Part 1 – Financial Statement Analysis and Presentation For Part 1 you will be calculating and evaluating the financial management of a company. 1.Select a publicly-trading company. Download its most recent annual report(s), including financial statements for the past 2 years. You may select your own company or employer. Include the financial statements in the appendix of your business report. 2.Conduct a financial analysis by calculating a variety of profitability, liquidity, efficiency, and solvency ratios. Ratios should be calculated for a minimum of the past 2 ye

LEVEL 7 ASSESSMENT SPECIFICATION

Student name:

     

Student ID number:

 

Programme:

Wales-Ducere MBA

Module:

Finance for Business Managers

Module code:

BMMB7005D

Contribution to Overall Module Assessment (%):

100%

Lecturer:

Dr. Posi Olatubosun

Internal Verifier:

Richard Dunston

Assignment Title:

Greenfingers plc

Word count (or equivalent):

5,000

Submission deadline:

23:59 UKTIME, Sunday 18th April 2021

Return date of provisional marks & written feedback:

16:00 UK TIME, Monday 18th May 2021

Submission method:

All written assessments, where practical and possible, must be submitted via Turnitin unless otherwise instructed by the Lecturer. (Please DO NOT put this assessment specification into Turnitin or it will match many similarities with other students’ submissions.)

Alternative submission method (if applicable):

Late submission of the assessment will result in a late penalty mark.  Penalties for late submission: Up to one week late, maximum mark of 50%.  Over one week late, 0%.  Only the Extenuating Circumstances Panel may approve a change to submission dates.

Academic honesty / referencing:

Academic honesty is required. In the main body of your submission you must give credit to authors on whose research and ideas your work is based. Append to your submission a reference list that indicates the books, articles, etc. that you have used, cited or quoted in order to complete this assessment.  

Module Learning Outcomes

(from module syllabus)

 

1. Research, apply and evaluate a variety of financial assessment techniques for application to a case study.

 

2. Research, evaluate and critically discuss various issues and theoretical frameworks used in the management and control of financial resources.

 

3. Analyse, interpret and critically assess the financial position of a business, incorporating conclusions/recommendations and advice to managers/directors.

 

4. Use a variety of techniques in the provision of managerial and financial information. Evaluate, assess and advise on issues highlighted from the information generated. Critically evaluate relevant aspects of techniques applied.

 

 

 

 

 


TASK DESCRIPTION

 

For this assignment, you will be conducting a variety of financial analysis and preparing two (2) business reports, outlining your analysis and recommendations and one presentation. The breakdown of the assignment is as follows:

 

Part Description

Report Length

Weight

Financial Statement Analysis and Presentation

2,000 words

40%

Financial Statement Presentation

Presentation 10 min.

10%

Greenfingers, Plc. Investment Programme

2,000 words

50%

 

 

Part 1 – Financial Statement Analysis and Presentation

For Part 1 you will be calculating and evaluating the financial management of a company.

1. Select a publicly-trading company. Download its most recent annual report(s), including financial statements for the past 2 years. You may select your own company or employer. Include the financial statements in the appendix of your business report.

2. Conduct a financial analysis by calculating a variety of profitability, liquidity, efficiency, and solvency ratios. Ratios should be calculated for a minimum of the past 2 years. Include the selected ratio calculations in the appendix of your business report.

 

 

Profitability Ratios

 

Liquidity Ratios

 

Efficiency Ratios

 

Solvency Ratios

1.

Gross Profit Margin Ratio

1.

Current Ratio

1.

Accounts Receivable

1.

Debt Ratio

2.

Operating Profit Margin

2.

Quick Ratio

 

Turnover

2.

Equity Ratio

 

Ratio

3.

Cash Ratio

2.

Accounts Payable

3.

Debt to Equity Ratio

3.

Net Profit Margin Ratio

 

 

 

Turnover

4.

Interest Coverage Ratio

4.

Return on Assets (ROA)

 

 

3.

Asset Turnover Ratio

 

 

5.

Return on Capital

 

 

4.

Capital Turnover Ratio

 

 

 

Employed (ROCE)

 

 

5.

Inventory Turnover Ratio

 

 

6.

Return on Equity (ROE)

 

 

6.

