The Importance of Cash Flow and How to Forecast Cash Flow
Ron has over twenty five years in credit management in the clothing, door and window manufacturing, wine and now the medical device industry. He holds a BS in Accounting and has received his certification in credit and finance from the Amos Tuck business school at Dartmouth University. Ron has been in instructor for NACM for 18 years teaching both the CAP and ACAP classes helping over 150 credit people prepare for their credit designations. Ron is currently the Credit Manager at CooperVision Inc, a $2B Global medical device company. Ron has been honored with the following awards for his efforts in giving back to the credit community; NACM National instructor of the year 2010, Credit Executive of Upstate NY in 2011 and the NACM CCE award of Excellence in 2013.He has a passion for his profession and is continually looking to share his knowledge so other can grow theirs.
Why is the Statement of Cash Flows so important and what will you learn from analyzing it. In this session, you will learn about the three parts of the Statement of Cash Flows and we will break each one down accordingly. You will understand that a company can show their sales increasing every year and also show they are making profits. However, if they cannot generate cash flow from their daily operations they will go BANKRUPT. You will also learn a method of how to forecast cash each month for your company and learn to forecast your number within 5% each month.
- Understanding the importance of generating cash flow
- Looking at what can happen to a company that does not generate cash
- Learning how to analyze the Statement of Cash Flows
- Learn how to forecast cash on a monthly basis for your company and be accurate
- Understand the difference between a source of cash and use of cash
- Understand where each cash transaction is placed on the Statement of Cash Flows
Who Should Attend
If you are making loan decisions for your company, extending credit to customers, buying your own stocks in companies, or even looking for employment, learning how to read a Statement of Cash flows will benefit each of you. If you are an owner of a company and are more sales orientated then hearing this session will help you understand that increasing sales and profits each year is important but so is generating cash from operations.
Why Should You Attend
For many years prior to the decade of 1980s and 1990s, most companies in their evaluating of credit were just concerned about if a company was generating a profit and growing sales. If so they approved them for a credit line. However, once companies started to use debt as a way of growing (LBO’s) the entire situation changed as cash was now so important so that these companies could not pay back their debt. Add to that the corporate scandals of Enron and MCI and now everyone was scared. By starting to use the Statement of cash flows as an integral part of the credit analysis process the expression “Cash is King” got its start and it has been a key metric ever since.