Finance for non-financial managers

A little knowledge is a dangerous thing

How much do I need to know?

Non-finance managers have to navigate a world of numbers and jargon when they deal with finance people and it can feel impenetrable.

Loaded with practical examples, we shine a light on the world of business finances, explain the key concepts in plain terms and give you the confidence to understand and engage with your finance colleagues.

Income, expenditure and cashflow – are we making money?

We’ll take an example of a business, look at how it operates every day, week-in, week-out, and ask “what will its numbers look like?”

As the numbers come together we’ll inevitably encounter, explain and demystify some of the jargon finance people use and start to ask questions such as:

  • How much profit is being made?
  • What’s the relationship between the income and the costs of providing the product or service?
  • What are overheads and how are they different from costs of sales?
  • Gross profit v net profit
  • What does its cashflow look like?
  • What could this business do to perform better and how would you measure performance?

Financial strength – what is a balance sheet

Some people struggle a bit with what a balance sheet is but everyone can understand the component parts, the different assets and liabilities, and what they mean to a business.

So we look at the various assets and liabilities that a business may have and explore:

  • How to measure them
  • How they relate to each other
  • How to manage and improve them
  • What happens when liabilities are greater than assets
  • How the assets and liabilities come together to create a balance sheet

Having explored assets, liabilities and balance sheets we’ll look at how and when you might encounter them in your job and with your colleagues.

Margins, mark-ups, break-even and other metrics

 A business only makes a profit when its sales exceed its costs, so how do you set prices to make sure that happens?

We’ll look at:

  • Margins and mark-ups
  • What other costs does the business have that we need to cover?
  • How many items do we need to sell to break even?

We’ll also look at the common financial reports and metrics that the financial world loves and which you might encounter in your job:

  • profit & loss
  • cashflow
  • debtors and credit control
  • budgets and forecasts