cash flow statement important to? Executives Investors Shareholders Suppliers Employees

Operating Activities Investing Activities Financing Activities Cash Flow Categories Operating Activities Investing Activities Financing Activities

Budgeting – Questions to Ask Yourself Could we have spent less last year and still achieved the same results, or better? Have we wasted money in the past? If so, can we avoid doing so in the future?

Planning Cycle Review Past Review Objectives Prepare Operational Plans Assess Resources & Estimate Costs Discuss, Amend and Finalise Budget Implement Plans, Monitor & Adjust

Budget Methods Previous Year Coming Year Blank Page

Budget Options Minimum Target Stretch

Budget Information Categories in a budget are broken down into ‘budget line items’ There is a column for amounts budgeted for each line item There is a column for amounts actually spent for each line item There could be a column for budget deviation There might be a column for the previous years’ budget information for each line item It’s wise to make notes next to items

Monitoring the Budget Monitor against targets Report financial data Do cash flow projections Make financial decisions

Objectives At the end of this session you will be able to: Explain your impact on organisational finances and interpret key facts Understand financial terms and confidently discuss issues that affect company finance Interpret the three key financial statements – Profit & Loss, Balance Sheets and Cash Flow Plan, Implement and Monitor a Budget