You are previewing The Essentials of Finance and Accounting for Nonfinancial Managers, 2nd Edition.
O'Reilly logo
The Essentials of Finance and Accounting for Nonfinancial Managers, 2nd Edition

Book Description

Based on the bestselling AMA seminar, a nuts-and-bolts guide to the dollars-and-cents issues that drive your organization! As a department manager, the last thing you want to think about is numbers. But the truth is, that’s the only thing your executives and senior managers are thinking about so it’s crucial to understand key financial information like balance sheets, income statements, cash flow statements, budgets and forecasts, and annual reports. With over 40,000 copies sold, The Essentials of Finance and Accounting for Nonfinancial Managers has long provided readers with insight into the financial fundamentals. It demystifies the role accounting and finance play in a corporation, demonstrates how financial decisions reflect business goals, and shows how managers can connect corporate financial information directly to their own strategies and actions. Now revised to reflect new accounting and financial standards, the second edition includes: Strategies for getting your share of the budget • New case studies and practice sessions • An explanation of Sarbanes-Oxley and its relevance to nonfinancial managers • How to manage cash flow in tough times • Fraud detection tools • An expanded glossary including up-to-the-minute business concepts and terminology • And more

Table of Contents

  1. Cover Page
  2. Title Page
  3. Copyright Page
  4. Contents
  5. Introduction
    1. Organization of the Book
    2. Additional Background
    3. Accounting Defined
    4. Generally Accepted Accounting Principles
    5. Financial Analysis
    6. Some Additional Perspectives on the Planning Process
  6. Part 1: Understanding Financial Information
    1. 1. The Balance Sheet
      1. Expenses and Expenditures
      2. Assets
      3. Important Accounting Concepts Affecting the Balance Sheet
      4. Liabilities
      5. Stockholders’ Equity
      6. Total Liabilities and Stockholders’ Equity
      7. Additional Balance Sheet Information
      8. Analysis of the Balance Sheet
    2. 2. The Income Statement
      1. Analysis of the Income Statement
    3. 3. The Statement of Cash Flows
      1. Sources of Funds
      2. Uses of Funds
      3. Statement of Cash Flows
      4. Financial Practice Review
      5. Analyzing the Statement of Cash Flows
    4. 4. Generally Accepted Accounting Principles: A Review and Update
      1. The Fiscal Period
      2. The Going Concern Concept
      3. Historical Monetary Unit
      4. Conservatism
      5. Quantifiable Items or Transactions
      6. Consistency
      7. Full Disclosure
      8. Materiality
      9. Significant Accounting Issues
    5. 5. The Annual Report and Other Sources of Incredibly Valuable Information
      1. The Annual Report
      2. Modern-Day Activists
      3. The 10-K Report
      4. The Proxy Statement
      5. Other Sources of Information
      6. The Securities and Exchange Commission
  7. Part 2: Analysis of Financial Statements
    1. 6. Key Financial Ratios
      1. Statistical Indicators
      2. Financial Ratios
      3. Liquidity Ratios
      4. Ratios of Working Capital Management
      5. Measures of Profitability
      6. Financial Leverage Ratios
    2. 7. Using Return on Assets to Measure Profit Centers
      1. Assets
      2. Revenue
      3. After-Tax Cash Flow (ATCF)
      4. Return on Assets: Its Components
    3. 8. Overhead Allocations
      1. Problems That Arise from Cost Allocation
      2. What About the IRS and GAAP?
      3. Effect on Profits of Different Cost Allocation Issues
  8. Part 3: Decision Making for Improved Profitability
    1. 9. Analysis of Business Profitability
      1. Fixed Costs
      2. Variable Costs
      3. Development of Fixed-Cost Estimates
      4. Development of Variable-Cost Estimates
      5. Breakeven Calculation
      6. Variance Analysis
    2. 10. Return on Investment
      1. What Is Analyzed?
      2. Why Are These Opportunities Analyzed So Extensively?
      3. Discounted Cash Flow
      4. Present Value
      5. Discounted Cash Flow Measures
      6. Risk
      7. Capital Expenditure Defined
      8. The Cash Flow Forecast
      9. Characteristics of a Quality Forecast
      10. Establishing the ROI Target
      11. Analytical Simulations
      12. Comprehensive Case Study
  9. Part 4: Additional Financial Information
    1. 11. Financing the Business
      1. Debt
      2. Equity
      3. Some Guidance on Borrowing Money
    2. 12. Business Planning and the Budget
      1. S.W.O.T. Analysis
      2. Planning
      3. Significant Planning Guidelines and Policies
      4. Some Additional Issues
      5. A Guide to Better Budgets
      6. Preparation of the Budget
    3. 13. Selected Business Readings
      1. Profitability During Tough Times
      2. Do the Right Thing
  10. Appendixes
  11. Glossary
  12. Index