Course

Course Summary
Credit Type:
Course
ACE ID:
CFTA-0002
Organization:
Center for Financial Training
Location:
Classroom-based
Length:
11 weeks (59.2 hours)
Dates Offered:
Credit Recommendation & Competencies
Level Credits (SH) Subject
Lower-Division Baccalaureate 3 Financial Accounting and Analysis, Principles Of Accounting, or Accounting For Managers
Description

Objective:

The course objective is to provide the skills needed to effectively assess a commercial borrower's ability to repay loans by identifying the reasons why businesses need to borrow; structure a commercial loan properly; define the legal structures available to a business; analyze income statements, balance sheets, cash budgets, pro forma statements, and personal financial statements; calculate key financial ratios and use them to compare a company's performance with that of the company's industry; identify and construct cash flow statements and analysis; and develop a global cash flow and global debt service coverage for a business.

Learning Outcomes:

  • Identify the various borrowing arrangements used to structure a business loan
  • Identify and evaluate a borrower's financial strengths, weaknesses, and uncertainties
  • Compare and contrast the cash method and accrual method of accounting
  • Explain the components involved in liability and equity analysis
  • Describe the considerations a lender needs to take into account when using ratios to evaluate financial performance
  • Identify, calculate, and interpret liquidity, financial leverage, profitability, efficiency, and debt coverage ratios
  • Describe the two dominant types of cash flow statements and model formats- indirect and direct methods
  • Explain the importance of pro forma statements for projecting cash flow and loan repayment
  • Explain why global cash flows critical when making credit decisions
  • Describe the purpose of the operating cycle
  • Evaluate the risks within the major industry types
  • Identify the reasons why companies need to borrow
  • Define the basic types of legal structures available to businesses
  • Describe the general characteristic of the four stages in the business life cycle
  • Describe the financial stamen analysis process
  • Construct a balance sheet and income statement on the accrual basis for a company
  • Explain the components of revenue and the cost of goods sold
  • Explain the basic formats and preliminary analysis of a personal financial statements (PFS)

General Topics:

  • Business sectors and operating cycles
  • Business legal structures and life cycles
  • How business financial statements are constructed
  • Income statement analysis
  • Ratio analysis
  • Cash flow analysis
  • Cash budgets and pro forma statements
  • Personal tax returns and cash flow
  • Combining business and personal cash flow into global cash flow
Instruction & Assessment

Instructional Strategies:

  • Case Studies
  • Discussion
  • Lectures
  • Practical Exercises

Methods of Assessment:

  • Examinations
  • Performance Rubrics (Checklists)

Minimum Passing Score:

70%
Supplemental Materials

Other offerings from Center for Financial Training

Accounting
(CFTA-0005)
Analyzing Financial Statements
(CFTA-0002)
Business Communication
(CFTA-0003)
Business Math
(CFTA-0018)
Commercial Lending
(CFTA-0006)
Consumer Lending
(CFTA-0007)
Economics
(CFTA-0008)
Financial Accounting
(CFTA-0022)
Human Relations
(CFTA-0009)
Human Resource Management
(CFTA-0025)
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