Course Description

Financial Statements of Business Unit basically comprises Profit & Loss Statement (Income Statement) and Balance Sheet. Income Statement will convey where as Balance Sheet will convey the financial position of the unit.

Financial Statements will be used by various stake holders for various purposes.

Investors will analyse the financial statements before taking decision to invest in Business Unit.

Investors will analyse the financial Statements before lending money to the Business Unit.

Tax and Statutory Authorities will review financial statements for levying various Taxes.

Hence the financial statements will be used by various stake holders. Therefore every key personnel and every one working in an Organization's balance Sheet before stake holders raises unanswerable Questions.

Developing the skill to read Balance Sheet will help the Business units to understand their standing and analyse strength and weakness and plan for future.

One should develop the skill to read the Balance Sheet from various perspectives. This course will you provide all those perspectives.4

This course has been designed in self paced learning style. Hence, Learners will able to understand the concepts at their own place, timing and Convenience.

Numerous and illustrations has been used to make the understanding process simple and clear .

Chartered Accountant

Ca Raja Natarajan

I am a practicing Chartered Accountant with tonnes of passion for teaching. I teach Financial Management & Strategic Financial Management for Chartered Accountancy, Cost and Management Accountancy and Company Secretary students in Ernakulam, India. I also hold Post Graduate Diploma in Business Administration in Finance from Symbiosis, Pune and Bachelors in Commerce, from Loyola College, Chennai. I worked in State Bank of India as Assistant Vice President - Credit for a period of four years after which i started my Chartered Accountancy Practice. During the stint in State Bank of India, I worked on credit proposals of Mid Corporate Units and gained good experience in Financial Analysis, Risk Assessment, Viability Study, Evaluating business models, Project Finance, Working Capital Management, etc. I conduct work shops for Entrepreneurs, Chartered Accountancy / Cost and Management Accountancy Students on the topics like Project Finance, Credit Risk Assessment, Entrepreneurship Development, Finance for Non Finance Executives, etc. I love teaching and i want fundamentals of accounting and finance to reach students and so i am here.

Course curriculum

  • 1

    Introduction to Balance Sheet

    • Introduction to Balance Sheet

    • Why reading balance sheet is important

    • What is important in Reading Balance Sheet

    • Structure of Balance Sheet
  • 2

    Three Important Balance Sheet Reading Skills

    • First Balance Sheet Reading Skill Understanding Long Term Stability

    • Second Balance Sheet Reading Skill Understanding Liquidity Position

    • Third Balance Sheet Reading Skill
  • 3

    Balance Sheet Reading through Financial Ratios

    • Financial Ratio Analysis

    • Current Ratio

    • Quick Ratio

    • Absolute Liquid Ratio

    • Defense Interval Ratio

    • Capital Structure Ratio (Equity Ratio)

    • Capital Structure Ratios (Debt Ratio)

    • Capital Structure Ratios (Debt to Equity Ratio)

    • Coverage Ratios (DSCR)

    • Interest Coverage Ratio

    • Preference Dividend Coverage Ratio

    • Capital Gearning Ratio

    • Activity Ratios

    • Capital Turnover Ratio

    • Fixed Assets Turnover Ratio

    • Total Assets Turnover Ratio

    • Working Capital Turnover Ratio

    • Inventory Turnover Ratio

    • Inventory Holding Level

    • Debtors Turnover Ratio

    • Creditors Turnover Ratio

    • Average Payment Period

    • General Profitability Ratios

    • Gross Profit

    • Operating Ratio

    • Operating Profit Ratio

    • Average Collection Period

    • Expense Ratios

    • Net Profit Ratio

    • Overall Profitability Ratios

    • Return on Assets

    • Return on Capital Employed

    • Return on Share Holders Funds

    • Return on Equity Share Holders Funds

    • Earnings Per Share

    • Cash Flow Earnings

    • Dividend Per Share

    • Dividend Pay Out Ratio

    • Dividend Yield Ratio

    • Illustration on Return on Equity Share holders Funds

    • Market Value Ratio

    • Earnings Yield Ratio

    • Price Earnings Ratio

    • Price to Cash Flow Ratio

    • Market Value to Book Value Ratio
  • 4

    Balance Sheet Reading through Fund Flow Statement

    • Fund Flow Analsyis Introduction

    • Fund Flow Analysis Example

    • Uses of Fund Flow Statement
  • 5

    Balance Sheet Reading through Cash Flow Statement

    • Cash Flow Introduction

    • Cash Flow Activities

    • Cash Flow Operating Activities

    • Cash Flow Investing Activity

    • Cash Flow Financing Activity
  • 6

    Others

    • Business Financing Decisions

    • Debt Vs Equity Financing

    • Good Time and Bad Time for Debt Equity Financing