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analyzing company accounts as an outsider to the company.

Strategic Financial Analysis
COURSEWORK 3000 WORDS (100%)
Companies Selected: Booker and Tate&Lyle
Describe, critically assess and evaluate the principal methods of analyzing company accounts as an outsider to the company.
Indicate the major shortcomings that are inherent in such processes and propose contemporary analysis methods that will limit these shortcomings.
Illustrate your answer with worked examples of dynamic analysis for any two listed companies i.e. Booker and Tate&Lyle.
This assignment is essentially a critical analysis/evaluation of methods of analyzing corporate financial statements. Traditional approaches, such as ratios, trend/horizontal, and vertical comparisons should be briefly described and techniques applied to the financial statements selected Booker and Tate&Lyle.
This should lead to preliminary conclusions on the financial performance and strength of the companies. However, in additional to demonstrating knowledge and application of these techniques, a critical analysis/evaluation of the technique is also required and this will significantly increase the marks earned for this section. The evaluation is supported by reference to relevant academic sources and other research findings. A brief summary of this section would be useful.
The assignment continues with brief descriptions of “contemporary” analysis methods. The likely starting point is the use of “Economic value added”, but it is then for the writer to decide the breadth and depth of methods described. Again, where appropriate, methods are applied to the companies selected above, but it is the critical analysis that earns most of the marks.
(From previous guidance, “The intent of the word -dynamic- is that the student should feel free to pursue analysis that they think relevant, of interest, or of particular research interest in the pursuit of explaining and analyzing performance and financial position.)
The marking grid shows there are 30 marks awarded for coherence of argument and therefore analysis that compares and contrasts findings from traditional and contemporary methods will score heavily, as will clear linkage how contemporary methods might address identified shortcomings of traditional analysis. This should lead to a well-structured and supported set of conclusions.
A clear challenge is keep within the word count, which is relatively short. Two pieces of advice – use an appendix if necessary (not included in word count) and then “write a little about a lot” – better to make many short, concise points, rather than spend paragraphs going into detail on one point.
For a listed company of your choice (Tate & Lyle and Booker) complete a report (using the Olam/Muddy Waters Report as a guide) indicating the major factors which influenced the past three years trading. Justify your answer with appropriate ratios and trend information drawn from the company’s accounts (to include half-yearly data).
Mark
1 Summary of trends over three years 20%
2 Supporting information properly applied and derived 20%
3 Strength and clarity of argument 20%
4 Appropriateness of evaluative techniques 30%
5 Presentation and Style 10%
Total 100%

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