Task 4. a) Financial Analysis (graded: worth 45%)
The Board of directors has asked you to perform a review of the financial performance and financial position of the business based on the company’s 2033 financial statements and key financial ratios, and using any other available information which you consider to be relevant.
Required:
Prepare a report for the Board of Directors in which you analyse the company’s financial performance and financial position and which specifically addresses the company’s profitability, efficiency, liquidity and stability.
Word limit: 1,200 words (excluding tables and appendices)
Task 4. b) Variance Analysis (pass/fail: worth 2.5%)
After receiving your 2033 results.
Required
Complete the following tables to provide an analysis of actual performance against budget for 2033. .
You should flex the sales revenue according to the actual quantity of sales. You should flex the raw materials costs according to the actual quantity of production (which might not necessarily be the quantity you recorded on your decision form!). Take care with the other costs!
Revenue:
Budget Actual Variance
Sales Quantity (Units)
Budget Flexed Budget Actual Variance
W$ 000 W$ 000 W$ 000 W$ 000
Sales revenue
Costs:
Budget Actual Variance
Production Quantity (Units)
Budget Flexed Budget Actual Variance
W$ 000 W$ 000 W$ 000 W$ 000
Raw Materials Costs
Direct Labour
R&D
Marketing
Administration
Overheads
Net financial cost (interest payable)
Based on your analysis of actual v budgeted performance for 2033, identify the 3 variables which have changed during 2033 from what you had expected and briefly record how they have changed.
Record the Variable Here Record How it Has Changed Here
Variable 1
Variable 2
Variable 3
