After successful completion of the course, students are able to:

• Understand the interrelationships between Balance Sheet, Income Statement and Cash Flow Statement and the working of Financial Performance Management & Budgeting Systems by investigating the SteelCo case study
• Apply different forecasting methods (e.g. time series analysis for trend extrapolation and causal analysis in form of Percentage-Of-Sales method) in the budgetary planning and control systems
• Calculate and assess the impact of future related uncertainty by performing sensitivity, scenario and Monte Carlo simulation studies
• Understand the alignment of supply and demand in the Sales & Operations Planning (S&OP)
• Know the task a Financial Planning & Analysis (FP&A) manager is responsible for
• Set up a budgetary planning and control in a real case context by reconstructing the approaches applied in the SteelCo case study
• Set up an enterprise risk management system to identify and manage the company’s key risks

• Income Statement: Modeling and forecasting future operational and financial profit via time series and causal models
• Balance Sheet: Modeling and forecasting via integrating investment and financing policies
• Cash Flow Statement: Modeling and forecasting cash flows from operating, investing and financing activities
• Financing Covenants: Modeling and forecasting future developments of Quick Ratio, Leverage and Interest Coverage
• Business Valuation: Calculating market stock prices via Discounted Cash Flow (DCF)
• Planning of Future Performance Uncertainty: Sensitivity Analysis, Scenario Analysis, Monte Carlo Simulation, …
• Enterprise Risk Management: Identifying, analyzing, and managing key risks with focus on strategic elements in companies and markets
• Risk of changes in financial performance: Analyses of changing cash flows due to a set of risks
• Set up an enterprise risk management system to identify and manage the company’s key risks

Imagine, you are hired by a stock-market traded company as an assistant of the chief financial officer (CFO) with three responsibilities: 1) You forecast and analyze the future financial performance of the company. 2) You implement a discounted cash flow model for calculating the company’s stock price and determining the market implicit growth rate. 3) You assess the different types of risks that are associated with the company’s uncertain future and you are integrating them into the company’s enterprise risk management system.

In this course you acquire the needed knowledge, skills and competences for performing these tasks by discussing the key concepts and by applying them in group work for a specific company.

In "Risk-based Performance Management" the focus lies on predictive analytics in the forecasting, budgetary planning and control as well as enterprise risk management domain.

• Participation and group work
• Project assignment
• Final exam

You can find the literature in TUWEL

• Budgetary planning and control systems
• Proactive double loop management systems