Foundation of Directorship Program Establishing solid foundations

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1 The Foundations of Directorship Program consists of six sessions delivered across three courses Governance for Directors, Finance for Directors, and Strategy and Risk for Directors. Governance for Directors provides participants with an introduction to the functions of the board, the wide range of directors duties and responsibilities, the internal and external relationships of the board, and best practice for conducting effective board meetings. Participants develop a deeper understanding of director performance best practice as well as compliance requirements. Finance for Directors provides a straightforward introduction to financial statements from the director s perspective. Participants will explore the three key financial statements: the balance sheet, the income (profit and loss) statement and the cash flow statement; and discover how directors use these statements to monitor financial performance and to assess overall company performance at board level. The course also examines the financial aspects of directors statutory duties and non-financial indicators of company performance. Strategy and Risk for Directors provides participants with an understanding of how to focus on the long-term direction of their organisation, ie. how to contribute to discussions about what the organisation is going to do and how it is going to achieve it. The course also discusses director knowledge of risk, with the aim of improving participants understanding of what risk is and of how risks faced by organisations are identified and measured. Participants will also investigate ongoing assessment and treatment of risk. Each course may be undertaken in conjunction with other courses in the Foundations of Directorship Program or as a stand-alone education offering. Value proposition Through a comprehensive overview of the main components of directorship governance, strategy, risk and finance you will begin to establish a new director-oriented outlook that will prepare you for a successful director career. Suitable for Executives accepting their first directorship; Those who are considering accepting a directorship; Executives who report directly to a board; and Austra lia n Inst itut e of Compa ny Dir ector s 201 6/17 V1 Page 1 of 9

2 Directors of smaller companies, especially private and not-for-profit companies and community organisations. Learning objectives Governance for Directors Upon completion of this course, participants should be able to: Explain the role and key functions of the board and its directors. Explain the purpose and essential features of corporate governance. Discuss the key duties, responsibilities and rights of directors. Illustrate the consequences of breaching directors duties and responsibilities. Consider the relevant regulatory frameworks applicable to boards and directors. Consider a board s composition, structure and performance. Identify relevant board meeting protocols and procedures (including the use of committees). Outline the use of KPIs in monitoring board performance. Explain how to make an informed decision when considering joining a board. Finance for Directors Upon completion of this course, participants should be able to: Interpret the financial statements of an organisation. Illustrate how an organisation is meeting its statutory obligations in relation to reporting its financial performance. Demonstrate the importance of good cash management. Outline directors duties with regard to financial statements and systems. Interpret financial performance using trends and ratios. Demonstrate when an organisation is facing solvency issues. Outline the board s role in setting budgets and monitoring performance against them. Outline the use of KPIs in monitoring business performance. Austra lia n Inst itut e of Compa ny Dir ector s 201 6/17 V1 Page 2 of 9

3 Strategy and Risk for Directors Upon completion of this course, participants should be able to: Describe the key stages within the strategic planning process. Consider the board s and individual director s roles within each stage of the strategic planning process. Apply commonly used strategic planning and monitoring tools and frameworks. Identify key causes of strategic risk and how those risks can best be treated. Link strategy to financial health and value creation. Consider the importance of an organisation developing and implementing robust risk management practices. Describe the risk appetite of an organisation. Illustrate the link between risk management, risk culture and effective leadership. Describe the director s role in assessment, monitoring and treatment of risk within an organisation. How is this course delivered? The Foundations of Directorship Program comprises three one day courses. Layout is generally cabaret, to enable small group work and table discussion. Input is provided by a facilitator and PowerPoint slides, with short activities and case studies included to guide discussion. Group size is customarily limited to a maximum of 25 people. Our facilitators are experienced company directors. They are selected based on their knowledge of the board environment as well as their ability to engage and connect with participants. Austra lia n Inst itut e of Compa ny Dir ector s 201 6/17 V1 Page 3 of 9

4 Content outline Governance for Directors This course consists of two sessions The Role of the Director and the Board and Introduction to Board Meetings and Governance. The Role of the Director and the Board provides participants with an introduction to the functions of the board and the wide range of directors duties and responsibilities. It outlines the key functions of a board, the role of a director, and the internal and external relationships of the board. Participants develop a deeper understanding of director performance best practice as well as compliance requirements. Introduction to Board Meetings and Governance provides an overview of how boards and directors undertake their roles. Participants will explore sound governance processes and practices, learn more about the composition and structure of the board, and develop reputable practices for conducting effective board meetings. The Role of the Director and the Board covers: The role and relationships of the board. Who is a director. How boards do their job corporate governance. Directors duties and responsibilities. Introduction to Board Meetings and Governance covers: The role and composition of the board. Boards in action. Evaluating and improving board performance. Making an informed decision in joining a board. Appointment, conduct and removal of directors. Rights of directors. Austra lia n Inst itut e of Compa ny Dir ector s 201 6/17 V1 Page 4 of 9

