Paper, Order, or Assignment Requirements

You will be presented with summarised financial statements of two companies. You will have a unique assessment due to its mix of company financial statements.

The first company details

https://docs.investornetwork.com/content/3413/537d9b6c927223c796cac288cced29df.pdf

The second company details

https://docs.investornetwork.com/content/3422/9de6d14fff9806d4bcd1ef555be766cd.pdf

Required:

Answer all parts of this assessment. Assuming you are employed as an accountant for a company, you are to provide advice to your Board of Directors.

You are to prepare a report to analyse the results of the companies that you have been given, calculating as many ratios as you consider appropriate.

This report should look at all aspects of the companies, including:

 

Part A (40 marks)

Should your company accept each of these companies as your customer? If so, discuss any sales policies that must be introduced.

 

Part B (40 marks)

Calculate and provide advice on the following:

1) What value would you give to a 10% shareholding in these companies? Should your company buy shares in these companies?

2) Prepare the 2015 Cash Flow Statement for each company.

3) Calculate the Z score of each company based on the most recent financial results.

 

Part C (10 marks)

If your company were to acquire one or more of the companies, recommend areas of each business that can be improved using budgets.

 

The remaining 10 marks will be awarded for the presentation and layout of your report.

You are permitted to use any resources that you deem appropriate   much as a professional accountant or financial advisor would do. Therefore, you can use materials that you have prepared before 4th December such as pro-forma spreadsheet to calculate any appropriate ratios or the Cash Flow Statement (for 2015 only; 2014 is not required).

 

There is no specified word limit. The limited time available will constrain the length of the report that you present. Remember that the directors will be seeking financial advice and that your advice should be presented in a report format.

 

Note – for consistency when calculating ratios, please consider net profits and earnings after taxation.