Topic: Financial Statement Analysis

Detailed Question: I want to calulate finicial ratio and analysis for two companies using excel sheet. And then you need to do 18 power point slide for this calculation.And then you need to write - Financial Analysis

- Financial planning
- Investment appraisal
- Cost control of a company or project
- The use of Performance Indicators

Learning Outcomes to be Assessed:

1. Describe and appraise the relationships between planning, budgets and actual financial accounts.

2. Compare and contrast different costing techniques within an organisation.

3. Evaluate the role of standard financial and management accounting practices in different types of organisation.

4. Assess long-term decision analysis alternatives in the context of an investment appraisal.

Part 1: Assessment by 10 minute presentation.

You are asked to investigate two actual companies (private sector) or organisations (public sector) within the same chosen sector of business (which may be one in which you have been employed or have a particular interest). The choice of companies must be agreed with your tutors and recorded on a master list by week 5.

Your presentation will be based on information research e.g. using the FAME electronic database available in the library (free to BCU students) tofocus on a comparison of the relative performance of the two organisations, in particular:

Current position (drawn from the latest published accounts), sales, assets and profitability, key performance ratios, and growthin sales and profits over the last three years. You should then summarise your findings based on your interpretations of the data and indicate your view of future prospects for the two companies / organisations.Marks will be awarded for content (50%) Oral and visual presentation skills (25%) and defence (25%)

Part 2: Constructing and use of a Financial Model for an Enterprise.

a) You are asked to construct a dynamic financial model to represent a new venture, to build a new plant to manufacture and sell a globally marketable computer printer. The figures shown are for a first shot ‘Base Case' plan produced manually by the CEO of the parent company, Headline Products.Using the CEO's first attempt on paper, set up a spread sheet for the base case. This must be dynamic i.e. if the key variables are changed, the whole plan changes accordingly.You must provide a printed copy of the base casefrom the spread sheet you have constructed, after ensuring that it calculates results that match those worked out by the CEO and that correct results are also computed if any of the key variables are changed.

b) The six ‘variables'which have been highlighted by the CEOin italicsare elements of data which may vary in practice, either by corporate decision (e.g. product price) or by external circumstances (e.g. cost, tax rate etc.) The CEO wants to examine the effects of a variety of combinations of those. Each student is given a specific combination of the variable values (see attached table below)and is required to evaluate the venture by testing the effects of that particular set of data elements on the projected plan. You are required to show the resultsof the given ‘scenario' in term of the six performance indicators(shown on base case underlined) as below:

1. Sales in year 62. Pre-tax profit in year 63. Return on Assets in year 6
4. Annual growth in sales from year 3 to year 6 (not per annum, the total % increase),
5. Net Present Value (NPV) at an 8% discount ratefor the whole venture based on the cash flow line.
6. Internal Rate of Return (IRR %) for the whole venture based on the cash flow line.

c) Write a summary (approx.1,200 words) of conclusions from your findings, in three sections, under the headings c1, c2 and c3.
1) The usefulness of this modelling method of assessing financial risks, and how it might be extended in practice, for this venture.
2) Conclusions which can be drawn for your special case, and how it compares with the base case, and recommendations for trying other cases.
3) In relation to this venture, identify at least four risk factors (financial or otherwise), assess them for impact and probability and suggest measures to mitigate each of the risk areas.(30%)

d) Construct two graphs / charts which you think best illustrates the progress of the venture as depicted by the base case and / or your case (for example a graphs which compares the two projections on some meaningful basis.

Attachment:- Assignment.rar