Cash Flow Forecasting

Table of contents

1. Cover
2. Cash flow forecasting
3. Contents
4. Preface
5. 1 Overview of cash flow forecasting
   1. Introduction
   2. What is a healthy cash flow?
   3. What are the uses of cash flow forecasting?
6. 2 Summary of financial statements
   1. Introduction
   2. The annual report and accounts
      1. Statements of standard accounting practice, and financial reporting standards
         1. Consequences of fraudulent manipulation of accounts
      2. The auditors’ report
      3. The balance sheet
      4. Assets and liabilities (1/2)
      5. Assets and liabilities (2/2)
         1. Assets
         2. Liabilities
         3. Summary
      6. Debtors
      7. Creditors
      8. Stock and work in progress
      9. Borrowing as shown in a company’s accounts
         1. Banking facilities
      10. Fixed assets
          1. Depreciation
          2. Book value
      11. Authorized and issued share capital
      12. Reserves
   3. The profit and loss account
      1. Turnover
   4. Problems with financial statements and auditors
   5. Conclusion
7. 3 Factors impacting financial performance
   1. Introduction
   2. Strategic analysis – the external environment
      1. Environmental analysis
      2. PEST analysis
      3. Competitive analysis
   3. Strategic analysis – the value chain
      1. Value chain competition example
   4. Management
   5. Profitability and performance
      1. Return on equity
      2. Net profit margin
         1. Profitability and performance measurement
         2. The profit margin and asset turnover relationship
      3. Reliability of financial information
   6. Asset management
      1. Asset turnover and liquidity
      2. Stock turnover
      3. Collection period
      4. Payment period
      5. Net working assets to sales and overtrading
   7. Capital structure
      1. Financial leverage
      2. Financial flexibility
      3. Interest cover
   8. Cash flow
      1. Cash and profit
      2. Operational cash flow
   9. Cash flow forecasting
      1. Percent-of-sales forecasting
      2. Forecasting methodology
      3. Sustainable growth
   10. Corporate failure
       1. Reasons for failure
       2. Recent research
       3. Failure prediction models
8. 4 Cash flow forecasting of financial statements
   1. Why cash flow analysis?
   2. Purpose of projections
   3. Historical performance and variable input analysis
      1. Defining the initial assumptions
      2. Procedure for constructing projections
         1. One approach to constructing projections
   4. Profit and loss statement projections (1/2)
   5. Profit and loss statement projections (2/2)
      1. Net sales projections (1/2)
      2. Net sales projections (2/2)
         1. Evaluating volume and pricing components
         2. Relating a firm’s performance to industry and economic conditions
         3. Example
      3. Completing the profit and loss projections
      4. Cost of goods sold/gross margin projections
      5. Selling, general and administrative expense (SGA)
      6. Operating profit
         1. Example
      7. Profit before tax
   6. Balance sheet projections
   7. Assets
      1. Fixed assets, capital expenditure and depreciation
         1. Example
      2. Inventory turnover
         1. Example
      3. Accounts receivable turnover
         1. Example
      4. Cash and marketable securities
         1. Example
   8. Liabilities
      1. Current liabilities
      2. Accounts payable
         1. Example
      3. Accrued expenses payable
      4. Debt runoff schedule + future facility
         1. Example
      5. Net worth
         1. Example
      6. New money need
      7. Amortization schedule for new debt
   9. Completed AmaOS forecasted balance sheet
   10. Cash flow projections
       1. Construction and evaluation of future cash flow model
   11. Cash flow ratio analysis
       1. Interest cover ratio
       2. Financing payments cover ratio
       3. Total debt payout
       4. Long term debt payout
       5. Debt service ratio
   12. Sensitivity analysis
   13. Protection and control in term lending
       1. Covenants, events of default, and their relationship to projections
   14. Conclusion
   15. Chapter self-test
   16. Chapter self-test answers
9. 5 Cash flow forecasting of project finance
   1. Introduction
      1. Details of project and borrower
   2. Cash flow forecasting
      1. Step one
         1. Observations
      2. Step two
         1. Observations
      3. Step three
         1. Observations
      4. Step four
         1. Observation
   3. Conclusion
10. 6 Pro forma forecasts using AMADEUS electronic databases (1/3)
11. 6 Pro forma forecasts using AMADEUS electronic databases (2/3)
12. 6 Pro forma forecasts using AMADEUS electronic databases (3/3)
13. Appendices
    1. 1 Credit rating agency rating scales
    2. 2 Country risk criteria
       1. Political risk profile
       2. Economic risk profile
       3. S&P’s sovereign rating profile
    3. 3 Summary of lending types
    4. 4 Complete AmaOS spreadsheet (1/2)
    5. 4 Complete AmaOS spreadsheet (2/2)
14. Suggested reading
15. Glossary (1/6)
16. Glossary (2/6)
17. Glossary (3/6)
18. Glossary (4/6)
19. Glossary (5/6)
20. Glossary (6/6)
    1. Profitability indicators
    2. Turnover and efficiency indicators
    3. Financial position indicators
    4. Cash flow terms
    5. Cash ratios
21. Index
    1. A
    2. B
    3. C
    4. D
    5. E
    6. F
    7. G
    8. H
    9. I
    10. J
    11. K
    12. L
    13. M
    14. N
    15. O
    16. P
    17. Q
    18. R
    19. S
    20. T
    21. U
    22. V
    23. W
    24. Y
    25. Z