Money related Articulation Examination:.


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Comprehend and Interpret Financial Results for Better Management & Credit ... also, budgetary experts who may distribute appraisals of our money related results will ...
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Money related Statement Analysis: Understand and Interpret Financial Results for Better Management & Credit Decisions Denver – March 30, 2004 Axiomate, Inc.

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Introduction and Understanding Specific Interests Eric Edwards – Axiomate, Inc. Jeff Holben – E 2 Business Services, Inc. What Participants Hope to Get from Seminar Axiomate, Inc.

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Purpose of Class Understand the nuts and bolts of money related presentation Understand where the numbers originate from and what they mean. Prologue to the "craft of bookkeeping" or the goal v. subjective Understand the nuts and bolts of monetary instruments Understand the nuts and bolts of arrangement assessment Axiomate, Inc.

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Our Day Walkthrough the Financial Statements Discuss every real detail: What the number means Source of the number Evidentiary matter behind the number Hard side of number The degree to which the number is OBJECTIVE Soft side of number The degree to which the number is SUBJECTIVE The One Sided Entry For each activity (Dr.) there is an equivalent and inverse response (Cr.) Look at commentaries Walk through the S-1 Turn you lose on the numbers, perhaps Axiomate, Inc.

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Types of Org. Structures Axiomate, Inc.

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What Type of Org. Structure Number of Owners/Shareholders Taxes Liability Cost of Operations Financing Axiomate, Inc.

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Purpose of Financial Statements Used by: Equity Shareholders Banks and Financial Creditors Customers and Suppliers Potential Investors Management and Board Relied upon in picking up solace from danger Axiomate, Inc.

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Purpose of Financial Statements Equity Shareholders Monitoring Investment & Management Banks and Financial Creditors Analyzing Risk For Credit Decisions Customers and Suppliers Analyzing Risk For Credit Decisions Potential Investors Analyzing Risk for Investment Decision Management and Board Business Management/Oversight Axiomate, Inc.

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Purpose - Comfort from Risk Credit Risk Investment Risk Management Risk Employment Risk Purchase Risk Axiomate, Inc.

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Purpose of Financial Statements Offense – Statement preparers Vs Defense – Statement Users (& Auditors) Axiomate, Inc.

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Example Companies Netflix, Inc. (Less complex) Symbol: NFLX (NASDAQ) Total Revenues of $150 million Rapidly developing, entrepreneurial organization Aspen Technology, Inc. (Complex) Symbol: AZPN (NASDAQ) Total Revenues of $320 million Complex, battling organization Core Financial Statements don\'t recount the entire story Axiomate, Inc.

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Guest Company - Netflix (Nasdaq: NFLX) is the world\'s biggest online DVD motion picture rental administration offering more than one million individuals access to more than 15,000 titles. Netflix\'s allure and achievement are based on giving the most broad determination of DVDs, a simple approach to pick films and quick, free conveyance. Axiomate, Inc.

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Elements of A Complete Financial Package Auditors Opinion Balance Sheet Income Statement of Cash Flows Statement of Equity Footnotes Other SEC Disclosures for Public Companies Axiomate, Inc.

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Types of Statements – Accountant Opinions Audit Statements are a reasonable presentment as per GAAP Review Statements exhibited in GAAP, seem reasonable. Arrangement Statements have been sorted out Axiomate, Inc.

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Understanding The Auditor\'s Opinion (the Defense?) Only the Opinion Page Belongs to the Auditors (not our business to get ready explanations) Our work is adequate to have REASONABLE affirmation articulations are free of MATERIAL misquote The Statements arranged on steady premise and Present FAIRLY the money related condition Qualified versus.. Inadequate Axiomate, Inc.

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Auditor\'s Opinion - Unqualified Axiomate, Inc.

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Auditor\'s Opinion - Qualified Qualification Axiomate, Inc.

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Auditors – who do they play for? Reviewers were set up as to some degree a private division police power to maintain bookkeeping respectability. Securities Act of 1933/34 Auditors play out the "Bear witness to" capacity They expect obligation regarding decency & trustworthiness Yet, reviewers are contracted by and paid for by the Company Audit board (Mgmt Control versus.. Free) Through 2000, counseling expenses were lucrative Axiomate, Inc.

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Understanding Company\'s Motivates (the Offense) Financial explanations and references have a place with the organization. Administration utilizes budgetary explanations to recount a story – the way they need to story to be told. Story might be intended for a particular gathering of people. Consider who the gathering of people may be when perusing articulations Financial proclamation presentation is NOT dark & white. Axiomate, Inc.

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Dissecting The Balance Sheet ASSETS Axiomate, Inc.

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Fundamentals of Accounting For each charge, there must be an equivalent and relating credit(s) Axiomate, Inc.

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Liquidity Current Assets Current Liabilities The Balance Sheet Long-Term Liabilities Fixed Assets Equity Section Other Assets Axiomate, Inc.

