Cash Flow Cycles and Analysis

Course details

Learn how companies manage their cash flow in this course that explores both the operating cash flow cycle and the investing cash flow cycle, using real-world examples to calculate a company’s working capital funding gap. Explore the important strategies companies can use to optimize their working capital accounts, examine the longer-term investments such as sustaining or expansionary capital expenditures, and find out how to assess the payback time on a project and look at the return on investment. Finally, combine what you learned and produce a cash flow statement to compare key metrics such as net income, EBITDA, cash flow from operations, and free cash flow. The course looks at things from both the lender's perspective and the borrower's perspective, so you'll have a full picture as a complete credit analyst of how to forecast and optimize cash flow for a business.

Learning objectives
Discuss the difference between a company's short-term operating cash flow and long-term investing cash flow.
Compare working capital objectives and capital investment objectives.
Calculate working capital funding gap, investment payback, and return on investment.
Use a company's financial statement to conduct a cash flow analysis and compare key metrics.

Concepts

0. Introduction

01 - Introduction
02 - The importance of cash
03 - Why businesses fail at cash management
04 - Comparing short-term vs. long-term cash flow strategies

1. Operating Cash Flow Cycle

05 - Overview of operating cash flow cycles
06 - Total working capital and operating working capital
07 - Understanding inventory in cash flow management
08 - The role of accounts receivable in cash flow
09 - The role of accounts payable in cash flow
10 - Key objectives in managing working capital
11 - Working capital funding gap
12 - Funding gap and operating line calculator overview
13 - Calculate receivable days, inventory days, and payable days
14 - Calculate operating line required and allowed
15 - Improving the working capital cycle - Accounts payable
16 - Improving the working capital cycle - Accounts receivable
17 - Improving the working capital cycle - Inventory
18 - Working capital objectives
19 - Streamlining efficiency in working capital practices
20 - Strategies to optimize liquidity

2. Investing Cash Flow Cycle

21 - Differences between working and investing capital
22 - Understanding capital expenditures (CapEx)
23 - Exploring different types of capital investments
24 - Understanding the long-term capital investment cycle
25 - Calculating payback and ROI on capital investments
26 - Making capital investments work for you
27 - Capital investment objectives

3. Cash Flow Cycles and Analysis in Excel

28 - Overview of cash flow cycle case study
29 - Understanding the balance sheet in cash flow analysis
30 - Analyzing cash flow from operating activities
31 - Understanding cash flow from investing activities
32 - Exploring cash flow from financing activities
33 - Assessing end-of-year cash and equivalents
34 - Conducting a comprehensive cash flow analysis

Conclusion

35 - Cash flow cycle and analysis course summary