Financial Management Case Study

You are required to work in pairs to write a report with the following title:

An evaluation of the financial management of a real company which is publicly listed in London Stock Exchange since 2015/16 based on an analysis of its Cash Flow Statements.

You should:

  • Outline the main business strategy over this period (20%)
  • Explain briefly, the information content of the cash flow statement (10%)
  • Explain and discuss how the business Directors have managed cash to support the business (business strategy) (15%)
  • Present a description and an analysis of the company’s cash flow statements over the 5 year period (e.g. year ending 2016, 2017, 2018, 2019 and 2020) (15%)
  • You should comment upon the most significant cash flows and significant changes
    • ver time (20%)
  • Come to a judgement on how well the business Directors have managed cash over this period (20%)

Do NOT make recommendations (to whom?) but you can suggest alternative decisions that could have been made.

Do NOT worry about hedging, interest rate swaps and other areas of financial management used to reduce the financial risks attached to borrowing money, currency exchange rates and/or holding cash.

You may want to calculate and comment upon the cash conversion cycle. If you do this, you will need to use the right numbers for trade receivables and trade payables; these can be found in the notes to the accounts (look for the number reference on the Consolidated Balance Sheet). If you cannot find purchases figures, you can use cost of sales (Black and Al-Kilani 2013: 207). The cost of sales figures are reported in the Income Statements.

Maximum word length: 1,500 words. Please include charts, diagrams, ratios and key figures (numbers are not included in the word count). Appendices and the bibliography are not included in the word count. Appendices should be used to support material in the report (for example, by providing evidence and detail of calculations). All key numbers should be in the report as only the report is assessed. So, appendices are NOT an easy way of including lots of extra stuff and getting round the word count!

This is a paired assignment worth 25% of the marks for this module. You are allowed to team up with another student to complete this coursework and you are also allowed to do this individually. In the past few years, we did have some students who self selected to do it individually.

Use the Henley Business School preferred referencing system. For example, citations of anything from Tesco Plc Annual Reports can be given as Tesco (year 201x, p.xx).

Indicative marking criteria (a rough guide only). Please see your handbook for general guidance on assessment criteria. More specific criteria will be based on how well you have analysed the cash flow statements. This will include the identification of key cash flows and significant changes; accuracy and presentation; interpretation. Good reports will demonstrate a reasonable understanding of the importance of cash generation and the use of cash in supporting business performance.

Better reports will provide evidence of higher level skills of analysis and evaluation based on research, the analysis of the cash flow statements and a sound understanding of the business (business strategy). Reports should be concise and precise, structured clearly and written lucidly. Presentation is important especially as numbers are a key element of the report.

Submission: ONE electronic copy per pair (please ensure that both student ID numbers are on the report). Turnitin will accept one file only. If you have used a spreadsheet, you will need to copy this into your word file.