Understanding Finance To Influence Strategic Decisions

Course Code: FA26

►Course Objective


  • Think strategically and use the strategic management process and its links to key performance indicator (KPI) systems as a basis for improved decision-making to maximise shareholder wealth
  • Analyse and interpret the income statement, balance sheet, and statement of cash flows, and use appropriate costing and measurement systems for more effective planning and budgeting, management of working capital and cash flow, and improved financial performance
  • Identify the alternative sources of long-term finance, and evaluate the models of optimum capital structure and minimisation of the weighted average cost of capital (WACC)
  • Apply the technique of discounted cash flow (DCF) for evaluation of capital project investments, and capital budgeting
  • Use the techniques of uncertainty analysis and risk analysis and develop appropriate risk management tools, and insurance and hedging of interest rates and foreign currency exchange rates


►Target Audience


  • General Management
  • Sales and Marketing
  • Estimating and Costing
  • Operations
  • Engineering
  • Project Management
  • Procurement
  • Logistics
  • Asset Management
  • Human Resources
  • And any other financial and non-financial professionals that need or wish to understand the financial aspects of the strategic decision-making process.


►Course Outline



Linking Strategic Management and Decision-making with Financial Planning and Budgeting

  • Strategy and strategic management
  • Vision, mission, and objectives
  • Key features of strategic decision-making
  • Rolling out and implementing strategies
  • Value creation and maximisation of shareholder wealth
  • Corporate objectives, accountability, and corporate governance
  • Management accounting and the links between strategic planning and budgeting


The Financial Statements and Their Links with Planning and Financial Decisions

  • The three key financial statements
  • Balance sheet
  • Income statement
  • Statement of cash flows
  • Sources of internal and external funding
  • Cost of equity, cost of debt, and the weighted average cost of capital (WACC)
  • Capital structure models to minimise WACC
  • Preparing a long-term financial plan to determine funding requirements


Costing Systems, Budgets and Measurement Systems that Support Financial Decision-making

  • Costs and activities
  • Cost behaviour
  • Fixed costs and variable costs
  • Cost/volume/profit (CVP) relationships, contribution and break-even analysis
  • Direct and indirect costs
  • Activity-based costing (ABC)
  • Refining the costing system for improved decision-making


Capital Investment Decisions

  • Future values, present values and discounted cash flow (DCF)
  • Capital budgeting principles
  • Evaluating capital investment projects using accounting rate of return (ARR) and payback
  • DCF evaluation methods of net present value (NPV), internal rate of return (IRR), modified internal rate of return (MIRR), equivalent annual cost (EAC)
  • Deciding on which investment appraisal methods to use
  • Capital budgeting, capital rationing and the profitability index (PI)
  • Further factors to consider in investment appraisal


Linking Performance Measures to Strategic Decisions and Financial Risk Management

  • Linking strategic objectives to key performance indicators (KPIs) in a balanced scorecard
  • Obstacles to achieving strategic objectives created by the accounting and costing system
  • Uncertainty and risk analysis
  • Types of business risk and financial risk
  • Risk management principles
  • Development of risk management tools to mitigate and minimise risk
  • Insurance and hedging
  • Interest rate risk and foreign currency exchange rate risk

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Date & Location

Date : 16 February 2020

Duration : 5 days

Place : Kuala Lumpur

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Date : 19 July 2020

Duration : 5 days

Place : Istanbul

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