Working Capital Turnover

 

 

 

 

 

 

 

Ratio

 

 

 

3. Critically evaluate the calculated ratios and prepare a business report discussing your analysis. You should explain possible reasons for changes in ratios over the time period your selected. In addition, you should discuss the limitations of your ratio analysis.

4. Make several recommendations on how to improve the financial management of your selected company based on your ratio analysis.

 

Financial Statement Presentation

1. Create a presentation (audio or video) summarising the contents of your report. The maximum length should be 10 minutes.

 

 

 

 

 

 

 

 

 

 

 

Part 2 – Greenfingers, Plc. Investment Programme

 

For Part 2, you will evaluate three investment options and propose how an investment programme might be financed for Greenfingers, Plc.

 

Write a business report for Greenfingers’ Directors explaining whether the company should undertake the project or look for other opportunities. The business report should incorporate the following information:

 

1. An evaluation of the three investment options using the net present value (NPV) technique, assuming the cost of capital to be 6%. (You are required to show all of your calculations.). Identify which option you would recommend and provide a detailed explanation supporting your recommendation.

 

2. Based on your recommendation, calculate the approximate internal rate of return (IRR). (You are required to show all calculations).

 

3. Interpret your results including:

 

a. Include theoretical arguments for the choice of net present values and the best method for investment appraisal.

 

b. Explain the continued popularity among decision-makers of non-discounting methods of investment appraisal.

 

c. Identify what other factors should be considered before an investment decision is made.

 

4. If funds are limited to £2,500,000 and the projects are divisible, (i.e., it is possible to undertake a fraction of a total project), calculate the optimal investment policy and the resulting total NPV from your investment policy.

 

5. Provide your recommendations to the Greenfingers, Plc Directors how the proposed investment programme might be financed by identifying the main sources of available financing. Additionally, include the main advantages and disadvantages of each finance source.

 

Greenfingers, Plc. Scenario

 

Greenfingers Plc., who produce a variety of high-quality outdoor rattan furniture and associated items, is considering whether or not to invest to expand the business. The directors have identified three main options for a four-year plan:

 

A. Expand its flourishing retail outlet to include all products.

 

B. Launch an eCommerce site to generate internet sales.

C. Produce greenhouses and conservatories

 

These three options would require an initial expenditure of (A) £650,000, (B) £1,100,000, or (C) £1,800,000.

 

The most recent estimates on year-end cash flows is as follows:

 

 

Year 1

Year 2

Year 3

Year 4

 

£’000

£’000

£’000

£’000

(A)

300

400

450

500

(B)

500

550

700

950

(C)

500

800

1050

1200

 

Assume corporation tax is 25% and capital allowances are 25% on a straight-line basis. All of these cashflows occur in the year that they arise.

 

 

 

 

 

 

GUIDANCE FOR Students IN THE COMPLETION OF TASKS

 

NOTE: The guidance offered below is linked to the five generic assessment criteria overleaf.

 

1. Engagement with Literature Skills

Your work must be informed and supported by scholarly material that is relevant to and focused on the task(s) set; you should make use of scholarly reviews and primary sources, as appropriate (for example, refereed research articles and/or original materials appropriate to the discipline).    You should provide evidence that you have accessed a wide range of sources, which may be academic, governmental and industrial; these sources may include academic journal articles, textbooks, current news articles, organisational documents, and websites.  You should consider the credibility of your sources; academic journals are normally highly credible sources while websites require careful consideration/selection and should be used sparingly.   Any sources you use should be current and up-to-date, mostly published within the last five years or so, though seminal/important works in the field may be older.  You must provide evidence of your research/own reading throughout your work, using correctly a suitable referencing system, including in-text citations in the main body of your work and a reference list at the end of your work.

 

Guidance specific to this assessment: Application and critical discussion of the various techniques and methods used to assess the performance of a business and capital appraisal models and the sources of finance available. As a guide a minimum of 25 credible sources should be provided.

