Running a Profitable Business: Understanding Cash Flow

Course details

The cash flow statement is one of the three primary financial statements, but because it has only been around since 1988, many traditional business analysis models don't include it. And improper cash flow can mean the death of a business. This course reviews all the important topics you need to know for proper cash flow management and analysis. Professors Jim and Kay Stice review the difference between net income and operating cash flow, show how to interpret a cash flow statement, introduce the Jim Stice operating cash flow matrix, and describe some real cash flow catastrophes and triumphs at companies such as General Motors and Home Depot.

Topics include:
Review the need for a startup company to have sufficient cash flows.
Identify the components of a statement of cash flows.
Relate the concepts of cash flow analysis to a scenario.
Explore the direct and indirect methods of reporting cash flows.
Describe the operating cycle of a business.
Infer the outcome of decisions made by corporate managers.

Concepts

0. Introduction

01 - Understanding cash flow analysis

1. The Importance of Cash Flow Analysis

02 - Home Depot, 1985 - Case study
03 - Net income is not the same as operating cash flow
04 - Cash flow problems kill companies

2. Overview of the Statement of Cash Flows

05 - Introduction to the statement of cash flows
06 - Overview of the statement of cash flows
07 - Practice categorizing cash flows
08 - Deducing cash flow statements
09 - Interpreting Walmart's statement of cash flows

3. Using Cash Flow Data to Make a Loan Decision

10 - Mortgage loan application
11 - Interpreting free cash flow statements
12 - Relationships in cash flow statements
13 - Determining loan decisions
14 - Classifying a cash cow company

4. Convert Income Statement Data to Operating Cash Flow Data

15 - The Jim Stice operating cash flow matrix
16 - Understanding the direct method
17 - Understanding the indirect method
18 - Operating cash flow data as an IPO reality check
19 - Identifying economic performance
20 - Operating cash flow problems from high growth

5. Managing Cash Flow

21 - The Home Depot story revisited
22 - Managing operating cash flow
23 - Managing investing cash flow
24 - Managing financing cash flow

6. Cash Flow Numbers for Some Real Companies

25 - Tough times in 2008, except for Exxon Mobil
26 - Analyzing General Motors free cash flow
27 - Apple - Cash flow data helps unravel accounting issues
28 - The danger of free cash flow

Conclusion

29 - Manage company cash flow