International Foundation Programme (Business) Business Operations Assessment Brief – Financial Analysis Assessment You are the financial accountant for Elite plc. Your colleagues in the Finance Department have prepared the summary of the accounts of Elite plc for the two years 2018 and 2019. As financial accountant you are asked to prepare a report using the correct layout. You are writing the report for Senior Management who are non-accountants. Your report should contain the following: An Introduction (10 marks) Calculations for the following ratios for each of the two years: Gross Profit Ratio (10 marks) Operating Profit Ratio (10 marks) Return on Capital Employed (10 marks) Current Ratio (10 marks) Acid Test Ratio (10 marks) Trade Receivables Turnover (10 marks) Trade Payables Turnover (10 marks) Non-Current Asset Turnover (10 marks) In each section, you should state the formula and what it is used to show, you should show the figures being inserted into the formula. After each ratio calculation you should explain the result by comparing the results for each year. You must clearly state whether the result is better or worse than the previous year. Comment on the result and when the result is worse than last year you must recommend to senior Management, who are non-accountants, what should be done to correct the situation and cause an improvement. Report Layout, presentation, spelling and grammar (10 marks) A summary of the final accounts of Elite plc for the last two years is presented below: Income Statement (Extract) for the year ended 31 March 20182019 ££Sales3,000,0005,400,000Less: Cost of Sales2,400,0004,320,000Gross Profit600,0001,080,000Less: Expenses360,000500,000Operating Profit240,000580,000 Statement of Financial Position (Extract) as at 31 March 20182019 ££Non- Current Assets364,000512,000Current Assets Inventory480,0001,440,000Trade Receivables396,000812,000Total Assets£1,240,000£2,764,000Capital & Reserves Ordinary Share Capital140,000240,000Reserves260,000560,000Non-Current Liabilities440,000500,000Trade Payables320,000724,000Bank Overdraft80,000740,000Total Equity and Liabilities£1,240,000£2,764,000 Assignment Instructions Your assignment should be presented using a standard academic format and should not include any images unless relevant to answering the question. You should include a reference list at the end of the assignment which should be referenced using the UWS Harvard Referencing guide. Please follow the wordcount guideline above in the assessment brief Any work that you submit must be your own and the use of sources must be referenced appropriately. Any work that is deemed to be plagiarised or not the student’s own work will not be marked and will not count towards the final module grade. Deadline: Monday 19th April 2021 at 17.00 Assignments must be submitted electronically via the Turnitin application in the appropriate section of the Business Operations Moodle module. Your tutor will provide you with full instructions on how to upload your essay.
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