HC2091: Finance for Business

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HC2091: Finance for Business

Trimester 2 2018

Group Assignment

Assessment Value: 20%

Due Date: Sunday 23:59 pm, Week 10

Group: 2- 4 students

Length: Min 2500 words

INSTRUCTIONS

Students are required to form a group to study, undertake research, analyse and conduct academic

work within the areas of business finance covered in learning materials Topics 1 to 10 inclusive.

The assignment should examine the main issues, including underlying theories, implement

performance measures used and explain the firm financial performance. Your group is strongly

advised to reference professional websites, journal articles and text books in this assignment (case

study).

Tasks

This assessment task is a written report and analysis of the financial performance of a selected

listed company on the ASX in order to provide financial and investment advice to a wealthy

investor. This assignment requires your group to undertake a comprehensive examination of a

firm’s financial performance based on update financial statements of the chosen companies.

Group Arrangement

This assignment must be completed IN Group. Each group can be from 2 to maximum 4 student

members. Each group will choose 1 company and once the company has been chosen, the other

group cannot choose the same company. First come first served rule applies here, it means you

need to form your group, choose on company from the list of ASX and register them with your

lecturer as soon as possible. Once your lecturer registers your chosen company, it cannot be

chosen by any other group. Your lecturer then will put your group on Black Board to enable you

to interact and discuss on the issues of your group assignment using Black Board environment.

However, face to face meeting, discussion and other methods of communication are needed to

ensure quality of group work. Each group needs to have your own arrangement so that all the

group members will contribute equally in the group work. If not, a Contribution Statement,

which clearly indicated individual contribution (in terms of percentage) of each member, should

be submitted as a separate item in your assignment. Your individual contribution then will be

assessed based on contribution statement to avoid any free riders.

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Submission

Please make sure that your group member’s name and surname, student ID, subject name, and

code and lecture’s name are written on the cover sheet of the submitted assignment.

When you submit your assignment electronically, please save the file as ‘Group Assignment-

your group name .doc’. You are required to submit the assignment at Group Assignment

Final Submission, which is under Group Assignment and Due Dates on Black Board.

Submitted work should be your original work showing your creativity. Please ensure the self-

check for plagiarism to be done before final submission (plagiarism check is not over 30% of

similarity, except the cases where the similarity is reflected by using the same format of

Holmes’ assignment, the same references or sources of data) in accordance with SafeAssign

Student Guide in Black Board. Please note that it takes 48 hours for the self-check report to

be available for your viewing.

Always keep an electronic copy until you have received the final grade for the Unit. Please

make sure that you submit the correct file. Any appeal relating to submitting wrong files

after the deadline will not be considered.

Deadlines

Registration of groups and chosen companies: 5 pm Friday, Week 4

Final Submission of Group Assignment: Midnight (23:59 pm.) Sunday, Week 10

Late submission incurs penalties of 5 (five) % of the assessment value per calendar day unless

an extension and/or special consideration has been granted by the lecturer prior to the

assessment deadline.

BACKGROUND

You’re a group of investment analysts who work for a large investment consulting firm based in

Australia. There’s one big institutional investor from overseas that is interested in investing in the

Australian market. You’ve been asked to choose a listed company in Australia (in the industry you

think will have the most promising future for investment) then evaluate it and give your client

financial advice on whether or not she/he should include the share of that company in her/his

investment portfolio.

Required:

Create your group’s “business name” under which your group will be providing the financial

advisory services. Choose one listed company that your group will investigate/analyse for the

purposes of possible recommendation to your client. The group should obtain all information about

the selected company from this web site: www.asx.com.au.

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Obtain a copy of the last two financial years (2015-2016 and 2016-2017) Financial Statements of

the chosen company (annual reports are accessible via company websites). Your group can

downloaded these documents from the suggested web site using the firm’s code (example, BHP-

for BHP Billiton Company, etc.). Your selected company will be evaluated based on the five

aspects to determine whether it is fundamentally financial healthy. The five (5) aspects include:

liquidity, financial leverage, asset utilization, profitability and market value

1.Description of the

companies

Prepare a brief description of the selected company, outlining the

core activities, competitive advantages, and the market in which

it operates within and any factors in the company’s history which

you consider help present a “picture” of your chosen company.

