Building Business Acumen Series Making Dollars and Sense

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Building Business Acumen Series: Making Dollars and Sense of Financial Statements Presented by :

Building Business Acumen Series: Making Dollars and Sense of Financial Statements Presented by : The Dean Consulting Group™ Diane D. Dean Principal December 4, 2007 The Dean Consulting Group™

Outcomes n At the end of today’s session, you will: n n n Be

Outcomes n At the end of today’s session, you will: n n n Be financially literate. Acquire a better understanding of key financial terminology. Reviewed the tools necessary to get a handle on your business finances. Be familiar with the functions of the basic financial statements: balance sheet, income and cash flow statements. Know how to speak the language of and analyze numbers. The Dean Consulting Group™

Accounting methods The Dean Consulting Group™

Accounting methods The Dean Consulting Group™

Components of the Annual Report n Auditor’s Report n Balance Sheet/Statement of Financial Position

Components of the Annual Report n Auditor’s Report n Balance Sheet/Statement of Financial Position n Income Statement/Statement of Activities n Statement of Cash Flow n Notes to the Financial Statements n Manager’s Discussion and Analysis The Dean Consulting Group™

Auditor’s Report n Introductory Paragraph - denotes timeframe of the audit and who is

Auditor’s Report n Introductory Paragraph - denotes timeframe of the audit and who is responsible for the financial statements. This is where the auditor attempts to limit their responsibility for possible inaccuracies. The Dean Consulting Group™

Auditor’s Report n. Scope Paragraph – Explains how auditors carried out the audit and

Auditor’s Report n. Scope Paragraph – Explains how auditors carried out the audit and they met the generally accepted audit standards (GAAS). The Dean Consulting Group™

Auditor’s Report n. Opinion Paragraph – Where the auditors state their opinion about the

Auditor’s Report n. Opinion Paragraph – Where the auditors state their opinion about the financial statements. If there are no problems, they will state "In conformity with generally accepted accounting principles" (GAAP). The Dean Consulting Group™

Balance Sheet The Dean Consulting Group™

Balance Sheet The Dean Consulting Group™

Income Statement The Dean Consulting Group™

Income Statement The Dean Consulting Group™

Statement of Cash Flow The Dean Consulting Group™

Statement of Cash Flow The Dean Consulting Group™

Notes to the Financial Statements n Very important notes listed on various pages after

Notes to the Financial Statements n Very important notes listed on various pages after the financial statements. n It includes: n The accounting methods used n Red flags about the company’s finances n Any legal entanglements that may threaten organization's future. The Dean Consulting Group™

Manager’s Discussion and Analysis (MD&A) n You find in this section key discussions about

Manager’s Discussion and Analysis (MD&A) n You find in this section key discussions about what went well and did not. The Dean Consulting Group™

Manager’s Discussion and Analysis (MD&A) n Three key areas: n Company operations n Capital

Manager’s Discussion and Analysis (MD&A) n Three key areas: n Company operations n Capital resources n Liquidity The Dean Consulting Group™

Channeling Your Inner CSI: Analysis The Dean Consulting Group™

Channeling Your Inner CSI: Analysis The Dean Consulting Group™

Channeling Your Inner CSI: Analysis n MD&A n Financial Statements n Working capital/fund balance

Channeling Your Inner CSI: Analysis n MD&A n Financial Statements n Working capital/fund balance (NFP) n Current Ratio n Gross Margin n Trend Analysis The Dean Consulting Group™

Q&A The Dean Consulting Group™

Q&A The Dean Consulting Group™