Topic: Business Finance assignment

the instructions that should be followed as per Essex requirements:

  • Font type should be Arial and font size should be 12
  • Referencing should be Harvard referencing. In-text citation is essential

The answer should be in the form of a written report of 2,000 words (up to maximum 2200 words. If more marks will be deducted). The word count includes the diagrams, headings and sub-headings, in-text citation but not references.

  • It should include a brief introduction (around 100 words) identifying why Tesco was selected and what the assignment will be talking about/considering
  • It should include a brief conclusion at end of assignment summing up the assignment (also around 100 words)

Select a company of your choice and obtain their latest annual report (this can be one you work for, are familiar with or one you have an interest in). Ensure your chosen company will enable you to meet all of the criteria below.

Using your chosen company, you are required to:

  1. Explain the key sources of finance for your company. For example, what is the mix of share capital and long-term loans, does this company appear to be risky from a gearing point of view? (350-500 words)
  2. Discussing the company’s sources of finance (not just describe them) by how they impact on the gearing of the business based on funding by equity or debt
  • Calculate gearing ratio (formula of total debt/total capital should be used) to make conclusion about how risky the company is. Very important to make comparison with other companies gearing ratio in same industry
  • Is the business primarly funded by debt or equity; is the company using short-term or long-term debt and why; is company primarily using internal sources as retained profits or bringing finance from outside
  1. Identify the key elements of working capital and discuss any particular strengths or weaknesses which you feel the company has in this area. (350-500 words)
  2. More than just looking at level of working capital but look at the individual current assets and liabilities i.e. how is working capital made up
  • Judge company performance in managing working capital: areas of strengths and weaknesses. To do so calculate liquidity ratios as current ratio and acid test ratio to identify if company is meeting financial obligations as well as activity ratios such as length of time for moving company inventory and operating cash cycle to identify how working capital is managed
  • Comparison of ratios with other companies in same industry such as comparing Tesco, Walmart and Sainsbury’s inventory turnover and whether it is changing. Thus, coming to a conclusion to how good is this i.e. it is a strength or weakness for company compared to competitors and taking into account the industry itself.
  1. Discuss the company’s exposure to risks generally and exchange rate risk in particular as a result of their involvement in international markets. How does the company manage these risks, and how successful do you think the company is in this? (400-500 words)
  2. A bit on general risks but focus on international operation risks esp. exchange rate: what are these risks, how it manages them and how successful is the company in their management (the impact of the risk management)
  • Use theory about kind of activities that should be undertaken in order to minimize the impact of these risks and is the company doing what is recommended by theory?
  • Use section about risk and its management in the company’s annual report, but not just identify these risks but discuss if the company is achieving its aims by undertaking these risk management activities and are they doing what you would recommend based on used theories in terms of exchange rate management.
  1. Evaluate the success of corporate restructuring activities undertaken by your chosen company in the last five years or so. For example, has it acquired new subsidiary companies through mergers or takeovers, entered into joint ventures or undertaken divestment, and how successful has this been? (400-500 words)
  2. Why particular restructuring took place over the last 5 years, what was it expected to do and its purpose and did the company achieve these objectives
  • Look at how the profitability has changed over that time to evaluate the success of restructuring done using ratios as profit margins or return on capital employed i.e. identifying restructuring success by looking at the impact on profitability. However, there might be other reasons for restructuring so consider them and whether these objectives were achieved

Type of service-Academic paper writing
Type of assignment-Essay
Subject-Finance
Pages / words-7 / 1925
Number of sources-7
Academic level-Senior (College 4th year)
Paper format-Harvard
Line spacing-Double
Language style-US English

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