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The Balance Sheet – Current Assets Also: A/R & Inv Axiomate, Inc.

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Dissecting the Balance Sheet – Left Side Thinking – Current Assets Current Assets Axiomate, Inc.

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Dissecting the Balance Sheet – Left Side Thinking – Current Assets Current Assets Axiomate, Inc.

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The Balance Sheet – Fixed Assets Axiomate, Inc.

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Fixed Assets (Aspen Tech) Axiomate, Inc.

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Dissecting the Balance Sheet – Left Side Thinking – Fixed Assets Axiomate, Inc.

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Dissecting the Balance Sheet – Left Side Thinking – Fixed Assets Axiomate, Inc.

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The Balance Sheet – Intangibles/Other Assets Axiomate, Inc.

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Creating the Intangible (what to do with the charge) Axiomate, Inc.

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Dissecting the Balance Sheet – Left Side Thinking – Intangibles Axiomate, Inc.

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Dissecting the Balance Sheet – Left Side Thinking – Intangibles Axiomate, Inc.

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Dissecting the Balance Sheet – Left Side Thinking – Other Assets Deposits Long-term receivables Deferred Tax advantages Long-term prepaids Axiomate, Inc.

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Dissecting The Balance Sheet LIABILITIES Axiomate, Inc.

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Netflix – Current Liabilities Axiomate, Inc.

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Dissecting the Balance Sheet Right Side Thinking Current Liabilities Axiomate, Inc.

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Dissecting the Balance Sheet Right Side Thinking Current Liabilities Axiomate, Inc.

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Netflix – Long Term Liabilities Axiomate, Inc.

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Dissecting the Balance Sheet – Right Side Thinking Long-Term Liabilities Axiomate, Inc.

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Dissecting the Balance Sheet – Right Side Thinking Long-Term Liabilities Axiomate, Inc.

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Dissecting The Balance Sheet EQUITY/NET WORTH Axiomate, Inc.

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Netflix – Equity Axiomate, Inc.

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Dissecting the Balance Sheet Right Side Thinking Equity Axiomate, Inc.

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Dissecting the Balance Sheet Right Side Thinking Equity Watch stock for … .. Axiomate, Inc.

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Complex Equity (Aspen Tech) Axiomate, Inc.

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Dissecting the Balance Sheet – Important Metrics Axiomate, Inc.

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Dissecting the Balance Sheet – Other Good Metrics Inventory Turnover: Cost of Goods/Inventory turnover days: 365/Inventory Turnover A/R Turnover Sales/Accounts Receivable A/R turnover days: 365/AR Turnover Cash Cycle Add Inventory and A/R days Number of days from item to money Axiomate, Inc.

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Dissecting The Income Statement Axiomate, Inc.

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Income Statement – Revenue – Growth Axiomate, Inc.

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Income Statement – Revenue - Transition Growth No Growth Axiomate, Inc.

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Dissecting the Income Statement - Revenue Types of Revenues Goods Sold (Sales) Fees Subscriptions Rents Software Licenses Maintenance Gross versus.. Net Project Revenues/Progress Billing When to Recognize/Record Axiomate, Inc.

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Income Statement – Revenue – Growth Axiomate, Inc.

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Dissecting the Income Statement – Cost of Goods Axiomate, Inc.

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Dissecting the Income Statement – Cost of Goods Direct Cost of Revenue Cost of Sales versus.. Working Expenses Should Cost of Sales all be variable? Distribution of Fixed Expenses to divisions/classes Axiomate, Inc.

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Aspen Tech – Operating Expenses Axiomate, Inc.

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Dissecting the Income Statement – Operating Expenses Types of Expenses – Allocation Discretion Sales and Marketing Advertising, Sales compensations/commissions, T&E Research & Development Salaries General & Administrative Rent, Supplies, Utilities Other Operating Expenses/Non-repeating/Special Cash versus.. Non-Cash Capitalized Expenses/Amortization Axiomate, Inc.

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Operating cost – another methodology Axiomate, Inc.

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Dissecting the Income Statement – Below the Line Interest & Investment Income/(Expense) Extraordinary Items Minority Interest New Reconciliations Axiomate, Inc.

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Dissecting the Income Statement – Important Metrics & Terms Gross Margin/Contribution Margin Operating Margin/Return of Sales Industry Specific Measures Sales & Marketing/Revenues R&D/Revenues G&A/Revenues EBITDA Axiomate, Inc.

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Aspen Tech Comparative Income Statement Axiomate, Inc.

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Aspen Tech Income Statement Trend Analysis Axiomate, Inc.

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Taking a Bath What organizations/CFO\'s will do in terrible years Positioning to oversee income in great years Sometimes, they will "benefit" from the bathwater Many cleaned up in 2001/02 Axiomate, Inc.

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Dissecting The Statement of Cash Flows Axiomate, Inc.

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What is Cash? Money is the cash that a man really has, inclu

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