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Plymouth Business School ACF103

REFERRED COURSEWORK

Page 1 of 5

 FACULTY OF BUSINESS

Plymouth Business School

Academic Year 2017/2018

ACF103

Business Accounting

REFERRED COURSEWORK

Instructions to Candidate:

Introduction

This referred coursework represents 100% of the mark for Referred Coursework for ACF103 Business Accounting module. The purpose of the referred coursework is to assess how well you:

 understand the principle underpinning the financial statements,

 understand the basic techniques and have developed skills in the analysis and interpretation of financial information,

 can calculate important ratios for determining the profitability, efficiency and liquidity of a business,

 interpret the significance of the ratios calculated,

 explain the advantages and limitations of the techniques.

Task

Your task is to write a financial review of the Annual Report of a company of your choice. The basis for your choice may be a personal interest, through employment or investment, or out of general interest in a currently famous (or infamous!) individual or organization. If you have difficulty in choosing a suitable company, I shall be happy to select one for you.

Whatever your choice, you will need a copy of the current Annual Report. You may find it easy to obtain a copy from the Financial Times website. Look for the pages Page 2 of 5

about the ‘FT Free Annual Reports Club’. Alternatively, you can contact your chosen company direct or obtain information via their website.

The review should include:

1. The calculation of at least six relevant ratios over two years (current and previous year),

2. Comment about the company’s profitability over the two years,

3. Comment about the company’s liquidity position, exposure to risk and comment about the company’s sustainability (both in terms of the environmental perspective and financial perspective).

There is a fixed word limit of 2,000 words but no preferred style of presentation.

NB:

This is an individual assignment.

Word Limit: 2000

Please note that the deadline for submission of REFERRED COURSEWORK ONLY is by 3pm on Thursday 18th August 2016 to the Faculty Support Office, Level 1, Cookworthy Building. You may submit the work prior to this date. Page 3 of 5

ACF103 Summary of Key Financial Ratios Type and name

Format

Formula

Profitability ratios

Return on ordinary shareholders’ funds (ROSF)

%

100 x reserves + capital share Ordinary any if dividend preference & after tax profit Net

Return on capital employed ROCE

%

Net profit before interest & tax Share capital + reserves + long - term loans x 100

Operating profit margin

%

100 x revenue Sales tax & interest before profit Operating

Gross profit margin

%

100 x revenue Sales profit Gross

Efficiency (activity) ratios

Average inventory turnover period

days

365 x sales of Cost held inventory Average

Average settlement period for receivables

days

365 x sales Credit s receivableTrade

Average settlement period for payables

days

365 x sales of Cost payables Trade

Sales revenue to capital employed

times

s liabilitie current - non reserves capital Share revenue Sales  

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