Kennedy Moran Associates LLC

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Kennedy Moran (KMA)

Credit Training Program

Program Dates, Fees & Registration

Accounting App/Fin. Mkts.

Corp. Fin. & Cap. Mrkts.

Fin. Anal./Credit Metrics

Credit Risk Analysis

Mini Seminars & Cases

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Credit & Risk Analysis

This seminar is conducted over two weeks as two distinct yet related concepts. Enrollment may be in both weeks or just week one as a stand alone course.

Week One: Financial Statement Analysis & Credit Metrics
The first module focuses on the key concepts and techniques needed to identify, quantify and mitigate credit risk in a dynamic market.  Using the tools taught during the Accounting Module and the Corporate Finance & Financial Markets Module, participants are instructed on how to develop comprehensive financial analyses of companies across different industries and geographies.  Emphasis is placed on understanding industry issues and how they impact the ability to succeed in the market.  Financial ratios, debt products, derivative products and their role in the risk assessment and mitigation process are highlighted. 

Week One

Introduction to Credit Risk

  • Framework to Evaluate Risk
  • Risk Types and Management
  • Market Risk/Credit Risk/Operational Risk
  • Capital Allocation Guidelines
  • Basel II
  • Risk Ratings – S&P/Moody’s
  • Risk Frontiers
  • Risk vs Reward
  • Financial Products & Risk Management
  • Credit Default Swaps
  • VAR/Stress Testing

Business & Industry/Management Analysis

  • Business vs Financial Risk
  • Cash Conversion Cycle
  • Critical Success Factors
  • Competitive Strategy
  • Risks and Mitigants
  • Management Analysis
  • SWOT Analysis

Financial Statement Analysis - Historical

  • Ratio Analysis – Application & Interpretation
  • Income Statement Analysis – Quality/Trend
  • Balance Sheet Analysis – Asset Quality
  • Zero Based Working Capital
  • Cash Flow – Calculation and Structure
  • Cash Flow Analysis
  • EBITDA vs Free Cash Flow
  • Seasonality – Short Term Financing
  • Critical Signals Analysis

Credit Metric & Applications – Banks/Corporations

  • Leverage Analysis
  • Liquidity Analysis
  • Coverage Analysis
  • Profitability Analysis
  • Efficiency Analysis

 Corporate Risk vs Financial Institution Risk

  • Analytical Tools
  • Credit Risk Assessment
  • Framework for Analysis
  • Counterparty Risk

 

Week Two: Credit Risk Analysis
The program culminates with the Credit Risk module.  During this module, the analysts are required to draw upon all the tools, concepts and techniques presented in the earlier modules to develop a detailed and persuasive financial analysis highlighting the risks associated with a client.  During this segment, particular emphasis is placed on various techniques and factors necessary to develop a viable financial forecast which is critical to the structure of a deal.  Extensive use of cases, including excel based forecast models, are used to facilitate the learning process. Analysts are required to present and vigorously defend their analysis and deal structure.  In an effort to better prepare the participants for the return to their jobs, analytical tools and current market events and deals will be utilized during this segment to facilitate that return.

Week Two

Value Drivers & Financial Forecasting

  •  Sales
  •  Cost of Goods Sold
  •  Selling General and Administrative
  •  Accounts Receivable
  •  Inventory         
  •  Accounts Payable
  •  Capital Expenditures/Research
  •  Projections Analysis
  •  Debt Capacity & Financial Flexibility
  •  Financing Strategies

Structuring Fundamentals

  • Corporate Structure
  • Credit Agreements
  • Covenants
  • Loan Documentation
  • Asset Quality/Collateral
  • Environmental Risk
  • Guaranty/Keepwell

 

Valuation Techniques

  • Corporate Restructuring Techniques
  • Valuation Concepts
  • Value Drivers/Exchange Ratios
  • Comparables – Market and Transaction
  • LBO Mechanics
  • Merger & Acquisitions

Group Meetings

Each group will prepare a 30 minute PowerPoint presentation along with a written report analyzing the financial condition of a client.  The presentation will be made to a panel consisting of KMA teaching staff and consultants.  The client will be requesting that a maturing loan be rolled into a new facility.  The group will be required to evaluate the merits of this request along with the potential consequences if the loan is not renewed.  In addition to the financial analysis, the groups must provide a potential structure for the deal along with collateral, covenants, and pricing.   


Length
  
Two Weeks

Internal Delivery
  
Kennedy Moran Associates

Evaluation
  

Two examinations, closed book

  • The first exam covers comprehension and familiarity with ratios, calculations and historical income statement, balance sheet, and cash flow analysis
  • The second exam requires the analysis of both historical and forecasted performance, including the above as well as projections analysis, suggested covenants/protection, recommendation, structure and risk grade
  • Other than the calculations, the examinations are essay format and require the analysis of actual annual reports, industry data, and historical/projected financial data.
Program Registration
Thank you for your interest in Kennedy Moran Associates. We want to be as responsive to your needs as possible. To register or ask questions about this course or any other course that we offer, you may:

Call us at (631) 513-9968
E-mail us at billmoran@kennedymoran.com
or click on the registration button to register for a course.

We will respond to you as soon as possible.
 Kennedy Moran Associates LLC
 Rockville Centre, NY 11570