Accounting and Managerial Finance

LSBF
Module Accounting and Managerial Finance
Assignment
Title
AMF Written Coursework Assignment
Assignment
Type
Individual Assignment
Word Limit 3,500 – 4,000
Weighting 100%
Issue Date 1st June 2020
Submission Date 6th July 2020
Feedback Date 19th – 21st August 2020
Issued by
(Assessor)
Sherrihan Radi
Internal Verifier Shahnaz Hamid
Plagiarism When submitting work for assessment, students should be aware of the
LSBF guidance and regulations concerning plagiarism. All submissions should
be your own original work.
You must submit an electronic copy of your work. Your submission
will be electronically checked.
Harvard
Referencing &
Special
Instructions
The Harvard Referencing System must be used. The Wikipedia website
must not be referenced in your work.
You are allowed to upload only ONE attachment (e.g. an Excel sheet) in
addition to your original assignment, unless there is a requirement for more
than one document in the assignment brief.
You must upload your assignment in PDF or Word document format. Your
paper will not be graded if it is submitted in any other format.
If you submit your assignment as a PDF version, please include the exact
word count of the assignment on the title page.
Learning
Outcomes
On successful completion of this assignment you will be able to:
1. Summarise key principles, trends and tools in accounting and
corporate finance.
2. Demonstrate effective approaches to the analysis of corporate finance
structure and analysis of corporate financial statements.
3. Assess the value of practical value of models and theories on making
decisions on corporate financing in context.
4. Critically evaluate the benefits of various types of financing for
different kinds of organisations.
5. Utilize internal and external financial information to appraise business
performance.
Grading Criteria Postgraduate Grading Criteria for this assignment is available at the end of
this document.
Your Task Question one of the individual assignment is to perform a detailed financial
analysis of a listed company using key financial ratios and analysis of
company financial statements. Critical evaluation of the financial health of the
company, including the company’s approach to working capital management,
should be submitted.
Question two of the individual assignment is to prepare a report to the
investment board of Britvic Plc that recommends the appropriate funding
choice for an investment project that will be evaluated based on the
information provided below for question two.
Important: The two components of this assessment are independent of
each other.
Question 1 – 50%
Using the following link, https://www.britvic.com/media-centre/reports,
download the annual reports of Britvic Plc from 2017 to 2019 and provide a
critical analysis of the financial health of the company. The annual reports are
in a consolidated format, and relevant financial statements can be found
under the financial statements section. Do not forget to review the notes to
the financial statements. (This report should be a minimum of 2,500 words
of the total word count.)
Required:
a) Write a brief introduction of the company and the current mid-term (5
years) outlook. Maximum of 300 words. Be sure to include an analysis of
the company’s share price to the present.
[5 marks]
b) Calculate Britvic Plc’s key financial ratios (for at least the 3 most recent
years) and present them in the report in table or chart format. Key ratios
must cover all categories: profitability, liquidity, efficiency, investment,
and gearing (leverage) ratios.
[15 marks]
c) Interpret and assess the trend of the financial performance of Britvic Plc
in the most recent year (the newest annual report) in comparison to
the previous years as well as its competitor/industry. Make sure you justify
any significant differences (trends) you observe here.
[20 marks]
d) Critically assess the company’s approach to working capital management.
[10 marks]
Notes: The accompanying analysis should be detailed and provide reasons
for any changes. Use both internal and external (financial and non-financial)
information to support your analysis. Simply stating that a certain ratio has
changed and by how much is not sufficient for analysis at this level. All
equations and findings must be included in the report.
[Total Q1: 50 marks]
Question 2 – 50%
Britvic Plc is currently evaluating a new project to produce canned coffee
drinks. The project will require an initial outlay of £45m on production
machinery and other costs. The project is expected to have a three-year life
span, and the projected cash flows associated with the project are displayed
in the below table:
Table 1: Britvic Plc potential project’s cash flow information
All figures in £’m 2021 2022 2023Sales 1,800 1,950 2,000COGS (990) (1,073) (1,100)Gross Profit 810 878 900Operating Expenses (73) (80) (82)EBITDAa 737 798 818Depreciation (7) (7) (7)EBITa 730 791 811Tax Expense (131) (142) (146)EBIATa 599 648 665CAPEXb 3 3 3Investment in Working Capital 0 0 (2)aEBITDA: Earnings Before Interest, Taxes, Depreciation and Amortisation
EBIT: Earnings Before Interest and Taxes
EBIAT: Earnings Before Interest and After Taxes
For simplicity, taxes are calculated assuming no interest expensebAnnual capital expenditures in addition to the initial outlay, and assumed to cease at the end of
the project