FINANCIAL MANAGEMENT FOR ENGINEERS AND PROJECTS SEMINAR

Course Summary

This is a Two Day course worth

  • 2 CPD points

This course will have delegates learn how to read, interpret and extrapolate financial statements, they will be able to understand how an organization is measured by financial ratios and how a large project may impact on these.
You will also look at Return on Equity (ROE), Return on Investment (ROI) and the Dupont Analysis. Getting to grips with the Investment Decision:

In a large project, the concept of profit and loss is too unsophisticated to determine whether a project should be invested in. We look at all the financial hurdles a project must overcome before being approved – the time value of money, the Weighted Average Cost of Capital (WACC), predicting cash flows of a project and the actual scoring tools: payback period, Net Present Value (NPV), Internal Rate of Return (IRR) and the Profitability Index (PI). Delegates will also gain a large amount of MS Excel Advanced Skills (not much prior skill is required).

Some of the things we will look at are advanced tabling and charting techniques, the scenario manager and conditional formatting. We also work with a number of functions such as linest, slope, intercept, round, match, index, iferr, pmt, ppmt, npv and irr.

The Speaker

Johan Bosman holds degrees in both law and financial management. During his management career he was a lieutenant-colonel in the South African Police and subsequently CEO of a number of companies in South Africa, Tanzania and Nigeria. He is now a full-time trainer and bases his training on his personal experience with emphasis on the aspects that had made his management career so successful. Some of his training fields include financial management, applied law, diversity, psychological communication skills and general management skills. He is popular in the classroom and is serious about the quality of skills he leaves behind. Johan is a founder member of the Southern Africa Professional Trainers' Association (SAPTA).

Course Details

DAY ONE

MORNING SESSION

UNDERSTANDING FINANCIAL STATEMENTS

  • The Income Statement
  • Cost of Goods Calculation
  • The Balance Sheet
  • Cash Traps
  • Problems with GAAP

ALIGNING PROJECTS WITH STRATEGY

  • Concepts Explained
  • The STO Model
  • Problems with Strategic Plans
  • The Balanced Scorecard: Levels & Mechanics
  • Balanced Scorecard Example
  • The Weighted SWOT Ananlysis
  • Case Study
AFTERNOON SESSION

ENRICHING THE ORGANIZATION ( RATIO ANALYSIS )

  • Ratios Explained
    • Profitability Ratios
    • Liquidity Ratios
    • Efficiency Ratios
    • Gearing Ratios
    • The DuPont
  • Building a Ratio Analysis Tool with MS Excel
  • Building a Common Size Indicator with MS Excel
  • Published Statements and Ratios
  • Warning Signals in Financial Reports
  • The Danger of the Percentage Budget
  • Case Study

WHEN IS A PROJECT VIABLE? (THE INVESTMENT DECISION)

  • Why Invest in a Project?
  • Definitions
  • The Time Value of Money
  • Financing the Project
    • Sources of Financing
    • What the Bank Requirements (The 4C’s of Banking
    • PMT and PPMT Functions
    • Build a Repayment Calculator
    • Build an Amortization Table with MS Excel
  • Steps to Determine Project Viability
    • How to Calculate the Weighted Average Cost of Capital (WACC)
    • How to Calculate Cash Flow with Excel’s Scenario Manager
  • Evaluation Methods
    • Payback Period
    • Calculating Cash Flow
    • Net Present Value (NPV)
    • Internal Rate of Return (IRR)
    • Benefit Cost Ratio (BCR)
  • Build a Project Evaluator with MS Excel
  • Case Study

DAY TWO

MORNING SESSION

CREATING DASHBOARDS, TABLES & CHARTS

  • Tables
    • Creating a Named Table
    • Using Table Styles
    • Conditional Formatting
    • Spark-Lines
  • Charts
    • Creating Normal Charts with Flair
    • Creating a Gauge Meter (”Speedometer”)
    • Steps to Export Chart to Other Applications
  • Case Study

EARNED VALUE MANAGEMENT (EVM)

  • The Building Block
    • Planned Value (PV)
    • Earned Value (EV)
    • Actual Costs
  • Performance Indices
    • Cost Performance Index (CPI)
    • Schedule Performance Index (SPI)
  • Future Forecast Estimates
    • Final Total Cost Prediction
    • Final Total Time Prediction
  • Building an EVM Tracker with MS Excel
  • Case Studies
AFTERNOON SESSION

FORECASTING COST WITH MS EXCEL AND STATISTICS

  • Steps in the process
  • Cost Behaviour Explained
  • Driver Explained
  • Example of a Formula Budget
  • Statistical Terms Explained
  • Testing Correlation
    • Scatter Charts
    • The Person Coefficient
  • Calculating Cost
  • Simple Regression
  • Case Study

COST-VOLUME-PRICE ANALYSIS (CVP)

  • Cost Behaviour
  • The CVP Graph
  • Price Setting
  • The Breakeven Formula
  • MS Excel: Using the Seek Goal Technique
  • The Monte Carlo Simulation

CULMINATING CASE STUDY

Who Should Attend?

  • Engineers
  • Project Managers
  • Construction Managers
  • New Executives
  • Engineering Supervisors
  • Civil Engineers
  • Senior Management
  • Directors, Executive Officers
  • Human Resource Managers
Course Accreditations