2 marks

2.Calculation and

analysis of

performance ratios

Using financial data obtained from current financial statements of

your selected company for the given 2 years to calculate the

following ratios and present them in relevant charts or table.

Provide analysis and justify your opinions using the data:

- Short term solvency (Liquidity ratios)

- Long term solvency (Financial Leverage ratios)

- Asset utilization (efficiency or turnover ratios)

- Profitability ratios

- Market value ratios

5 marks

3.Graphs and

comparison of share

price movements

Using the information from the ASX website: www.asx.com.au

to prepare one or more graph displaying movements in the

monthly share prices over the last two years for the chosen

company that you are investigating.

Providing an analysis to compare the movements in the

companies’ share prices to the All Ordinaries Index. For instance,

whether your selected company price trend is more or less volatile

compared to the index? How closely it is correlated with the All

Ordinaries Index, above or below the index?

4 marks

4. Share valuation You are also required to calculate the value of selected company’s

stock above, using the Constant Dividend Growth Rate model. Go

to www.asx.com.au and find the latest share price. Assume the

company chosen above has a 4% dividend growth rate and the

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required rate of return is 9%. Compare the stock value you found

using the model with the current stock market price. Are there any

differences? Explain these differences.

5 marks

5.Consulting Report

After completion of your analysis, you need to present a well-

structured report to your client using appropriate style and language.

Structure of the Report: will include:

1. Title

2. Introduction

3. Table of Content

4. Body (In text citation: paraphrased or quotation to support your arguments)

5. Conclusion

6. Recommendation

7. Reference lists (Harvard Style)

4 marks

Academic Writing, Referencing and Plagiarism

Presentation of written work

The report must have an academic written structure including an introduction, body and

conclusion.

▪ Use numbers to structure body of the report (e.g., “2.5. Research via the internet”).

▪ Provide an explanation on each of these issues (points) and explain how they confirm the underlying financial management theory.

▪ You are required to use Times New Roman font, size 12 with 1.5 line spacing.

▪ Please insert page numbers into your assignment and use 3 cm margins.

A high standard of work is always expected, so poorly presented work may be returned unmarked

with a request to re-submit.

Referencing

When writing your assignments, a reference must be included every time you use someone else’s

ideas or information. In-text referencing of ALL sources, whether academic books, journal

articles, newspaper articles, material from the Internet etc., must be cited in the main text of the

assignment itself. Harvard Style referencing is required for this assignment. A reference must be

included when you:

• Paraphrase (express someone else’s idea in your own words).

• Quote (express someone else’s idea in their exact words).

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• Copy (financial statement, reproduce a diagram, graph or table from someone else’s work).

Example:

Titman, S., Martin, T., Keown, A.J., Martin, J.D, Financial Management: principles and

applications, 7th Edition, Pearson Education, Melbourne, 2016, Australia.

Halili, E, Saleh, A and Zeitun, R (2015), 'Governance and Long-Term Operating

Performance of Family and Non-Family Firms in Australia', Studies in Economics and

Finance, vol.32, no.4, pp.398-421.

History of ASX, viewed Nov 07 2017, https://www.marketindex.com.au/history

Plagiarism, collusion and cheating

Holmes Institute regards most seriously any act of dishonesty in assessments such as plagiarism,

collusion, cheating, re-submission of previously marked work in different units, examination

misconduct and theft of other students’ work.

In short:

‘Plagiarism’ means to take and use another person’s ideas and pass these off as your own by failing

to give appropriate acknowledgement, that is, not indicating by referencing that the ideas expressed

are not your own.

‘Collusion’ (or un-authorized collaboration) means joint effort in preparing material submitted for

assessment, between students or others, except where this has not been approved by the lecturer in

charge of the unit.

