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MG5556 Financial Resources Management

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Assessment Title: Analysis of financial performance and valuation of two FTSE 350 companies
Module Leader: Dr Radha Shiwakoti
Distribution Date: 14/01/2019
Submission Deadline: 12:00 noon on 25/03/2020
Feedback by : 30/04/2020 (20 working days after the submission the deadline.)
Contribution to overall module assessment: 100%
Indicative student time working on assessment: Hours
Word or Page Limit (if applicable): 3 000 Words (not including references)
Assessment Type (individual or group): Individual Report

Main Objective of the assessment

The main objective of this assignment is to examine the ability of the students to critically evaluate the financial performance and position of a company and their ability to value the company using a valuation method. This objective will be achieved through the preparation of financial and valuation report of a large listed company in the London Stock Exchange. In the preparation of the report student must demonstrate a critical understanding of the theories and concepts pertaining to the creation of shareholder value and the evaluation of the performance of a company. In this assignment students should use appropriate concepts and rational arguments to interpret strategic and financial data in order to produce suitably critical, well-considered report.

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Description of the Assessment

This assignment is based on companies listed on the London Stock Exchange (LSE). You are required to prepare a report comparing the financial performance and position of two companies over the last five years and also required to prepare a valuation report using one valuation method. Please select two companies from the list of FTSE 350 companies from the following sectors:

  • Construction
  • Information and Communication
  • Mining and Quarrying

You can get list of FTSE 350 companies from the London Stock Exchange website. http://www.londonstockexchange.com/exchange/prices-and-markets/stocks/indices/constituents-indices.html?index=MCX

You can get UK industry classification from the following:

https://www.gov.uk/government/publications/standard-industrial-classification-of-economic-activities-sic (UK SIC code information)

https://fame4.bvdinfo.com/version-20181219/fame/Companies for FAME Database

Annual reports are available to download from the company’s website and as a scanned copy from FAME. It is also expected that you will collect information from the narrative section of the annual reports and accounts of companies. In addition, some industry data is expected in a good report.

Required:

You should prepare your report in two parts:

  • In the first part, you are required to evaluate and analyse the performance and position of two companies using the ratio analysis and the vertical/horizontal analysis over the last five years. You are expected to use some industry data and information from various sources to support your analysis. Based on your analysis recommend the company which would be a good investment for prospective investor. Your report should cover the following areas:
  • An evaluation of profitability.
  • An evaluation of financial position from both a short-term (liquidity) and a long-term (gearing) perspective.
  • An evaluation of performance from an equity shareholders perspective.
  • An evaluation of the overall performance and position of the business.
  • In the second part, you are required to prepare a valuation for a company using one of the following two methods:
  1. Prospective price-earnings ratio analysis based on forecast normalised earnings.
  • Forecast dividend growth model.

You are required to compare your valuation with the actual market value of the company. You should discuss the advantages and disadvantages of the valuation method you have chosen and the problems that may arise in arriving at valuation to illustrate your points.

Notes:

  1. You should show the calculation of your ratios in sufficient detail to enable your workings to be followed. You should refer to other information in the financial statements (and information available from elsewhere), as necessary, to assist in the interpretation.
  • In preparing valuation, you should state all of your assumptions clearly in your report.
  • Use of research papers/journal articles are encouraged in your report to support your analysis/discussion.
  • Show all your workings clearly for both parts. Avoid copying information from internet sites or other sources. If unacknowledged, this constitutes plagiarism. Please see below ‘Academic Misconduct, Plagiarism and Collusion’ for more detail.
  • Please submit your report on WISEflow not later than 25 March 2020, 12.00 noon.

Target length 3 000 words including calculations. Any report shorter or longer than 10% of 3 000 words will be penalised. Please use Harvard style referencing.

Please enter here the marking scheme relevant for the coursework and provide an illustration of each assessment criterion achieved at each of the grade descriptor for UG/PG levels.

