Essential Accounting for Investment Bankers Part 2

Perhaps the most annoying modeling mistakes that can be made by an investment banking analyst is “balance sheet off-balanced”. A rigourous understanding of the building blocks of a balance sheet is crucial in testing a candidate’s grasp on financial accounting. This is the motivation behind Part 2 of the GIUP Essential Accounting for Investment Banking Analyst handbook series - making this series a very valuable additional into our educational range.

Part 2 of this GIUP Handbook series continues the journey from Part 1, and provides:

â—¦A great introduction to the balance sheet specifically designed for I-Banking applicants, focusing on its basic structure and its intricate connection with the income statement and cash flow statement.
â—¦A detailed introduction of each individual balance sheet line item, their definition and the purposes they serve in a balance sheet statement.
â—¦An overview of the different types of debt and their classifications.
â—¦An introduction to the concept of 'Working Capital' and 'OWC (Operating Working Capital)', explaining the methods we use to calculate it and the significance that the change in OWC represents in real business scenarios.
â—¦An insight into the key performance indicators for Working Capital.
â—¦A detailed discussion on the BASE Analysis for PP&E by going through complete and comprehensive case examples.
â—¦We introduce the key performance indicators such as CAPEX and Depreciation and the hidden meaning behind these metrics for a real business situation.
â—¦Introduction to BASE Analysis for Retained Earnings.

This handbook is ultimately a very practical illustration of how the balance sheet can be “balanced” and the significance of its balanced status as well as a summary of the contributing factors involved in reaching such an equilibrium witihn the presentation of a company's financial activity.