Finance for the Supply Management Professional

There is one area of business that every Supply Management Professional wants more information on & understanding of: Finance. This 2-day program provides you all the tools you need to confidently deal with your finance staff. From terminology to best practices to examples to hands-on practice, this c ourse has it all.

What You Will Learn
• A proven set of decision-making tools and financial techniques
• To use these techniques to communicate purchasing’s contributions
• How to effectively evaluate suppliers’ financial status
• How to apply modern financial practices to purchasing
• How to build a convincing case study for decision making

Who Should Attend
Purchasing professionals who want to learn about the relationship between finance and procurement
and master and/or revisit the advanced concepts of the financial side of the purchasing/procurement
• Financial professionals
• Operational managers
• Operational process owners
• Project managers
• Anyone tasked with the effective and efficient evaluation of potential investments, acquisitions,
outsourcing agreements, or long-term contracts 
• Also this program is for those responsible for the making or evaluating management of a decision-making process and want to more effectively use Excel® and an analytical tool

Program Agenda

SESSION 1 Introduction to Accounting & Finance
• What is Accounting
• What is Finance
• How does Finance differ from Accounting
• What are the differences between Financial Accounting and Management Accounting?
• Case study of a supplier’s financial statements

SESSION 2 Financial framework
• Management views and perspectives
• Purchasing's impact on financial statements
• Procurement - planning, forecasting and budgeting
• Opportunity and risk analysis
• Case study for Purchasing’s Decision Model

SESSION 3 Finance and Accounting relationship
• Basic financial statements
i) Balance Sheet ii) Income Statement iii) Cash Flow Statement
• Non Cash Deductions & its Impact
i) Depreciation vs. Amortization vs. Depletion
• Book Value vs. Market Value
• Financial vs. Management Accounting
• Case study of a ROE, ROA & ROI calculations
• Finance Simulation to use what you have learned

SESSION 4 Cash flow analysis & why is it important
• Dynamics of cash flow
• Cash Management vs. Working Capital Management
• Operating Cycle vs. Cash Cycle
• Cash forecasting using a Cash Budget
• Case study to analyze Supplier’s cash flow

SESSION 5 Procurement ratios and formulas
• What are Ratios & why are they important
• Period costs vs. Product costs
• Discount & Payment terms
• Mark-ups vs. mark-downs
• Altman Z-Score
• Case study to calculate the probability of Supplier Bankruptcy
• What is the value of the Economic Order Quantity (EOQ)
• Suppliers Benchmarking model
• Case study to Compare Supplier ratios to industry

SESSION 6 Total Cost of Ownership (TCO)
• How to define TCO
• What do we need to calculate TCO
• Costs: Fixed vs. Variable & Tangible vs. Intangible
• Supplier Sourcing model
• Supplier Alternative Model
• Case study to calculate the better choice between two Suppliers

**Each participant will receive an Excel workbook of the case study templates (10+) to be worked through during the program