MAN7040: Managing Financial Performance - Business Report - Financial Accounting Assignment Help

Assignment Task:

Question 1:

Requirements:

Prepare a business report, 6 pages long (+/- 10%), to the board of directors of Sainsburys Plc with tables and graphs that analyze the performance and financial position over at least 5 financial years and recommend actions that the board should take. 

Utilize search data about the subject company and its competitor(s) from university databases (FAME, MINTEL) examined during seminars as well as the company financial reports and a range of other sources that you are to find for yourself. 

Organize the ratios into the 4 categories (Profitability, Liquidity, Efficiency, and Gearing) and calculate horizontal and vertical analysis. 

Apart from the graphs, put all the ratios, tables, and analyses in appendices.

Your 6-page business report must include an in-depth critical discussion with appropriate academic references and graphs.
Question 2:

You work as a management consultant and have been approached by a client who is concerned about the future of their engineering business. The board of directors are considering halting the production of 2 of their products that appear to be making no profit. 

As you can see from the table below the directors are considering closing products Y and Z in an effort to improve overall profitability.

You establish that management accounting would show the results differently and may affect the directors’ decision.

Requirements for Question 2 part (a)

1. Calculate the contribution of each product?

2. Use your findings from part (a) and appropriate academic references to explain whether the company should stop making product Y.

3. Use your findings from part (a) and appropriate academic references to explain whether the company should stop making product Z.

4. Discuss how and why marginal costing calculates contribution to pay overheads and why this is useful in evaluating product value to a firm?

5. Do you agree that profitability will improve by ceasing to make Products Y and Z? What do you suggest the company does to increase profitability?

Question 2 part a (continued)

The company board have approached you to get your professional advice opinion on their expansion plan, which entails opening another firm. Below are the figures for the first one that is planned for in the north of Birmingham location next year.

Company policy dictates that any decision should be based on the results of calculating Net Present Value (NPV) of 3 years cash flows using a cost of capital of 12%, Payback Period (PBP) must be less than 3 years, and the Internal Rate of Return (IRR) of the project should provide a 5% cushion in case of increases in inflation or interest rates. 

The investment consists of £5,000 for the land, building costs of £9,480, and £2,196 for fittings and equipment. 

The cash flows in year 1 are expected to be: total sales revenue £34,320; the cost of X products sold £8,004; Y stock sold £5,660; staff costs £1,416; light & heat £2,011; other overheads £7,708. The cash flows for the following years are the same but are expected to increase by 2% inflation each year.

Requirements for Question 2 part (b)

Using the information above and in accord with the above-stated company policy you are required to calculate:

1. Net Present Value (NPV) 

2. Payback period (PBP) and Discounted Payback Period (DPBP)

3. Internal Rate of Return 

4. Based on your calculations do you recommend the investment is made and the opening of the new manufacturing unit? 

5. Critically discuss the limitations of the above project appraisal techniques used and any other recommendations to the board.

Question 3 – Essay question:

Over the last two decades, companies across the world have been found to be increasingly engaging in corporate social responsibility (CSR) activities as well as the sustainability of the environment. Companies are now increasingly publishing substantial amounts of CSR and environmental information within annual reports.

Required:

Write an essay covering a critical discussion of the drivers and motivations of companies to disclose this type of financial and non-financial information about their interactions with wider society and the environment and evaluate the usefulness of doing so.

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