ACRA Investor Report:
Project instructions:
You are required to:
– Choose a reporting entity from LSE AIM Index in the oil and gas sector: either Hurricane Energy, Tower Resources, Andes Energia, Empyrean Energy, Trinity Exploration, Forum Energy
– Analyse the entity?s latest annual reports, by selecting and calculating accounting ratios and by proposing possible explanations of the results, in light of the entities? strategies as indicated in their annual reports.
Aim:
An investor wishes to gain exposure to the oil and gas industry on the AIM, with potential for high upside in the next 12 months. Analyse the company, and provide investment consideration for your client based on the above. You will do this by:
– preparing a report for a client that you are pretending to advise, having clarified the client?s requests
– utilising the entity?s annual reports to demonstrate the limitations of a theoretical model of analysis
Additional Instructions:
– support your arguments with data sourced from the annual reports. If you source your data from anywhere else, you must ensure that your chosen source is reliable and clearly indicated. Any method, model and theory you choose to apply must be duly sourced, i.e. it must absolutely clear what parts of your report present your original ideas and what parts present others? ideas
– use simple systems of ratios, i.e. never make comparisons or comments based on ratios individually taken, but always use them to build a profile of the entities you are analysing. Your choices of ratios must be justified as instrumental to your aims
– present your own conclusions and critical view
– apply your critical evaluation throughout the report.
– take into consideration the operating environment of the entity and make a recommendation based on that as well.