 

2. Knowledge and Understanding Skills

At level 7, you should be able to demonstrate a systematic understanding of knowledge, and a critical awareness of current problems and/or new insights, much of which is at, or informed by, the forefront of your academic discipline, field of study or area of professional practice, with a comprehensive understanding of techniques applicable to your own research or advanced scholarship. Your work must demonstrate your growing mastery of these concepts, principles, current challenges, innovation and insights associated with the subject area.  Knowledge relates to the facts, information and skills you have acquired through your learning.  You demonstrate your understanding by interpreting the meaning of the facts and information (knowledge). This means that you need to select and include in your work the contemporary concepts, techniques, models, theories, etc. appropriate to the task(s) set.  You should be able to explain the theories, concepts, etc. meaningfully to show your understanding.  Your mark/grade will also depend upon the extent to which you demonstrate your knowledge and understanding; ideally each should be complete and detailed, with comprehensive coverage. 

 

Guidance specific to this assessment: Research the various techniques and methods used to assess the performance of a business and capital appraisal models and the sources of finance available.

 

3. Cognitive and Intellectual Skills

You should be able to: evaluate critically current research and advanced scholarship in the discipline; evaluate methodologies and develop critiques of them and, where appropriate, to propose new hypotheses; deal with complex issues both systematically and creatively to make sound judgements in the absence of complete data. Your work must contain evidence of logical, analytical thinking, evaluation and synthesis. For example, to examine and break information down into parts, make inferences, compile, compare and contrast information.  This means not just describing what! But also justifying: Why? How? When? Who? Where? At what cost? At all times, you must provide justification for your arguments and judgements.  Evidence that you have reflected upon the ideas of experts within the subject area is crucial to you providing a reasoned and informed debate within your work.  Your choice of methodologies to gather data and information must be rigorously defended. Furthermore, you should provide evidence that you are able to make sound judgements and convincing arguments using data and concepts.  Sound, valid, persuasive conclusions are necessary and must be derived from the content of your work.   Where relevant, alternative solutions and recommendations may be proposed.

 

Guidance specific to this assessment: Provision of coherent, structured analysis and conclusions based upon the content provided. Following on from the analysis and conclusions a set of recommendations which address the issues/problems raised in the report covering financial performance and capital project decision(s).

 

4. Practical Skills

At level 7, you should be able to demonstrate originality in the application of knowledge, together with a practical understanding of how established techniques of research and enquiry are used to create and interpret knowledge in the discipline. This includes acting autonomously in planning and implementing tasks at a professional or equivalent level, originality in tackling and solving problems, and decision-making in complex and unpredictable contexts or situations.

 

You should be able to demonstrate mastery of the leading edge subject-related concepts and ideas as they relate to real world situations and/or particular contexts.  How do they work in practice?  You will deploy models, methods, techniques, and/or theories, in those contexts or circumstances, to assess current situations, perhaps to formulate plans or plausible, justifiable recommendations to solve problems, or to propose new models, or to create artefacts, which may be innovative and creative, thereby demonstrating your understanding of how the boundaries of knowledge are advanced through research and/or application.  This is likely to involve, for instance, the use of real world artefacts, examples and cases, the application of a model within an organisation and/or benchmarking one theory or organisation against others.  

 

Guidance specific to this assessment: Use of the range of ratios and their trends to provide comprehensive comment and analysis of the financial performance, covering the following five areas of Profitability; Liquidity: Efficiency: Investment and Gearing. The results of the above ratios should be linked in order to provide a comprehensive review of financial performance. Research and apply appropriate capital appraisal techniques, and sources of finance available.

 

5. Transferable Skills for Life and Professional Practice

Your work must provide evidence of the qualities and transferable skills necessary for postgraduate-level employment in circumstances requiring sound judgement, personal responsibility and initiative in complex and unpredictable professional environments.  This includes demonstrating: the independent learning ability for continuing professional development to advance existing skills and acquire new competences of a professional nature that will enable you to assume significant responsibility within organisations; that you can initiate and complete tasks, projects and procedures, whether individually and/or collaboratively, to a professional level; that you can use appropriate media to effectively communicate information, arguments and analysis in a variety of forms for a variety of audiences; fluency of expression; clarity and effectiveness in presentation and organisation. Work should be coherent and well-structured in presentation and organisation.

 

 

Guidance specific to this assessment: Structure and presentation of a professional report (follows conventions in terms of layout and appropriate sections including correct spelling, grammar, punctuation, flow of narrative/fluency, coherence.

 

 

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