Using a company’s financial statements, you are required to calculate the company’s financial ratios, for each of the four areas of Liquidity, Leverage or Gearing, Profitability and Activity or Efficiency.

Assessment: Finance Insights and Business Intelligence

Indicative Assessment Tasks

Assignment 1 (Report) (35%) (circa 1,000 words)

FINANCIAL RATIOS

Using the annual report(s) of a company of your choice, address the tasks detailed below.

You may choose to access and analyse your own organisation, or alternatively you may choose a well-known company in the UK or in other countries such as, for example, Next Plc. or Marks and Spencer Plc. from the Internet.

Required tasks:
1) Using a company’s financial statements, you are required to calculate the company’s financial ratios, for each of the four areas of Liquidity, Leverage or Gearing, Profitability and Activity or Efficiency. You should calculate ratios over a two-year period (where possible). (50%)

2) Using your results to the ratio calculations above, analyse and critically discuss the performance of the company over the period, from the perspectives of two of the stakeholders - the investors and the employees. You may draw upon additional information at this juncture, such as press releases or other information contained in the company’s annual reports. (35%)

3) Critically discuss the advantages and the limitations of financial ratios as a tool of financial analysis. (15%)

(Total 100%)

Note:

• You are not required to perform numerical calculation on Task 2 and 3

Assessment: Finance Insights and Business Intelligence

Indicative Assessment Tasks

Assignment 1 (Report) (35%) (circa 1,000 words)

FINANCIAL RATIOS

Using the annual report(s) of a company of your choice, address the tasks detailed below.

You may choose to access and analyse your own organisation, or alternatively you may choose a well-known company in the UK or in other countries such as, for example, Next Plc. or Marks and Spencer Plc. from the Internet.

Required tasks:
1) Using a company’s financial statements, you are required to calculate the company’s financial ratios, for each of the four areas of Liquidity, Leverage or Gearing, Profitability and Activity or Efficiency. You should calculate ratios over a two-year period (where possible). (50%)

2) Using your results to the ratio calculations above, analyse and critically discuss the performance of the company over the period, from the perspectives of two of the stakeholders - the investors and the employees. You may draw upon additional information at this juncture, such as press releases or other information contained in the company’s annual reports. (35%)

3) Critically discuss the advantages and the limitations of financial ratios as a tool of financial analysis. (15%)

(Total 100%)

Note:

• You are not required to perform numerical calculation on Task 2 and 3