Corporate finance and FP&A: applied workshop

Finance and business drivers

Use finance and business drivers to make decisions inspectable.

Distinguish accounting, budgeting, business analysis and treasury.

Teaching example: Growth can increase both revenue and cash needs.. Predict the result, independently check the key step, and compare these assumptions with the actual role. Do not use demonstration results as real-world advice.

Fixed and variable costs

Use fixed and variable costs to make decisions inspectable.

Classify costs using stated assumptions.

Teaching example: Rent may be fixed within a period but increase at capacity thresholds.. Predict the result, independently check the key step, and compare these assumptions with the actual role. Do not use demonstration results as real-world advice.

Driver-based budgeting

Use driver-based budgeting to make decisions inspectable.

Build a monthly budget driven by volume, price and cost.

Teaching example: Revenue is volume times price; variable cost changes with volume.. Predict the result, independently check the key step, and compare these assumptions with the actual role. Do not use demonstration results as real-world advice.

Variance analysis

Use variance analysis to make decisions inspectable.

Compare actuals with budget and separate price and volume effects.

Teaching example: Budget 100 and actual 90 give a revenue variance of −10.. Predict the result, independently check the key step, and compare these assumptions with the actual role. Do not use demonstration results as real-world advice.

Cash forecasting

Use cash forecasting to make decisions inspectable.

Build a cash forecast using receipt and payment dates.

Teaching example: Expense recognition can differ from cash payment timing.. Predict the result, independently check the key step, and compare these assumptions with the actual role. Do not use demonstration results as real-world advice.

Capital investment appraisal

Use capital investment appraisal to make decisions inspectable.

Compare cash flow, present value and sensitivity in a fictional project.

Teaching example: Initial outlay and later cash flows need one consistent timeline.. Predict the result, independently check the key step, and compare these assumptions with the actual role. Do not use demonstration results as real-world advice.

Business partnering

Use business partnering to make decisions inspectable.

Recommend one action supported by variance evidence.

Teaching example: Investigate volume drivers before recommending a price cut.. Predict the result, independently check the key step, and compare these assumptions with the actual role. Do not use demonstration results as real-world advice.

Worked example · fictional

From a problem to inspectable work

Synthetic budget: standard variable cost 30/unit; actual output 1100 and actual cost 33/unit; original output budget 1000.

1. Actual 36300 minus flexible standard 33000 = 3300. Comparing with static 30000 mixes in volume effects.
2. Further judgment: Costs exceed the static budget. Is inefficiency established?
3. Separate volume, price, usage and one-time factors

Deliver budget and operating variance analysis: the calculation reference is 3300; the recommendation must respect Separate volume, price, usage and one-time factors. Separate numbers, inference and unknowns.

Failure case and repair

In Variance analysis, copy tool output without definitions, then retain the conclusion when asked: Costs exceed the static budget. Is inefficiency established?

Even a result of 3300 does not explain when Separate volume, price, usage and one-time factors is supported.

Actual 36300 minus flexible standard 33000 = 3300. Comparing with static 30000 mixes in volume effects. Then test assumptions in Capital investment appraisal.