Posted: April 12th, 2015

Quantitative Techniques in Business (QTB)

Assignment Question:
The data below has been extracted from the financial statements of Barclays Bank Plc for a 10-year period [2004-2013]

Year RSF(%) ROCE(%) RTA(%) LQR(X) ADMIN EXP(£’m) PAIT (£’m) TAX (£’m)
2013 4.73 4.16 0.22 1.04 30384 963 1577
2012 0.16 0.15 0.01 1.03 18189 -723 483
2011 9.62 8.52 0.38 1.03 19447 3616 1928
2010 10.27 9.43 0.41 1.03 19967 4172 1516
2009 8.15 5.28 0.33 1.05 27142 3512 1047
2008 14.65 7.98 0.29 1.03 21100 5249 786
2007 23.79 13.36 0.58 1.03 17456 5126 1981
2006 28.31 1.26 0.72 0.33 16231 5256 1941
2005 23.43 0.99 0.57 0.36 13468 3872 1439
2004 25.24 16.23 0.88 1.04 10152 3277 1289
Source: FAME (2015), Barclay Bank Plc, Available at: https://fame2.bvdep.com/version-201525/Report.serv?_CID=182&context=2W1YA0YV748SNF9&SeqNr=1 [Online] Accessed on 6th February, 2012 at 17:02pm
Key
RSF (%) Return on Shareholders’ Funds
ROCE (%) Return on Capital Employed
RTA (%) Return on Total Assets
LQ (X) Liquidity Ratio
ADMIN EXP Administrative Expenses
PAIT (£’Millions) Profit After Interest and Tax
TAX (£’Millions) Taxation

Required:
Task 1 : Graphs (Descriptive statistics)
Use relevant graphs to represent each of the following and examine them:
(i) RSF ; ROCE and RTA
(ii) ROCE and LQR
(iii) Admin Exp. And PAIT
(iv) PAIT and Tax

Task 2 : Correlation Analysis
Perform a correlation analysis for RSF; ROCE and RTA and examine the strength of relationship between these profitability ratios.

Task 3 : Regression Analysis
Using profit after interest and tax (PAIT) as the dependent variable, perform a linear regression analysis with administrative expenses and amount paid for the year as tax obligation as the explanatory variables.
Report Writing
1. Introduction [300 words]
o The objectives/ rationale for the assignment should be captured
o The key highlights should be captured etc.

2. Graphical Analysis [600 words]
o Use relevant software tools to draw suitable graphs as specified in the Task 1
o Discuss the nature of the relationship from the resulting graphs
o Your discussion should be supported with some relevant literature

3. Correlation Analysis [800 words]
o Use relevant software to produce a correlation matrix as specified in Task 2
o Examine the strength of relationship between the ratios
o Use relevant literature to support your discussion

4. Regression Analysis [800 words]
o Use relevant software to perform the regression analysis as specified in Task 3
o Examine the resulting model using the relevant mechanisms such as goodness of fit; significance; the model and its interpretation etc.
o Use relevant literature to support your discussion

5. Conclusion and Recommendations [500 words]
o Provide a suitable conclusion and recommendation for the entire discussion
o Ensure your conclusion represents a reflective summary for the discussion

6. Referencing
o Use Harvard referencing style should be strictly followed.
o Ensure your reference list include all citations in the text and others which may not be in the text (bibliography)
o Ensure that your references are coming from quality sources such as articles; textbooks and other peer-reviewed journals

Note: Reference List ; Tables and Figures are not part of the word count

Some Recommended Text
o Curwin J. and Slater R. (2007) Quantitative Methods for Business Decisions, (5thedn) Chapman& Hall

o Wisniewski, M (2010) Quantitative Methods for Decision Makers, (5th edn) FT Prentice Hall

o Lucey T (2002) Quantitative Techniques, Thomson Learning

o Oakshott L (2006),Essential Quantitative Methods for Business, Management and Finance, (3ndedn) Palgrave Macmillan

o Swift, L, Piff, S. (2010) Quantitative Methods for Business, Management and Finance, (3rd end) Palgrave

o Field, A. (2009). Discovering statistics using SPSS. Sage publications.

o Sekaran, U. (2006). Research methods for business: A skill building approach. John Wiley & Sons.

Marking Scheme
Component Maximum Marks(%) Comments
Introduction 5 An excellent introduction should provide clarity on the relevance of the report. It should also address the key highlights to be discussed in the report. One or two references should be included to add quality to presentation.

Graphical Analysis 20 An excellent presentation should clearly label the axes; the use of an appropriate scale; and proper titles given to graphs. The Discussion of the relationships with the aid of the trend will be the major indicator here.

Correlation Analysis 20 Candidate should demonstrate a clear understanding of the concept of correlation. Weak; Strong; Moderate and significant correlations should be given attention.

Regression Analysis 30 The interpretation of the regression output is the major focus for this component. Candidate should demonstrate their ability to link theory with the practice.

Conclusion & Recommendation 15 An excellent conclusion should provide a reflective summary of the entire presentation. Also the recommendation provided should be based on the findings of the analysis.

Overall Presentation 10 Referencing; grammar; visuals and formatting. The word count will also be taken into consideration.

Total 100