Cash flow models are important analytical tools provided as output from business financial statement “spreading” software used for commercial and industrial (C&I) loans. This seminar demonstrates how to compile a statement of cash flows (SCF) as developed by accountants. Using a “hands on” case study, the participants will learn how to calculate SCF formats, plus how to use them to evaluate business cash flow in conjunction with traditional ratio analysis.
Topics to be covered:
- The evolution of SFAS 95 and how the SCF is compiled by accountants
- Compare and contrast the “direct” format from the “indirect” format (both used in SCF)
- How to calculate and how to use the SCF to evaluate business cash flow, with particular focus on assessing operating cash flow consistency and reliability, plus how short-term and long-term financing affect cash flow
- How cash flow analysis can be integrated into and validate traditional ratio analysis and other underwriting techniques
Target Audience: Commercial lenders, credit analysts, small business lenders, private bankers, loan review specialists, lending managers and credit officers