‘Cheating’ means to obtain an unfair advantage in an examination or in other written or practical

work required to be submitted or completed by a student for assessment. If the passing off was

done intentionally, you have cheated; if it was unintentional, the offence you have committed is

the academic misdemeanor of failing to reference a source correctly.

Acts of dishonesty in assessment could result in penalties including failure in the Unit and possible

exclusion from Holmes Institute. If you are unsure about this, please speak to your lecturer.

CRITERIA FOR GROUP ASSIGNMENT ASSESSMENT

Content Unsatisfactory

(0-49% marks

given)

Limited

Demonstration

(50-60% marks

given)

Proficient

(61-79% marks

given)

Exemplary

(80%-full marks

given)

1 No specific data

and information

provided to

answer the

questions;

Limited data and

information

provided to

answer the

questions;

Adequate data

and information

provided to

answer the

questions;

Outstanding data

and information

provided to answer

the questions;

Independent and

deep analysis,

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No research basis

for analysis;

Merely relying on

secondary data

from internet;

No reference.

Limited research

conducted;

Limited

references;

Reasonable

research

conducted;

Issues are

discussed based

on sufficient

research and in

relation to each

other;

Adequate

references in

proper

referencing style;

based on wide

research;

Issues and factors

are presented and

analyzed in a

logical

interconnectedness;

Broad and credible

sources of

references in

proper referencing

style.

2 and 4 Calculations are

not demonstrated

for the required

financial

fundamental

ratios,

Proving no

explanation of

implications of

the ratios;

Single year

analysis.

Calculations are

limitedly

demonstrated;

Financial ratios

are provided but

not sufficiently;

Providing limited

analysis of the

ratios;

Inconsistent time

period of analysis.

Adequate

demonstration of

calculations;

Ratios are derived

with relevant

implications and

explanation;

Justification and

assumptions are

clear;

Consistent 2 year

analysis.

Calculation and

presentation are

demonstrated

clearly;

Ratios are derived

and justified with

exemplary analysis

that based on

current issues and

key factors;

Implications and

explanation are

provided

convincingly

Consistent 2 year

analysis and

properly justified

for inclusions or

exclusions.

3 Providing no

graphs of share

price of the

chosen company

No adequate

analysis and

Providing graphs

of share price but

not in relevant

time frame;

Limited analysis

and comparison of

the share price

Providing

adequate graphs

of share price of

the chosen

company

Indicating clearly

the movements of

share price

Providing well

established graphs

of the chosen

company’s share

price, which shows

obvious price

trends in the given

time frame

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comparison of

price trend

No relevant

research and

referencing

trend with All

Ordinaries Index;

Limited research

conducted,

inadequate

referencing

Relevant analysis

comparison with

All Ordinaries

Index with

justification

based on reliable

data within

proper time

frame;

Adequate

research

conducted with

relevant

referencing

Analyzing and

comparing the

chosen share price

with All Ordinaries

Index with

exceptional good

justification and

data based analysis

Outstanding

research is

conducted with

wide based sources

and proper

referencing

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Providing no

recommendations

or inadequate

recommendations

for investment

decisions;

No relevant

justification using

data and

information

derived from the

analysis of

financial

statements;

Failing to meet

the requirements

of academic

writing in terms

of structure,

presentation,

Addressing

limited

recommendations;

Demonstrating

limited

justification and

analysis of the

given

recommendations;

Demonstrating

limited skills of

academic writing

in terms of

structure,

presentation,

wordings and

referencing

Presenting

adequate

recommendations

that properly

supported by

justification and

analysis;

Data and

information

derived from

financial analysis

completed are

properly used to

support the

recommendations

Demonstrating

the ability to

present the ideas

in proper

analytical and

contextual level

Presenting a wide

ranges of adequate

recommendations

that exemplarily

supported by

justification and

analysis;

Using data and

information

derived from

financial analysis

completed in an

efficient, analytical

and logical

manner;

Demonstrated a

high level of

understanding and

skills of academic

writing by means

of criticism, logical

argument, and

interpretation of

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wordings and

referencing

data and

information.