Drivers of return on invested capital and profitability

Focusing on Australian listed companies and small businesses, the course offers benchmarks and insights into typical profitability levels, key drivers and the challenges of forecasting future earnings. The course demonstrates to learners how to apply ROIC in business advisory reports and performance analysis, supporting informed decisions in auditing, valuation and strategy. Through videos and practical activities, learners will gain essential tools for reliable financial analysis.

Topics include:

• A summary of typical ROIC
• Drivers and determinants of firm profitability
• Typical magnitude of economic determinants of ROIC
• Magnitude of firm drivers of ROIC = Sales * Margins
• Quantifying risk and uncertainty of profitability
• Measurement of ROIC

Learning outcomes:

• Analyse the drivers of profitability and return on invested capital for Australian businesses
• Evaluate risk, variation and uncertainty in forecasting future earnings and profitability
• Apply the return on invested capital metric reliably to prepare business advisory reports

Key benefits:

• Discover the key drivers of profitability and return on invested capital in Australian businesses to deliver sharper insights and strategic advice
• Build confidence in assessing risk and uncertainty when forecasting earnings, to make accurate and informed decisions
• Use return on invested capital metrics effectively in business advisory reports to provide credible, high-value recommendations to your organisation and clients.