Posted: February 5th, 2015

Financial Management

Paper, Order, or Assignment Requirements

 

 
Financial management

 

Part A

 

Q1. Explain each of the following terms from the point of view of a listed company:

 

• Types of Investment (200 words)
• Sources of Finance (400 words)
• Distribution decision (200 words)

(When answering the question you should attempt to classify the answer based on theory.)

 

[30 marks: 10 marks each]

 

Q2.What are the consequences of being highly leveraged?                                                                                                                                                          (200 words)

[10 marks]

 

 

Q3. Where can information relating to Q1 (i), (ii), (iii) be found within the Financial Statements and Accounts of a company? You are not required to directly address the company which you have chosen in Part B of the assignment.

(100 words)       

[15 marks: 5 marks each]

 

 

Q4. What are the ratios associated with Q1 (i), (ii), (iii)? Give three examples from each category, clearly stating why they are important, and who they are important to.

(100 words)

[15 marks: 5 marks each]

 

 

 

Part B

 

Q5. Obtain the most recent published accounts of   one of the following companies:

Tesco Plc. (TSCO:L)

BP Plc. (BP:L)

Diageo Plc. (DGE:L)

Rio Tinto (RIO:L)

Tui Travel (TT.:L)

Vodafone Grp. (VOD:L)

 

Using the information contained in the company’s Financial Statements and Accounts explain the key investment, financing and distribution decisions that have been made by the company during the year and comment on the effectiveness of management’s ability to generate shareholder wealth.

(500 words)

[15 marks: 5 marks each]

 

 

In answering this part of the requirement, it may be useful to include consideration of the following issues:

• What investments were made, and why?
• Were there any significant disposals?
• Was finance obtained from internal or external sources (or both)?
• Was finance from short term or long term sources?
• What were the sources of any external finance?
• Was there evidence of any finance being repaid to investors?
• How do this year’s dividends compare to previous years?

 

 

Q6. Using this analysis of the Company situation which you have presented for Question 5, interpret the ratios from your answer to Qs 4. You should focus your attention on what the ratios mean for investors in the firm which you are observing (all types of investors).

(300 words)

[15 marks: 5 marks each]

 

Ratios can be procured from FAME, a text book or calculated from the final accounts. When you calculate ratios, you must show your calculations and formula used. The assignment must be submitted via BlackBoard, and presented with the similarity report produced by the software. All calculations or sources, such as FAME must be appended in your report.

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A useful way of obtaining a set of accounts for a quoted plc is to access FT.com on the internet and click on “free annual reports” under “related services”.

 

General guidelines

Guidance regarding word limits is given for each question within brackets. The word limit is a strict guideline and relates to maximum words in each question. You should write number of word used after every question. If would be preferable if you could answer briefly using tables or figures.

 

Ensure that your work is fully and appropriately referenced. Use good quality academic references where possible (not Wikipedia or Investopedia, for example.)

Demonstrate evidence of wider reading.

Qualities looked for in your submission are:

• Good Presentation
• Referencing and use of contemporary material
• Use of theoretical tools
• Description and analysis in general
• Intelligent comment and interpretation

Use titles and sub-titles appropriately, also ensure that you write succinctly and use figures and tables to illustrate your work if appropriate.

 

The work should be presented in Times Roman 12 font and should be double spaced. Page Numbers must be added.

An indicative guide to the application of marks to this assignment is as follows: