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Table Of Contents

Part IFoundations
1 Background
Why do you need this book?
The form and logic
The philosophy
Data that makes sense
2 Financial statements
The balance sheet
Balance sheet structure – fixed assets
Balance sheet structure – liabilities
3Balance sheet terms
The terms used
4Profit and loss account
Working data
Part IIOperating performance
5 Measures of performance
Balance sheet layouts
6 Operating performance
Return on investment (ROI)
■return on equity (ROE)
Return on equity (ROE)
Return on total assets (ROTA)
Standards of operating performance
7Performance drivers
Operating performance
Operating profit model
Part IIICorporate liquidity
8Cash flow cycle
Corporate liquidity
The cash cycle
Current ratio
Quick ratio
Working capital to sales ratio
Working capital days
10 Financial strength
Interest cover
‘Debt to equity’ ratio (D/E)
11Cash flow
The cash flow statement
Sources and uses of funds – method
Opening and closing cash reconciliation
Long and short analysis
Financial reporting standards
Part IVDeterminants of corporate value
12 Corporate valuation
Share values
Financial leverage
V chart
Market to book ratio
Growth equilibrium
Application to acquisitions
Part VManagement decision-making
Costing illustration
Break-even (B/E)
Contribution to sales percentage (CPS)
Project appraisal – the problem
Project appraisal – steps to a solution (1)
Project appraisal – steps to a solution (2)
Project appraisal – present value (PV)
Project appraisal – internal rate of return (IRR)
Project appraisal – summary
Approach to valuation (1)
Approach to valuation (2)
Value for the equity shareholders
Discount factor
Terminal (continuing) value
Complete model
18Acquisition analysis
Financial profile of Alpha Inc
Financial profile of Beta Inc
Acquisition – first offer
Acquisition impact on EPS
Shareholder effects – generalized
Summary of effects on shareholders
Revised offer
Relative versus absolute values
SVA models – Alpha Inc. and Beta Inc
Where we focus attention
Operating cost
Appendix 1: Special items
Appendix 2: Companies used in the sample
Appendix 3: Full set of ratio charts from sample companies
Appendix 4: Discounting and compounding tables
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Key Management Ratios, 4th Edition (0273707310)

Key Management Ratios, 4th Edition (0273707310)

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Published by zanzitar

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Published by: zanzitar on May 27, 2012
Copyright:Attribution Non-commercial


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