5 Finance for Directors This course consists of two sessions Introduction to Financial Statements for Directors and Assessing Financial Performance for Directors. Introduction to Financial Statements for Directors provides a straightforward introduction to financial statements from the director s perspective. Participants will explore the three key financial statements: the balance sheet, income (profit and loss) statement and the cash flow statement; and discover how directors use these to monitor financial performance. The session also examines the financial aspects of directors statutory duties. Assessing Financial Performance for Directors helps participants to assess company performance at the board level. It introduces key financial data and demonstrates how directors can use it. The session also covers nonfinancial indicators of company performance. Introduction to Financial Statements for Directors covers: Introduction to the financial statements. The structure of financial statements. Income statement, Balance sheet & Cash flow statement. Statement of changes in equity. Assessing Financial Performance for Directors covers: Why should you analyse company performance? Ratios and analysis. Insolvency prediction. Non-financial performance indicators. Some issues in financial statements. Statutory duties: financial statements and reports. Austra lia n Inst itut e of Compa ny Dir ector s 201 6/17 V1 Page 5 of 9

6 Strategy and Risk for Directors This course consists of two sessions Introduction to the Strategic Role of the Director and Risk: Issues for Directors. Through Introduction to the Strategic Role of the Director, participants will develop the skills required to discuss and evaluate the formulation and monitoring of organisational strategy. Participants will also gain an understanding of the role strategic planning plays in the long-term financial health and wealth creation of their organisation. Risk: Issues for Directors focuses on the director s knowledge of risk. It aims to improve participants understanding of risk and how risks faced by organisations are identified and measured. Participants will also learn about the ongoing assessment and treatment of risk. Introduction to the Strategic Role of the Director covers: Organisations and strategy. The role of the board in setting strategy. Formulating a strategic plan. Approving plans and implementation. Strategic risk. Strategic review. Risk: Issues for Directors covers: Risk appetite and risk culture. Personal risks for directors Business and organisational risks and risk cycles. Assessing and treating risks. Dysfunctionality. Data collection, metrics, reports, early warning and key response triggers. Business continuity planning. Formats The Foundations of Directorship Program is available via the following formats: Face-to-face learning In-House. Austra lia n Inst itut e of Compa ny Dir ector s 201 6/17 V1 Page 6 of 9

7 Assessment process At the Australian Institute of Company Directors (AICD) assessment is an opportunity for participants to consolidate their course learning and to benchmark their understanding against the standard set by AICD. On completion of each of the three courses in the Foundations of Directorship Program participants will be provided with an opportunity to complete a 40 minute open book, multiple choice quiz comprising 9 questions. The quizzes will be available online and will assist participants in embedding the learning from the course. Participants wishing to complete the assessment will have 3 months from the start date of the course to complete each quiz. To successfully complete each quiz participants need to attain a mark of 65% or higher. There is one opportunity to resit if they are unsuccessful on their first attempt. Foundations of Directorship Certificate To attain the Foundations of Directorship Certificate participants need to successfully complete all three quizzes from all three courses of the Foundations of Directorship Program. Features and benefits Feature Provides a director-oriented view of governance Clarifies the links between stakeholders (including shareholders), directors and managers Discusses the mechanics and processes to facilitate effective functioning of the board Benefit Participants develop the ability to consider issues from a director s perspective, as they apply to various organisational structures Participants can improve how they identify and manage internal and external stakeholder interests Participants gain insight into how board meetings should function and how they can best contribute to proceedings Austra lia n Inst itut e of Compa ny Dir ector s 201 6/17 V1 Page 7 of 9

8 Examines board and individual director performances through key performance indicators Analyses the three key financial statements Discusses directors responsibilities Shows directors how to calculate key ratios Provides an overview of insolvency Outlines a comprehensive process on how to formulate a strategic plan Discusses strategic measures and clarifies the organisation s, board s and directors roles Considers how to determine the acceptability of risk avoidance, reduction and transfer Compares a director s risk appetite with that of the board and the organisation Applies key concepts to case studies Participants develop skills to evaluate the effectiveness of their performance through a clear and transparent review process Participants learn a financial vocabulary that is in general use across most organisations and gain skills to assess the financial position of a company Participants develop an understanding of legal and other obligations in relation to financial statements and reporting Participants learn what financial aspects they should review to evaluate company performance and develop an understanding of how to measure the productivity and efficiency of their organisation Participants receive coverage of an essential issue of relevance to directors Participants can examine the effectiveness of adopting a structured approach to formulating strategies Participants develop a clearer perspective on their role in monitoring the implementation of strategic plans, and can identify the influence of risk on their organisation Participants gain practical tips to improve their understanding of a director s role in risk management Participants are assisted to recognise their own risk appetite and how this can influence their decision-making as a director Participants can immediately apply their learnings to realworld situations Austra lia n Inst itut e of Compa ny Dir ector s 201 6/17 V1 Page 8 of 9

9 What do participants achieve upon completion? Participants gain 24 DPD units for confirmed attendance at all 3 courses. Statements of Attendance are available upon request from AICD host state offices. In-House participants earn 4 DPD units for each 3.5-hour session attended. Participants must complete all three Foundations of Directorship courses and assessments (online quizzes) to attain the Foundations of Directorship Certificate. Being awarded the Foundations of Directorship Certificate earns participants an additional 5 DPD units. Note that no post-nominals are awarded. Recommended preparation Not applicable. Testimonials It provided good perspective for someone new to the director world. Brought the material to life by incorporating examples from participants into the learnings from the course. An enjoyable and well-paced course. I found it relevant and understandable thank you. It was an excellent professional development, learning and networking experience. May also be interested in Interpreting Financial Statements (elearning) In the Boardroom: Responsibilities and Practice (Face-to-face learning; In-House) Company Directors Course (Face-to-face learning; In-House) Austra lia n Inst itut e of Compa ny Dir ector s 201 6/17 V1 Page 9 of 9