Columbia University: Free Cash Flow Analysis Course Syllabus

Overview: This course offers a focused, practical exploration of free cash flow analysis, a cornerstone skill in corporate finance and investment valuation. Designed by Columbia University and hosted on edX, it guides learners through foundational principles to advanced applications using real-world financial data. With a total time commitment of approximately 15–20 hours, the course blends theoretical knowledge with hands-on exercises, case studies, and a capstone project. Ideal for finance professionals and advanced students, it emphasizes industry-standard tools and valuation techniques essential for careers in investment banking, equity research, and corporate finance.

Module 1: Introduction & Foundations

Estimated time: 3 hours

• Introduction to key concepts in free cash flow and financial performance
• Understanding the role of cash flow in valuation and corporate decision-making
• Discussion of best practices and industry standards in financial analysis
• Hands-on exercises applying foundational cash flow concepts
• Interactive lab: Building basic free cash flow models

Module 2: Core Concepts & Theory

Estimated time: 4 hours

• Review of financial statements with emphasis on cash flow statements
• Deriving operating, investing, and financing cash flows
• Calculating free cash flow to firm (FCFF) and free cash flow to equity (FCFE)
• Assessment: Quiz and peer-reviewed assignment on core theory

Module 3: Practical Application & Techniques

Estimated time: 2 hours

• Applying free cash flow techniques to real financial models
• Hands-on exercises in adjusting for non-recurring items and working capital changes
• Interactive lab: Building practical free cash flow projections

Module 4: Advanced Topics & Methods

Estimated time: 3 hours

• Advanced valuation techniques using discounted cash flow (DCF) models
• Handling complex capital structures and tax considerations
• Discussion of best practices in forecasting and sensitivity analysis

Module 5: Case Studies & Real-World Projects

Estimated time: 2 hours

• Case study analysis with real-world corporate examples
• Evaluating financial performance using free cash flow metrics
• Interactive lab: Diagnosing cash flow health of public companies

Module 6: Final Project

Estimated time: 4 hours

• Deliverable 1: Comprehensive DCF valuation model using real company data
• Deliverable 2: Written analysis of cash flow trends and investment recommendations
• Deliverable 3: Peer review and final submission meeting professional standards

Prerequisites

• Basic understanding of financial statements (income statement, balance sheet, cash flow statement)
• Familiarity with fundamental accounting and finance concepts
• Proficiency in Excel or similar spreadsheet tools recommended

What You'll Be Able to Do After

• Evaluate a company’s financial health using free cash flow metrics
• Construct accurate discounted cash flow (DCF) valuation models
• Interpret and adjust financial statements for cash flow analysis
• Apply best practices in forecasting and scenario analysis
• Build a professional portfolio piece using real-world financial data