Subject Code: HC2091
Internal Code: 1AHGGH
Asset Utilisation - Accounting and Finance Assessment Answer
Task
This assessment task is a written report and analysis of the financial performance of a selected listed company on the ASX in order to provide financial and investment advice to a wealthy investor. This assignment requires your group to undertake a comprehensive examination of a firm’s financial performance based on update financial statements of the chosen companies.
1.Description of the companies
Prepare a brief description of the selected company, outlining the core activities, competitive advantages, and the market in which it operates within and any factors in the company’s history which you consider help present a “picture” of your chosen company.
2.Calculation and analysis of performance ratios
Using financial data obtained from current financial statements of your selected company for the given 2 years to calculate the
following ratios and present them in relevant charts or table. Provide analysis and justify your opinions using the data:
- Short term solvency (Liquidity ratios)
- Long term solvency (Financial Leverage ratios)
- Asset utilization (efficiency or turnover ratios)
- Profitability ratios
- Market value ratios
3.Graphs and comparison of share price movements
Using the information from the ASX to prepare one or more graph displaying movements in the monthly share prices over the last two years for the chosen company that you are investigating.
Providing an analysis to compare the movements in the companies’ share prices to the All Ordinaries Index. For instance, whether your selected company price trend is more or less volatile compared to the index? How closely it is correlated with the All Ordinaries Index, above or below the index?
4. Share valuation
You are also required to calculate the value of selected company’s stock above, using the Constant Dividend Growth Rate model. Assume the company chosen above has a 4% dividend growth rate and the required rate of return is 9%. Compare the stock value you found using the model with the current stock market price. Are there any differences? Explain these differences.
5. Consulting Report
After completion of your analysis, you need to present a well- structured report to your client using appropriate style and language.
Structure of the Report: will include:
1. Title
2. Introduction
3. Table of Content
4. Body (In-text citation: paraphrased or a quotation to support your arguments)
5. Conclusion
6. Recommendation
7. Reference lists (Harvard Style)
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