Write a one to two paragraphs outlining your informed opinions on the article,for example how will the story impact your decision making as it relates to our weekly topics

Case Study 3: Current Topic of Financial Management

The third case study is not from the textbook. Instead it is a review of a contemporary financial management story from the news. Select one article from the Business Section of the New York Times describing a current financial management issue. For example topics could include financial management issues related to profitability and performance or ethical issues related to company management. Read the article and prepare a 2-3 pages using the following guidelines:

Summarize the article in one paragraph
Write one to two paragraphs relating the article to one of our weekly topics

Write a one to two paragraphs outlining your informed opinions on the article,for example how will the story impact your decision making as it relates to our weekly topics

Be sure to cite the textbook and/or outside relevant resources to support your opinion and cite your article. APA writing style is expected (in-text citations, plus a full-text citation in a References section at the end of the paper).

What areas does your company need to improve and what areas are they doing well based on these ratios?

Case Study Presentation

Step 1:

Identify a public company that you’re interested in exploring for a case study presentation. Go to the company's website and review their annual report and financial statements. After your review prepare a narrated PowerPoint addressing the following points. Please use Excel documents when preparing tables or proformas.

Select two liquidity, two profitability and two debt/leverage financial ratios.

Calculate each ratio for your selected company and compare to industry standards. What areas does your company need to improve and what areas are they doing well based on these ratios? What can they do within their operations to make those improvements?

Identify one potential growth area for your company.

Prepare a proforma income statement based on this estimated growth rate, for example how might it affect revenues and expenses.

How would you recommend your company finance this growth initiative and why?

What are the risks associated with your financing selection?

Review the rubric for this assignment which is listed in this weekly module.

Step 2:

Prepare a 10-15 narrated PowerPoint slide outlining the key points above (see the instructions for creating a narrated PowerPoint). Be sure to cite the sources you've referenced for this PowerPoint using the Intro to APA guide.

What is capital budgeting?Are there any similarities between a firm’s capital budgeting decisions and an individual’s investment decisions?

Case Study 2: Capital Budgeting

BASICS OF CAPITAL BUDGETING

You recently went to work for Allied Components Company, a supplier of auto repair parts used in the after-market with products from Daimler AG, Ford, Toyota, and other automakers. Your boss, the chief financial officer (CFO), has just handed you the estimated cash flows for two proposed projects. Project L involves adding a new item to the firm’s ignition system line; it would take some time to build up the market for this product, so the cash inflows would increase over time. Project S involves an add-on to an existing line, and its cash flows would decrease over time. Both projects have 3-year lives because Allied is planning to introduce entirely new models after 3 years.

Depreciation, salvage values, net operating working capital requirements, and tax effects are all included in these cash flows. The CFO also made subjective risk assessments of each project, and he concluded that both projects have risk characteristics that are similar to the firm’s average project. Allied’s WACC is 10%. You must determine whether one or both of the projects should be accepted.

What is capital budgeting?Are there any similarities between a firm’s capital budgeting decisions and an individual’s investment decisions?

What is the difference between independent and mutually exclusive projects? Between projects with normal and non-normal cash flows?

1. Define the term net present value (NPV). What is each project’s NPV?

2. What is the rationale behind the NPV method? According to NPV, which project(s) should be accepted if they are independent? Mutually exclusive?

3. Would the NPVs change if the WACC changed? Explain.

Define the term internal rate of return (IRR). What is each project’s IRR?
How is the IRR on a project related to the YTM on a bond?
What is the logic behind the IRR method? According to IRR, which project(s) should be accepted if they are independent? Mutually exclusive?
Would the projects’ IRRs change if the WACC changed?

 

Identify the data and computing facilities required and check if they are available.

Amazon VS eBay

A good project allows students to show that they:

Can identify an interesting question associated with a chosen topic and analyse this question;

Know the relevant literature on their chosen topic;

Can demonstrate a good grasp of techniques (statistical, numerical or theoretical) relevant for analysing the question;

Can present the results of their analysis in a clear and convincing manner, within the word limit of 5,000 words (excluding bibliography).

Timeline

Students must submit an one‐page proposal before 6pm on Tuesday 1 December 2020. Your proposal should:

State a draft title for your project;

Provide a brief description / the basic idea of the question you plan to analyse;

Identify the data and computing facilities required and check if they are available.

Identify and explain the scope of three external dispute resolution schemes approved by ASIC for the financial services sector.

FNS40815 Certificate IV in FINANCE & MORTGAGE BROKING

Identify and explain the scope of three external dispute resolution schemes approved by ASIC for the
financial services sector.

What are the main differences, from a purchaser’s point of view, of acquiring a property through private sale and through an auction?

Explain how the mortgage franchisee system operates in Australia.

Did the franchisee analyse the clients’ financial position according to accepted organisational and industry requirements?

Assessment information

You work as a trainee Complaints Officer with XYZ Financial Services Pty Ltd (XYZ).
As part of your training your supervisor has asked you to review a complaint and the subsequent
actions arising from it.complete each of the following steps:

1. How could the franchisee and the lender have used effective communication skills to build rapport with clients Mr & Mrs Jones during the complaints process?

2. Did the franchisee analyse the clients’ financial position according to accepted organisational and industry requirements? Explain your answer.

3. How could the lender change its company policy, with regards to disclosure, so that clients can
rely on informed decisions?

Determine the overall financial strength of the company based on the ratios identified as either strengths or weaknesses.

Financial Ratio Analysis

Part 1:
Summarize the trends in your company’s ratio performance over the 3 most recent years. Be sure to address the following ratios included in Appendix C:
1.Profitability ratios: ROA, ROE, return on investment (ROI).

2. Liquidity ratios: quick ratio, current ratio.

3. Debt management ratios: long-term debt to equity, total debt to equity, interest coverage ratio.

4. Asset management ratios: total asset turnover, receivables turnover, inventory turnover, and accounts payable turnover.

5. Per share: book value per share.

Part 2:
Interpret whether the trend for each ratio (listed in Part 1) is an improvement or a decline in performance for the company.
Create a table that lists each ratio as either a strength or a weakness in the most current year, based on its trend and your interpretation.
Determine the overall financial strength of the company based on the ratios identified as either strengths or weaknesses.
1. Consider all of the ratios discussed so far. Is the company’s strength the fact that the debt management ratios are improving? Or is it that the liquidity ratios are increasing? Is the company’s weakness that the turnover ratios are declining? Or is the company’s weakness that debt management ratios are weakening?

2. Categorize the company’s overall ratio performance as either strong, neutral, or weak, based on your determination from the ratios.

Part 3:
Compare your chosen company’s ratio performance to the industry competitor ratios in the most recent year based on Appendix D. Be sure to address the following ratios included on Appendix D:
1. Profitability ratios: ROA, ROE, gross margin, and net margin.

2. Liquidity ratios: quick ratio and current ratio.

3. Debt management ratios: long-term debt to equity, total debt to equity, and interest coverage ratio.

4. Asset management ratios: asset turnover and inventory turnover.
Create a table that lists each ratio as either higher or lower than the average ratio for the competitors in the industry.

Part 4:
Categorize the company’s overall financial performance as either better than average, average, or worse than average compared to the industry based on the ratios.

Interpret which ratios are the most important and explain your reasoning.

Justify your conclusion based on the table you created,your interpretation of which ratios are the most important, and the company’s overall ratio performance compared to the industry competitors.