Capital Budgeting Analysis

Capital Budgeting Analysis

 Course Description


This course describes how requests for capital investments are documented and examined. It also covers the primary methods for determining whether a proposed investment is acceptable, as well as a number of strategic considerations. Lease or buy financing options are also discussed, along with a system of capital budgeting controls.

Objective

  • This course covers project evaluation, allocation and management of capital assets, rates of return and costs of capital, debt- equity balance and impact on share prices, and long-term profit planning.
  • Examines capital investment decisions including cash flow analysis, tax effects, project evaluation and ranking. Capital rationing, and the treatment of uncertain cash flows.
  • This course is proceeded through numbers of presentations and discussions on different issues on capital budgeting. In so doing, students are trained to have an overview on broad topics, which could be incorporated into their future research.

Who Should Attend

Every manager with budget responsibilities who is interested in developing or improving their budget planning skills

Outline


  • Budgeting and planning
    • The budget and the functions of management
    • Budget as a planning tool
    • Budgets and the key financial statements
    • The Top-down versus bottom-up process
  • Budget cycle, process and approaches
    • The budget cycle
    • Characteristics of successful budgeting
    • Making the budget a value-adding activity
    • Top ten problems with budgeting
    • Choosing the proper budgeting approach:
      • Incremental budgeting
      • Zero-based budgeting
      • Flexible budgeting
      • Kaizen budgeting
      • Activity based budgeting
      • Rolling (continuous) budgets and forecasts
    • The master budget and its components
    • Operating and capital budgets
    • Best practices in budgeting
    • Creating a user friendly budget template
  • Forecasting techniques
    • Forecasting models
    • Qualitative and quantitative methods
    • Steps in developing forecasting models
    • Time series and trend analysis
    • Data conditioning techniques
    • Exponential smoothing and moving averages
    • Simple and multiple regression analysis
  • Advanced capital budgeting evaluation techniques
    • Business risk and cost of capital
    • Classifying investment projects
    • Cash flow estimation
    • Analyzing investment and operating cash flows
    • The time value of money concept
    • The required rate of return
    • Net Present Value (NPV)
    • Internal Rate of Return (IRR)
    • Multiple internal rates of return
    • Modified Internal Rate of Return (MIRR)
    • Profitability Index (PI)
    • Payback period and discounted payback period
    • Capital rationing
    • Comparing and evaluating techniques
    • Sensitivity and risk analysis
  • Breakeven analysis and optimization techniques
    • Cost Volume Profit (CVP) analysis
    • Using CVP to reach a target income
    • Single product and multiple products breakeven analysis
    • Working with budget constraints
    • Building optimization models

 

 

 

 

Certificates

A Certificate of Completion will be issued to those who attend & successfully complete the programme.

Schedule

  08:30 – 10:15 First Session

 10:15 – 10:30 Coffee Break

10:30 – 12:15 Second Session

 12:15 – 12:30 Coffee Break

12:30 – 14:00 Third Session

 14:00 – 15:00 Lunch

Training Methodology:

This interactive training course includes the following training methodologies as a percentage of the total tuition hours:

  • 30% Lectures, Concepts, Role Play
  • 30% Workshops & Work Presentations, Techniques
  • 20% Based on Case Studies & Practical Exercises
  • 20% Videos, Software & General Discussions
  • Pre and Post Test

Fees

 The Fee for the seminar, including instruction materials, documentation, lunch, coffee/tea breaks & snack is: