The Corporate Finance Institute Investment Banking Manual
Investment Banking Manual
corporatefinanceinstitute.com 1
, About Corporate Finance Institute®
CFI is a world-leading provider of online financial analyst training programs. CFI‟s courses, programs,
and certifications have been delivered to tens of thousands of individuals around the world to help
them become world-class financial analysts.
The analyst certification program begins where business school ends to teach you job-based skills for
corporate finance, investment banking, corporate development, treasury, financial planning and analysis
(FP&A), and accounting.
CFI courses have been designed to make the complex simple by distilling large amounts of information
into an easy to follow format. Our training will give you the practical skills, templates, and tools
necessary to advance your career and stand out from the competition.
Our financial analyst training program is suitable for students of various professional backgrounds and
is designed to teach you everything from the bottom up. By moving through the three levels of mastery,
you can expect to be performing industry-leading corporate finance analysis upon successful
completion of the courses.
About CFI’s Investment Banking Manual
The following eBook‟s purpose is to outline all the necessary technical skills needed to succeed in a
career in investment banking. The three-part guide will walk you through fundamental accounting
analysis, valuation techniques, and Excel modeling skills. Produced after hours of research and planning
by current and former professionals in the investment banking industry, you will become familiar with
applicable knowledge that will allow you to thrive in all your future analyst positions.
2
, Table of contents
7 Accounting
8 Introduction
12 Accounting and analysis fundamentals
12 Accounting framework
23 Balance sheet issues
75 Income statement issues
84 Cash flow statements
88 Accounting and analysis for mergers and acquisitions
88 Introduction
93 Acquisition accounting
124 Accounting for associates and joint ventures
131 Considerations for investment banking
132 Comprehensive examples
133 New M&A accounting rules
143 Valuation
144 Discounted cash flow techniques
144 Discounting fundamentals
148 Estimating free cash flow for valuation purposes
153 The key value drivers of cash flow
156 Calculating the terminal value
166 Putting it all together – DCF with terminal value calculation
3
, 175 Cost of capital
175 An introduction to risk
179 Capital asset pricing model (CAPM)
201 The cost of debt and WACC
4
Investment Banking Manual
corporatefinanceinstitute.com 1
, About Corporate Finance Institute®
CFI is a world-leading provider of online financial analyst training programs. CFI‟s courses, programs,
and certifications have been delivered to tens of thousands of individuals around the world to help
them become world-class financial analysts.
The analyst certification program begins where business school ends to teach you job-based skills for
corporate finance, investment banking, corporate development, treasury, financial planning and analysis
(FP&A), and accounting.
CFI courses have been designed to make the complex simple by distilling large amounts of information
into an easy to follow format. Our training will give you the practical skills, templates, and tools
necessary to advance your career and stand out from the competition.
Our financial analyst training program is suitable for students of various professional backgrounds and
is designed to teach you everything from the bottom up. By moving through the three levels of mastery,
you can expect to be performing industry-leading corporate finance analysis upon successful
completion of the courses.
About CFI’s Investment Banking Manual
The following eBook‟s purpose is to outline all the necessary technical skills needed to succeed in a
career in investment banking. The three-part guide will walk you through fundamental accounting
analysis, valuation techniques, and Excel modeling skills. Produced after hours of research and planning
by current and former professionals in the investment banking industry, you will become familiar with
applicable knowledge that will allow you to thrive in all your future analyst positions.
2
, Table of contents
7 Accounting
8 Introduction
12 Accounting and analysis fundamentals
12 Accounting framework
23 Balance sheet issues
75 Income statement issues
84 Cash flow statements
88 Accounting and analysis for mergers and acquisitions
88 Introduction
93 Acquisition accounting
124 Accounting for associates and joint ventures
131 Considerations for investment banking
132 Comprehensive examples
133 New M&A accounting rules
143 Valuation
144 Discounted cash flow techniques
144 Discounting fundamentals
148 Estimating free cash flow for valuation purposes
153 The key value drivers of cash flow
156 Calculating the terminal value
166 Putting it all together – DCF with terminal value calculation
3
, 175 Cost of capital
175 An introduction to risk
179 Capital asset pricing model (CAPM)
201 The cost of debt and WACC
4