PG grades and grade point bands [Senate Regulation 3 (2013 starters onwards)] are: A++ (17), A+ (16), A (15), A- (14), B+ (13), B (12), B- (11), C+ (10), C (9),

C- (8), D+ (7), D (6), D- (5), E+ (4), E (3), E- (2), F (1)

Marking scheme

Criteria Grade descriptors
  A B C D E F
Literature Review (10%) Clear demonstration of a sophisticated, critical and thorough understanding of the role and nature of financial resource management and its diverse elements of regulation with several appropriate references Clear demonstration of a well-developed, critical and comprehensive understanding of financial resource management the role and nature of and its diverse elements of regulation with some appropriate references. Demonstration of a critical and substantial understanding of the role and nature of financial resource management supported and its diverse elements of regulation with a few references. Provides evidence of some critical understanding of the role and nature of financial resource management and its diverse elements of regulation with at least one reference or few inappropriate references. Work does demonstrate evidence a partial but uncritical understanding of the role and nature of financial resource management and its diverse elements of regulation with no references. Work does not demonstrate understanding of the role and nature of financial resource management and its diverse elements of regulation and there is absence of references
Creativity in the use of Financial Resource Management (10%) Comprehensive critical evaluation is required An evaluation which is comprehensive. A limited but satisfactory evaluation of the areas required. An awareness but limited evaluation of the areas required This answer does not demonstrate an awareness of the area This answer has failed to understand the subject area.
Research Methodology (5%) Comprehensive critical evaluation is required with the research approach fully justified An evaluation which is comprehensive with some justification of the approach adopted A limited but satisfactory evaluation of the areas required. An awareness but limited evaluation of the areas required This answer does not demonstrate an awareness of the area This answer has failed to understand the subject area.
Analytical Skills (60%) An excellent analysis and evaluation of the result drawing information from various sources Good analysis and evaluation of the result. A satisfactory evaluation which lacks the depth and breadth of analysis Very limited analysis of the result. No analysis or discussion provided. No analysis provided and the answer does not address the question.
Overall Structure (15%) Excellent structure , good presentation and Excellent structure , good presentation and Satisfactory overall but the answer contains Poor written presentation and English skills The answer contains very weak Presentation and referencing are
 
appropriate referencing and citations with the submission procedure correctly followed
appropriate referencing and citations examples of poor English grammar and/ or some referencing errors displayed. Some referencing or presentation errors. communication skills, poor referencing and presentation. very poor or non- existent.

Please enter here the marking scheme relevant for the coursework and provide an illustration of each assessment criterion achieved at each of the grade descriptor for UG/PG levels.

Submission Instructions

Coursework must be submitted electronically via the University’s WISEflow system. The required file format for this report is Adobe PDF. Your student ID number must be used as the file name (e.g. 0123456.pdf). You must ensure that you upload your file in the correct format and use the College’s electronic coursework coversheet. Please note that submissions of ‘.pages / .docx etc’ documents will not be accepted and must be converted to approved format.

The electronic coursework coversheet must be completed and included at the beginning of all coursework submissions prior to submitting on WISEflow.

Academic Misconduct, Plagiarism and Collusion

Any coursework or examined submission for assessment where plagiarism, collusion or any form of cheating is suspected will be dealt with according to the University processes which are detailed in Senate Regulation 6.

You can access information about plagiarism here.

The University regulations on plagiarism apply to published as well as unpublished work, collusion and the plagiarism of the work of other students. Please ensure that you fully understand what constitutes plagiarism before you submit your work.

University’s Coursework Submission Policy

Please refer to the College’s Student Handbook for information on submitting late, penalties applied and procedures.

College’s Coursework Submission Policy

Please refer to the College’s Student Handbook for information relating to the College’s Coursework Submission Policy and procedures.

* this can be found at the bottom of the page under the ‘Documents’ section *

Extenuating Circumstances Policy

Please refer to the College’s Student Handbook for information relating to extenuating circumstances and procedures.