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All lawyers – cross practice

Some of the suggested courses are set out below. If there is any particular area of interest that is not covered please contact us.

1. Understanding financial statements

Objectives

  • To provide a practical understanding of financial jargon in company accounts and to increase the confidence of delegates when reviewing financial statements as well as using these terms in legal documents.
  • To give delegates a thorough understanding of how the numbers are derived in the financial statements and of how Accounting Standards sometimes allow more than one option.
  • To allow delegates to interpret simple financial statements and identify key information about a company or group of companies

Content

  • Why do lawyers need to understand financial statements?
    • Typical legal transactions involving the use of financial statements
  • Types of financial information you are likely to encounter in your work as lawyers
    • Annual financial statements
    • Management accounts
    • Group or individual accounts
    • Special purpose accounts
  • Brief introduction to different accounting regimes and generally accepted accounting practices (GAAP)
    • Different GAAPs
      • IFRS, UK GAAP, US GAAP and other national GAAPs
      • How they differ and why this matters
      • Why this is important for lawyers
  • What are accounting principles, policies and estimates
  • Key components of a set of IFRS financial statements including:
    • What is included and why
    • Overview of income statement, statement of financial position and statement of cash flow
    • How to analyse each of these statements including how they interact and what they are telling us about an entity
    • What is profit and why it may be different from reported cash (the “accruals” principle)
    • What the notes to the financial statements can tell us
    • An approach to reading a set of financial statements
  • How the accounts reflect the business model

Course Types

In house courseIn house
E Learning courseE-Learning
Face to Face courseFace to Face
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2. Evaluating companies using financial statements – Key financial ratios

Objectives

As a result of this session participants will:

  • Be able to use a set of financial statements to analyse an entity’s profitability, efficiency, liquidity and leverage by:
    • Calculating and analysing a variety of commonly used financial ratios
    • Appreciate how these ratios can be affected by accounting standards
    • Be aware of some of the limitations of ratios

Content

In this course we will use a case study entity and its IFRS financial statements over a four year period to analyse the entity’s performance, efficiency, liquidity and leverage

  • Reminder of what is included in a set of financial statements
  • Use the narrative reports to set expectations
  • Do the financial ratios confirm the narrative reports’ “story”?
    • Assessing the entity’s performance and profitability
      • 3 key questions to answer:
        • Is the entity being well run?
        • How is it performing and is the performance improving or worsening?
        • What can the financial statements tell us about future performance?
  • Profitability and returns
    • Ratios to calculate, why we calculate them and what the analysis can tell us
      • Margins
        • Gross, Operating, EBITDA, Net
      • Free cash flow
      • Return on assets
      • Return on equity
      • Return on capital employed
  • Efficiency
    • How efficiently are we using our assets and managing our liabilities?
    • Ratios to calculate and analyse
      • Inventory days
      • Trade receivable days
      • Trade payable days
  • Liquidity
    • Can the entity meet its short term/near term obligations?
    • Ratios to calculate and analyse
      • Current ratio
      • Quick ratio
  • Leverage
    • Is the entity financed through debt or equity and why does this matter?
    • Does the entity have long term solvency issues?
    • Ratios to calculate and analyse
      • Gearing (debt to equity ratio)
      • Interest cover
  • What other information can be identified by looking at financial statements
    • The most important notes in a set of financial statements
  • Conclusions

Course Types

In house courseIn house
Face to Face courseFace to Face
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3. Six things lawyers need to understand about financial statements

Objectives

By the end of this session participants will be more confident in:

  • Navigating and understanding published financial statements
  • Using and understanding common accounting jargon
  • Identifying and extracting key information from published financial statements

Content

We will use a set of published IFRS financial statements to introduce and explain:

1. Key components of annual financial statements

  • Overview of the primary financial statements
  • Suggested approach to reading a set of financial statements.
  • A reminder of what is profit, how profit and cash may be different (accruals concept) together with what is not included in a set of financial statements

2. Basis of accounting: Accounting regimes

  • Full IFRS, jurisdiction specific versions of IFRS, UK GAAP, US GAAP and other National GAAPs
  • Benchmark standards of preparation (true and fair or fair presentation)

3. Accounting principles and policies

  • What are the core accounting principles, accounting policies and accounting estimates
  • What are the implications of changes in policies and estimates and how will they be disclosed

4. Audit reports: unmodified and modified reports and emphasis of matter paragraphs

  • What they are and when they are used. What other information can we obtain from the audit report?

5. Types of accounts: Entity versus group accounts

  • The key features of each, the basic accounting principles governing the accounting for a group

6. Events after the reporting date

  • What the financial statements tell us about events between the year end and the date of approval and beyond

Each topic will conclude with ‘why it matters to lawyers’.

Course Types

In house courseIn house
Face to Face courseFace to Face
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4. Focus on accounts

Introduction

Four short sessions covering key areas in the financial statements. Each session is available as an e-summary, a webinar and/or a face to face session. The e-summaries are approximately 20 minutes long and can be accessed on a worldwide basis by any number of users at any time. They are based on IFRS and will be complemented by a live webinar using real examples which will be run twice a year for people to listen to and ask questions live to the presenter. Each webinar will be run twice in the day to take account of time differences across the world. An overview of each session is below.

Content

Topic 1: Liabilities, provisions and contingent liabilities

  • What a liability is according to the International Financial Reporting Standards, or IFRS
  • What are the more common liabilities
  • When are liabilities recognised in the statement of financial position and when are they not
  • How are liabilities measured

Topic 2: Working capital

  • What is working capital
  • Why is it so important to entities
  • The potential for differing working capital requirements in different entities
  • What lawyers need to consider when negotiating working capital

Topic 3: Consolidation

  • How accountants determine whether or not to produce group accounts
  • How accountants define subsidiaries, associates and investments in accordance with IFRS
  • What the process is when producing consolidated accounts
  • How accountants will account for subsidiaries, associates and investments

Topic 4: Statement of cash flow

  • Why is the statement of cash flows so important and why is it produced
  • The four critical questions that need to be answered in relation to cash flow
  • How the statement of cash flows is presented and produced under IFRS
  • What conclusions can be drawn from reviewing the statement of cash flows

Course Types

In house courseIn house
E Learning courseE-Learning
Face to Face courseFace to Face
WebinarWebinar
ENQUIRE NOW
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