Photo: Jenny Gignoux, Ghana

Financial Statement Review

Mr. Stuart MackenzieDirector of Financial Reporting

University of British Columbia

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Objectives

• Why financial statements important?

• Review UBC’s statements

• Difference between profit and cash

• Profit and loss key measures

• Importance of budgets

• Balance Sheet key measures

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University of British Columbia

• Established 1908

• 54,000 students over two campuses

• Top 40 in world rankings

• Major research programs ($500 million)

• Faculties – Medicine, Science, Arts, Commerce

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UBC’s financial statements

http://www.finance.ubc.ca/reports

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UBC financialstatements

• Statement of Operations– Revenue sources– Expenses– Surplus before capex

• Statement of Financial Position– Cash (see cash flow)– Investments– Endowments– Deferred contributions

• Statement of Cash Flow• Notes to financial statements

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Cash or profit?

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Profit & Loss Statement

• Revenue– Key business driver– Source of growth– Identify lines of business– Volume/price

• Expenses– Variable (cost of sales, margins)– Fixed (overhead)

• Interest• Taxes

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Budgets

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Balance Sheet

• Cash– Cash flow statement

• Working capital– Short-term liquidity (12 months)

• Other assets and other liabilities– What are they?

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Conclusion

• Cash is king!

• Revenue is business driver

• Cost structure (variable/fixed)

• Budgets (targets improve performance)

• If it doesn’t make sense, ask.

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www.uniterra.ca