Table of Contents

  1. Cover
  2. Chapter 1: Company Valuation
    1. Why use a valuation technique?
    2. Who uses valuation techniques?
    3. Wells Fargo “dividend capitalization” model
    4. Dividend computation for privately-held corporation
    5. Review questions
  3. Chapter 2: Ratio Analysis: The Effect Ratios
    1. Effect ratios
    2. Liquidity
    3. Inventory to working capital
    4. Accounts receivables to working capital ratio
    5. Net sales to working capital (working capital turnover)
    6. Operating cash flow to current liabilities
    7. Debt ratios
    8. Current liabilities to net worth
    9. Times interest earned
    10. Net profit to net worth (return on equity)
    11. Effect ratio summary
    12. Review questions
  4. Chapter 3: Analysis of Profitability Using the DuPont Analysis
    1. DuPont system
    2. DuPont system
    3. Total DuPont system
    4. Group exercise – Part A
    5. Group exercise – Part B
    6. EBITDA analysis
    7. Earnings quality
    8. Review questions
  5. Chapter 4: Analysis of Financial Statements Using Causal Ratios
    1. Causal ratios
    2. Fixed assets to net worth
    3. How fixed assets affect profit
    4. Ratios that could be changed by the fixed assets to net worth ratio
    5. Correction procedures
    6. Collection period
    7. Collection period: Example
    8. Ratios that could be changed by the collection period
    9. Correction procedures
    10. Net sales to inventory (inventory turnover)
    11. Net sales to inventory: Example
    12. Ratios that could be changed by net sales to inventory
    13. Correction procedures
    14. Net sales to net worth
    15. Trading ratio: Example
    16. Trading ratio: Example
    17. Ratios that could be changed by the trading ratio
    18. Overtrading characteristics
    19. Correction procedures
    20. The profit margin
    21. The profit margin: Example
    22. Correction procedures
    23. Miscellaneous assets to net worth
    24. Correction procedures
    25. Causal ratio summary
    26. Review questions
  6. Chapter 5: How to Conduct a Financial Statement Analysis
    1. How to conduct an analysis of financial statements
    2. Industry and time series analysis
    3. Sources of industry averages
    4. Problems with using industry data
    5. An example of computing industry statistics from risk management associates (formerly Robert Morris) data
    6. An example of computing industry statistics from Dun and Bradstreet data
    7. Guidelines to use in applying ratio analysis
    8. Review questions
  7. Chapter 6: Case Studies
    1. Case study 1: Paper products company
    2. Case study 2: National west airline
    3. Case study 3: Firm A
    4. Case study 4: Store container corporation
    5. Discussion case 1
    6. Discussion case 2
  8. Chapter 7: Users of Financial Statements
    1. Ratios examined by banks for short-term loans
    2. Ratios examined by banks for long-term loans
    3. Most important financial ratios for commercial loan departments
    4. Commercial loan departments’ ratios appearing most frequently in loan agreements
    5. Corporate controllers’ most significant ratios
    6. Ratios most often appearing in corporate objectives and their primary measures
    7. Review questions
  9. Chapter 8: Forecasting Sustainable Growth
    1. Definitions
    2. Derivation of the sustainable growth model
    3. The Alabama door company
    4. Calculation of Alabama door growth rate
    5. Improving sustainable growth
    6. Sustainable growth: Available external equity
  10. Chapter 9: Forecasting Bankruptcy
    1. Altman’s bankruptcy prediction formula
    2. Bankruptcy prediction example
    3. Altman’s second model
    4. Review questions
  11. Appendix A: CASE PROBLEM
    1. Marine supply company balance sheet
    2. Marine supply company selected income figures
    3. Marine supply company selected financial ratios
    4. Case problem requirements
  12. Glossary of Controllership and Financial Management Terms
  13. Index
  14. Solutions
    1. Chapter 1
    2. Chapter 2
    3. Chapter 3
    4. Chapter 4
    5. Chapter 5
    6. Chapter 6
    7. Chapter 7
    8. Chapter 8
    9. Chapter 9
  15. End User License Agreement

Guide

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