TITLE : FAST FORWARD MBA IN FINANCE, THE.

This book is written for business managers, as well as for bankers, consultants, lawyers, and other business professionals who need a solid and practical understanding of how business makes profit, the cash flow from profit, the capital needed to support profit- making operations, and the cost of capital. Business managers and professionals don't have time to wade through a 600-plus page tome; they need a practical guide that gets to the point directly with clear and convincing examples.

In broad terms, this b6ok explains the tools of the trade for analyzing accounting and financial information. Financial statements are the primary sources of such information. Therefore, finaAcial statements are the best framework to explain and demonstrate how managers analyze accounting and financial information to make decisions and to keep control. Surprisingly, most books of this ilk do not use the financial statements framework. My book offers many advantages in this respect.

This book explains and clearly demonstrates those indispensable analysis techniques that street-smart business managers use to:

* Make profit.

* Control the capital invested in assets needed for

* making profit and to decide on the sources of capital

* for these asset investments.

* Generate cash flow from profit.

The threefold orientation of this book fits hand in glove with the three basic financial statements of every business: the profit report (income statement), the financial condition report (balance sheet), and the cash flow report (cash flow statement). These three "financials" are the center of gravity for all businesses.

This book puts much more emphasis on cash flow than typical books in this basic area of management skills. As a matter of fact, cash flow is put on an equal footing with profit. Business managers never can ignore the cash flow consequences of their decisions. Higher profit may mean lower cash flow; managers must clearly understand why, as well as the cash flow timing of their profit.

The book begins with a four-chapter review of financial statements, which are explained from the manager's point of view, in contrast with the generally accepted accounting principles (GAAP) point of view. GAAP are not wrong of course; externally reported financial statements must be prepared following these accounting standards. GAAP provide the bedrock rules for measuring profit. Business managers obviously need to know how much profit the business is earning.

But, to carry out their decision-making and control functions, managers need more information than is reported in the external financial statements of a business. GAAP are the point ofdeparture for preparing the more informative financial statements and other accounting reports needed by business managers.

The "failing" of GAAP is not that these accounting rules are wrong for measuring profit, nor are they wrong for presenting the financial condition of a business-not at all. It's just that GAAP do not deal with all the types of infbrmation needed by managers. In fact, much of this management information is very confidential and would never be included in an external financial report open to public view.

Let me strongly suggest that you personalize every example in the book. Take the example as your own business; imagine that you are the principal owner or the top-level manager of the business, and that you will the reap the gains of every decision or suffer the consequences, as the case may be.

This book never would have happened without the initial push by John Mahaney, to whom I express my heartfelt appreciation. As usual, the editors at John Wiley were superb. Many thanks to Janet Coleman and all the others at 605 Third Avenue. I would like to mention that John Wiley & Sons has been my publisher for more than 20 years, and I'm very proud of our long relationship.

John A. Tracy Boulder, Colorado February 1996