Naked Finance: Business Finance Pure and Simple

Naked Finance: Business Finance Pure and Simple

by David Meckin

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Product Details

ISBN-13: 9781473644823
Publisher: Quercus
Publication date: 05/12/2011
Sold by: Hachette Digital, Inc.
Format: NOOK Book
File size: 6 MB

About the Author

David Meckin is managing director of Insight Financial Consulting and has over 20 years' commercial experience, including as finance director of a multinational. He is a qualified accountant, a Member of the Chartered Management Institute and a Fellow of the Chartered Institute of Bankers. He regularly delivers workshops and presents at conferences internationally, and his clients include FTSE-100 companies and household names worldwide.

Table of Contents

What is Naked Finance?     1
Why do managers need to understand finance?     2
How is this book going to help me?     3
Setting Financial Objectives     9
Is It All About Profit?     10
What does a business need to survive?     10
What is the objective of financial management?     11
What is profit?     13
Is cash flow important?     18
How Do You Make Profit?     20
Where does the profit-making process start?     20
Why do companies need shareholders?     21
Why do companies borrow?     24
Why do companies need assets?     28
Why are companies obsessed with sales?     29
How Do You Measure Financial Success?     32
How do shareholders measure success?     32
How do managers measure success?     38
Are there other commonly used measures of success?     41
Which are the Figures That Count?     46
What are the four key figures in a business?     46
How do the four key figures interrelate?     52
What strategies will enhance the profit-making process?     53
Using Financial Information     59
Why Produce Financial Statements?     60
What is the role of financial statements?     61
What does a balance sheet tell you?     63
What does an income statement tell you?     72
What does a cash flow statement tell you?     82
Where do accounting scandals come from?     85
What Can You Learn from Financial Statements?     90
What is the first thing you should look for?     90
What can financial statements tell you about how a business is being managed?     94
How do financial statements interrelate?     100
How can financial statements be used to help manage a business?     101
What are the danger signals to watch out for?     103
What Can You Learn from the Financial Press?     105
How do you value a company?     106
What determines share prices?     109
How can you interpret the share price information of a publicly quoted company?     111
How do you manage share prices?     121
How do you determine the share price of a privately owned company?     122
How do you value an unincorporated business?     124
How Do You Know if a Company is Being Well Managed?     127
What is shareholder value?     128
How do you know if a company is creating shareholder value?     128
Why is shareholder value important?     134
How can you measure the amount of shareholder value being created?     135
Providing Financial Control     139
How do You Create a Financial Plan?     140
Why have financial plans?     141
What is the difference between a forecast and a budget?     142
Can a budget ever be right?     143
How do you create a budget?     146
How do you agree on a budget?     152
How do You Manage Costs?     156
What drives costs?     156
How do costs affect the relationship between sales and profit?     159
Is there an optimal cost structure for a business?     163
How Do You Manage Sales?     168
How can you ensure that sales will be profitable?     168
How can you plan sales quickly?     170
How can you decide if a sales plan is achievable?     174
How can you evaluate alternative sales strategies?     176
Why do businesses fail to make a profit?     180
How Do You Manage Profit?     182
What can you learn from a budget report?     183
Why does actual profit differ from budgeted profit?     186
Where is management action required?     201
How is management action to be prioritized?     202
How should you use a budget report?     203
What About Cash Flow?     208
What is cash management?     209
What is the link between cash management and profit management?     213
How can you measure cash performance?     214
Is there an optimal cash flow?     218
How Do You Manage Cash Flow?     220
What are the main issues that affect cash flow?     220
How do you manage inventory?     221
How do you manage accounts receivable?     225
How do you manage accounts payable?     227
Should companies maintain high or low cash balances?     228
What About Long-Term Projects?     230
What is a long-term project?     230
How do you argue the case for a long-term project?     232
How do you evaluate the risk of a long-term project?     236
How Do You Decide if a Long-Term Project is Worthwhile?     243
How do you make the accept/reject decision?     244
What is return on investment?     246
What is payback?     249
What is net present value?     252
What is internal rate of return?      258
Summary     261
How Do The Pieces Fit Together?     262
How do you manage a profitable business?     262
A parting thought     267
Index     269

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