Finance for Lawyers

Objective
Lawyers play a pivotal role in the financial world, but often know little about finance. The Finance for Lawyers training course aims to fill this knowledge gap by providing people with a legal background with the knowledge to better understand the financial decision-making of their corporate clients, and to communicate more effectively in integrated teams of lawyers, accountants, and (investment) bankers.

Key benefits
By attending this program, you will:

• Understand the key basic concepts in corporate finance and investments
• Be able to ask the right questions to your clients, and to their main financial advisors: accountants and investment bankers
• Improve your understanding of current financial market developments and trends
   

Overview
Both in corporate finance and in investments, lawyers are important.  Corporate restructuring transactions like mergers, takeovers, joint ventures, buy-ins and buy-outs almost never occur without in-depth legal advice and close involvement of lawyers.  In investment, lawyers play a key role in the legal issues of the establishment and structuring of investment vehicles.  Besides this, they often serve as negotiators in investment transactions.

Of these transaction processes, finance, accounting and economics are crucial aspects. In the field of finance, issues like diversification, valuation and the understanding of cash flows and the time value of money should be part of the knowledge of all those involved in the transaction.   Accountancy issues are crucial in the due diligence process of the transaction, and the economic theories of agency and corporate governance are the basis for the structuring of investment vehicles and management compensation.  In all these disciplines lawyers may have a bit of a handicap, since their training usually does not include finance-related issues.  Moreover, in these transaction processes, they usually operate in multidisciplinary teams including client representatives, investment bankers, accountants and the lawyers themselves.  The other players usually have a strong finance or accountancy orientation, which puts the lawyers at an even greater disadvantage, not only in their understanding of the issues involved, but also in the common finance vocabulary.

Besides the theoretical basics, the focus in the Finance for Lawyers program will be on the practical implementation of the analytical tools in a number of smaller cases. Also, a significant part of the available time will be used to illuminate the exact meaning of the relevant professional language and terminology.

Day 1
Financial Calculations and Valuation

• Opportunity cost of capital and time value of money
• Exercises: Discounting and Compounding
• Present value
• Exercises: Present value

Day 2
Basics of Investment

• Returns
• Exercises: Calculating returns
• Risk: Distributions, variance and standard deviation
• Exercises: Calculating standard deviation
• Correlation, covariance and diversification
• Exercises: Calculating correlation and covariance

Day 3
Financial Statement Analysis

• Introduction to financial statement analysis
• Casework: liquidity management and cash flow analysis
• Profitability and Economic Value Added (EVA)

Day 4
The Cost of Capital

• Determining the cost of capital
• Casework: determining the discount rate and its valuation effects

Valuation in Practice

• Valuation in practice: IRR, coping with inflation and long run cash flows
• Valuation cases

Day 5
Corporate Governance

• The importance of corporate governance
• What is the financial-economic background of corporate governance?
• How do we deal with it?
• Exercises
   

Mergers & Acquisitions

• Wealth effects of M&A
• Reasons for mergers
• Understanding M&A terminology 
• M&A case 

Day 6
The Due Diligence Process

• Introduction to the due diligence process
• Casework: why perform due diligence?
• Financial due diligence
• Casework: normalized net working capital

The Finance for Lawyers training course is recommended for legal professionals who are seeking to expand their understanding of (corporate) finance and investments. The program does not assume any prior knowledge regarding finance, mathematics, or statistics.

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>  Foundations of Finance

"I really think that the course provides you with the information you need to understand your clients."
Lawyer / Associate
Tax and Corporate Department
Clifford Chance
The Netherlands

"Perfect quantity and quality of finance for lawyers, especially for those in the finance industry."
Member of the Board of Directors
Croatian Pension Investment Company
Croatia

"The course provides in a short time the “tools” necessary for a lawyer to be able to understand the concepts behind valuation, financial statements, corporate finance, investment risk and due diligence. This knowledge shortens the gap between him/her and “finance people."
Supervision Officer
AFM - The Netherland's Authority for the Financial Markets