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Financial Management for the Professional Engineer

System Requirements for Viewing

INSTRUCTOR: David M. Wahby

Course Length: 10 Hours

Purpose and Background

Learning to evaluate financial performance through interpretation of income statements, balance sheets, cash flow statements, and project reports is critical to your personal success as well as the success of a business. This course teaches the design professional how to read and interpret the income statement, including such components as gross revenue, net revenue, direct and reimbursable expenses, indirect expenses, net profit before taxes, depreciation, gross profit and net profit after taxes. It examines the primary benchmarks of performance: multiplier, utilization rate, direct personal expense ratio, and overhead. In addition, the course examines the balance sheet components of assets (current, fixed and other), liabilities (current and long-term loans), and stakeholder equity.

Course Outline

  • How To Understand Financial Statements
    • Income Statement
    • Balance Sheet
    • Forms of Business Organization
    • Accrual vs.Cash
  • Key Performance Measures
    • Utilization and Chargeability
    • Overhead Rate
    • Effective Multiplier
    • Current Ratio – Debt to Worth –Working Capital
  • Company Budgeting
    • Labor Budget
    • General and Administrative Budget
    • Revenue Budget and Forecasting
    • Capital Budgeting
  • Project Management
    • The Project Manager’s Job
    • Budgeting and Tracking
    • Finding Problems Before It’s Too Late
    • Skill Sets for Effective Project Managers
  • Finding Your Firm’s Value
    • Book Value vs. Fair Market Value
    • Revenue Based Approaches
    • Profit and EBITDA Measures
    • Goodwill Determinates
    • Contrast Between Inside and Outside Buyers