Course Overview

Analyzing Business Tax Returns has been designed to teach bank personnel how to understand tax concepts relating to various business entities and the use of tax returns to help in estimating the customer’s ability to service debt. This fundamental program consists of estimating cash flow from tax returns and determining how taxes influence cash flow and the customer’s operations.

     

Duration

7.5 hours

Delivery

Instructor-Led Online

Program Level

Foundational

 

Prerequisites

None

 

 

Who Will Benefit?

This course is designed primarily for those who lend to individuals and small businesses. However, all financial professionals who need to increase their understanding of income tax returns and cash flow will benefit from this course.

   

Learning Objectives

Upon completion of this course, participants will be able to:

• Identify key differences between financial statements and tax returns.
• Identify the characteristics, advantages, and disadvantages of C corporations, S corporations, partnerships, and LLCs.
• Follow the steps of the cash flow estimation process.
• Identify key content in tax forms relevant to credit and cash flow analysis.
• Apply fundamental tax principles.
• Estimate cash flow from business activities. 
• Estimate debt service coverage.
• Make appropriate adjustments to estimate future cash flow.

Methodology:

To aid in the process of learning cash flow analysis, participants study three cases. Financial statements, tax return forms, and cash flow worksheets are included as part of the case materials. This course actively involves participants by including large and small group activities and questions to enhance the understanding of cash flow. Participants learn by practice, which in turn increases retention. Learning by practice also facilitates their ability to apply course content when they return to their jobs. The course starts with a C corporation and compares cash flows to S corporations and partnerships. Therefore, deviations from the given sequence of presentations are discouraged.