Level I - Differences in Business Organizations

Target Audience

This workshop is for all beginning credit analysts and lenders. It may be appropriate as a refresher for more experienced analysts and lenders.

Level I
111		The Language of Business
121		Differences in Business Organizations
131		Financial Statement Quality

Course Objectives

	Provide a clear understanding of the differences in the structure and composition of financial statements for Subchapter C corporations, Subchapter S corporations, partnerships, limited liability companies, and sole proprietorships;
	Explore and understand the purpose and intent of distributions and withdrawals and the manner in which they are recorded in the financial statements;
	Identify the amount of distributions and withdrawals that exceed the implied personal income tax obligation and, therefore, potentially impact reported operating profit;
	Understand the importance of adjusting for distributions and withdrawals in calculating and assessing key performance ratios and indicators, especially bottom line profit;
	Understand the proper calculation of key performance ratios, especially to account for the impact of distributions and withdrawals on critical profitability measures; and
	Examine and appreciate the differences in owner composition, in owner income tax obligations for company profit, and in owner liability for company debt obligations across the range of business organizations.

6 CEUs

Course Materials

	Note on Business Organizations and Understanding the Numbers
	Note on Key Ratios and Risk Assessment
	1998 Financial Statements for Gemini Press, Inc.
	1998 Financial Statements for Gemini Press Partners
	2001 Financial Statements for Information Access, Inc.
	Exercise Set (downloaded from Shockproof! Training website)
	Online Review Quizzes
	Solution Set (downloaded from Shockproof! Training website)
	Access to the Shockproof! Training Resource Center
	Inclusion in the Shockproof! Training Discussion Forum
	Online Credit Skills Proficiency Exam

Upon Completion

Participants who successfully complete the workshop will be able to:

	Identify the differences in the structure and composition of financial statements for Subchapter C corporations, Subchapter S corporations, partnerships, limited liability companies, and sole proprietorships;
	Understand and assess the purpose and intent of distributions and withdrawals and the manner in which they are recorded in the financial statements;
	Calculate the amount of distributions and withdrawals that exceed the implied personal income tax obligation and, therefore, potentially impact reported operating profit;
	Adjust for distributions and withdrawals in calculating and assessing key performance ratios and indicators, especially bottom line profit;
	Properly calculate key performance ratios, especially to account for the impact of distributions and withdrawals on critical profitability measures; and
	Identify the differences in the form of owner composition, in owner income tax obligations for company profit, and in owner liability for company debt obligations across the range of business organizations.