Introduction to Accounting and Finance
The requirement is to produce a report on the financial position of a Public Limited
Company of your choice using ratio analysis.
The rules are:
Report length c1500 words excluding appendices
It must be submitted no later than 3pm on Wednesday 21 March 2007
Submission to School of Management Reception
You will need to obtain a company report. This can be done either from reports in the
Library, through downloading reports from the Internet or through ringing up the Investor
Service in the back of the Financial Times, who supply reports free through the post.
Look online at http://ft.ar.wilink.com/asp/P003_search_ENG.asp You need to keep the
report relevant and could use ratios from another company in the same sector as a
comparator for the results you have calculated. OK, I know if you print a whole report it
is going to cost money! Excuse me the thought made me feel a little weak, but it is
worth getting the complete report for the background information it can furnish.
As a guide I have provided some ideas on writing the report.
You may not have prepared a ‘professional’ style report before, so here are a few
The report should contain the following:
1. Title page (title of report, date, possibly the author)
2. Contents page (headings of the following sections, with page references)
3. Executive summary (brief summary of scope of report and main findings, imagine
you are writing for a busy chief executive)
4. Terms of reference (restate the requirements for the report, possibly mention your
methodology e.g. ‘using ratio analysis’)
5. Introduction (could contain background information on the company analysed, should
split into several sub-sections if necessary)
6. Several separate sections for e.g. overview of financial performance and position (e.g.
the company’s profits have grown at a rate of 5% over the past 5 years but the
company has been losing cash, 50% of sales are made in Europe, etc.), discussion of
profitability, working capital, etc. ratios. Refer to calculated ratio figures where
appropriate, BUT DO NOT INCLUDE ACTUAL CALCULATIONS HERE.
7. Conclusion (of main findings - do NOT put anything new in your conclusion)
8. Appendices (containing your ratio - and any other - calculations)
You should aim to calculate a couple of ratios in each category, but you need not be
limited to this. ALWAYS CALCULATE RATIOS FOR MORE THAN ONE YEAR - it
is important to be able to compare ratios against something!
Do not be afraid of using sources like the Financial Times or the internet to find out
background information on the company to include in your report. Make sure you have a
good read of the whole set of financial statements provided for you including the
directors’ report which often gives you useful background information.
Use CONSOLIDATED figures where applicable - these are for the whole group of
companies not just the individual parent holding company. YOU DO NOT NEED TO
KNOW HOW TO CALCULATE THE CONSOLIDATED FIGURES YOURSELF.