Understanding Personal Cash Flow is an ideal course for wealth managers, private bankers, personal bankers, and consumer and business lenders who must evaluate the financial capacity of individuals as borrowers or guarantors.
Understanding Personal Cash Flow begins with a two-module eLearning course that guides participants through the evaluation of personal assets and liabilities, and the intricacies of using the personal tax return to locate, evaluate, and calculate cash flow.
In the first module, participants learn to categorize and evaluate assets, verify liabilities, evaluate contingent liabilities, adjust the borrower’s personal financial statement to reflect the lender’s more-realistic valuations, and assess the overall financial health of the borrower.
In the second module, they learn to use a personal tax return and related K-1s to locate the borrower’s true cash inflows and outflows, and eliminate the noncash pass-throughs that can cloud their evaluation of cash flow.
After learners have successfully completed the eLearning course, they’re eligible to attend Understanding Personal Cash flow: Skills Application Lab, a one-day, facilitated training event during which they apply their skills and knowledge to a complex case study featuring income from salary, investments, farming, patents, a sole proprietorship, an estate, and several business ventures.
In the skills application lab, participants work both individually and in small groups to evaluate the personal financial statement and tax return, determine true net worth, calculate cash flow, project future cash flow, identify strengths and weaknesses, and create a sound loan structure based on their evaluation of the case.
At the end of the day, they’re also challenged to consider various “what if” scenarios and the likely impact they would have on the loan structure.