Financial Accounting Assignment
PURPOSE - The purpose of this assignment is to provide hands-on experience to Accounting 1/ BACC105 students on financial analysis using real-life data. It gives students the opportunity to demonstrate, through an extended exercise, their ability to apply their accounting knowledge and analytical skills to a real-world setting. It also provides an opportunity to develop students' interpersonal skills in a work environment.
ASSIGNMENT QUESTIONS - Answer both Part A and Part B as outlined below.
Part A - Use the 'ABC Learning' and 'One Tel' documentaries to identify:
- issues that led to the corporations collapse
- financial statement (s) and/or other sources of information that contain any earlier signs of the businesses' failure
- financial ratios that can be used to detect early signs of these issues
Summarise your findings in the table attached, recording the first issues that both companies had in common followed by the issues unique for each company. Use a 'bullet point' format and record one issue per line.
In 3-5 lines, provide your recommendations on how to avoid these bankruptcies.
Part B (Financial Statement Analysis)
Assume that you are a financial adviser and a client has approached you seeking your advice as to whether they should place their money (e.g. $10,000) in to a long-term bank deposit or invest it in one of the selected companies. Discuss potential risks and returns related to the above options using:
1. Relevant data provided by a bank of your choice.
2. The 2016 and 2017 annual reports of two listed companies of your choice. Conduct a financial analysis of both listed companies. You should evaluate these entities' profitability, liquidity, financial stability and attractiveness as an investment. Appropriate ratios (rounded to four decimal places) should be calculated to enable a complete assessment of the companies (use Excel tables!!!). The report should contain a discussion and analysis of the ratios calculated. The workings and calculations for all the ratios must be included in the report and should be presented in an appendix. You may use additional resources for answering this part. These resources must be referenced in your report.
All questions relate to the financial figures of the consolidated entities. Please note, you are neither required to, nor expected to, print out the entire annual reports. These are lengthy documents!
Your report should contain the following sections, in the order given:
1. Assignment cover sheet and Team Contribution Declaration
I. Part A (Analytical Summary of the Corporate Collapse Study)
II. Part B
2. Title page
3. Table of contents
4. Introduction
5. The body:
5.1. financial analysis of the entities' profitability
5.2. financial analysis of the entities' liquidity
5.3. financial analysis of the entities' efficiency and solvency
5.4. financial analysis of the entities' attractiveness as an investment
6. Conclusions
7. Recommendations
8. List of references
9. Appendices
Attachment:- Assignment Files.rar