Manage financial about BT plc
Indicative marking guide
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Fail (0%-49%) |
Pass (50%-59%) |
Commendation (60%-69%) |
Distinction (70%-100%) |
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Question 1 |
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A lack of breadth and depth of financial analysis techniques accompanied by incorrect formulae or calculation without appropriate explanation. Poor layout or presentation in anything other than business report style. Inadequate grammar and lacking in overall knowledgeable synthesis. |
Evidence of some financial analysis techniques but with errors of formulae and calculation with insufficient explanation and adequate presentation. Attempt at a business report format with some supportive appendices. Mainly descriptive with some attempt at synthesis. Grammar and structure being adequate. |
Wide range of financial analysis techniques evident and supported by full disclosure of formulae and accurate calculation in a clear format. Presented in business report format and coherently structured. Supported by referenced appendices. Effective and well-reasoned narrative discussion. |
An excellent range of financial analysis techniques which are supported by full disclosure of formulae and accurate calculation in a clear format. Excellent business report format and well structured. Supported by fully referenced appendices. Excellent analytical and justified explanations showing synthesis and application. |
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Question 2 |
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A lack of understanding of management accounting and decision making. Unable to produce the correct format and calculations. Limited or no narrative discussion or recommendations and conclusions. Poor academic writing and referencing.
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Ability to apply some management accounting decision making techniques. Demonstrates an adequate understanding of the principles and techniques involved. Reasonable attempt at analysis and discussion of findings, though of limited depth. |
A good application of management accounting for decision making. Demonstrates a good understanding of the principles and techniques involved. Good analysis and discussion of findings, with good use of academic references which support clear and well explained conclusions. |
Excellent application and understanding of management accounting for decision making. Thorough and detailed critical discussion with excellent use of a range of academic references which support clear, practical, and well explained recommendations and conclusions. |
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Question 3 |
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A lack of understanding of the topic and the related literature. Limited or no narrative discussion or recommendations and conclusions. Poor academic writing and referencing.
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Ability to research and apply theory to a reasonable degree. Demonstrates the ability to critically evaluate and make the appropriate conclusions. Reasonable attempt at analysis and discussion of findings, though of limited depth. |
A good understanding of the topic. Demonstrates a good understanding of the principles and techniques involved. Good analysis and discussion with good use of academic references which support clear and well explained conclusions. |
Excellent understanding of the topic. Thorough and detailed critical discussion with excellent use of a range of academic references which support clear, practical, and well explained recommendations and conclusions. |
Question 1
Presented below are the simplified Consolidated Statement of Comprehensive Income and Consolidated Statement of Financial Position of BT Group plc for the financial years 2015 to 2017.
Required
Prepare a business report for the attention of the board of directors which analyses the performance and financial position of BT Group plc over the financial years 2015 to 2017 and recommend any action the board should take.
Your report should utilise key ratios, horizontal and vertical analysis and include in-depth critical discussion with appropriate academic references.
Marking guide
Financial analysis (using 4 categories of ratios and vertical and horizontal trend analysis) Vertical trend analysis 4 marks
Horizontal trend analysis 4 marks
Profitability ratio analysis 6 marks
Liquidity ratio analysis 6 marks
Efficiency ratio analysis 6 marks
Gearing ratio analysis 6 marks
________
Total for analysis 32 marks 32 marks
Interpretation with academic references
Vertical analysis narrative 1 marks
Horizontal analysis narrative 1 marks
Profitability narrative 2 marks
Liquidity narrative 2 marks
Efficiency narrative 2 marks
Gearing narrative 2 marks
________
Total for interpretation 10 marks 10 marks
Conclusions and recommendations 6 marks
Layout, structure, grammar and referencing 2 marks
Total 50 marks
BT Group plc
Statement of Comprehensive Income 201720162015
for the Year ended 31
st
March£m£m£m
Revenue
24,06219,01217,968
Operating costs(20,895)(15,399)(14,566)
Operating profit / (loss)3,1673,6133,402
Finance expense (817)(749)(876)
Finance Income133717
Net finance expense(804)(712)(859)
(9)6(1)
0025
Profit / (Loss) before taxes (PBT)2,3542,9072,567
Taxation(446)(441)(510)
Profit for the year1,9082,4662,057
(2,164)698(794)
(256)3,1641,263
Earnings per share (EPS)
Basic19.2%28.5%25.5%
Diluted19.1%28.2%25.1%
Share of post tax loss of associates and joint
Profit on disposal of interest in associates and
Other comprehensive (loss) income for the
Total comprehensive (loss) income for the
Sheet1
| BT Group plc | ||||
| Statement of Comprehensive Income | 2017 | 2016 | 2015 | |
| for the Year ended 31stMarch | £m | £m | £m | |
| Revenue | 24,062 | 19,012 | 17,968 | |
| Operating costs | (20,895) | (15,399) | (14,566) | |
| Operating profit / (loss) | 3,167 | 3,613 | 3,402 | |
| Finance expense | (817) | (749) | (876) | |
| Finance Income | 13 | 37 | 17 | |
| Net finance expense | (804) | (712) | (859) | |
| Share of post tax loss of associates and joint ventures | (9) | 6 | (1) | |
| Profit on disposal of interest in associates and joint ventures | 0 | 0 | 25 | |
| Profit / (Loss) before taxes (PBT) | 2,354 | 2,907 | 2,567 | |
| Taxation | (446) | (441) | (510) | |
| Profit for the year | 1,908 | 2,466 | 2,057 | |
| Other comprehensive (loss) income for the year, net of tax | (2,164) | 698 | (794) | |
| Total comprehensive (loss) income for the year | (256) | 3,164 | 1,263 | |
| Earnings per share (EPS) | ||||
| Basic | 19.2% | 28.5% | 25.5% | |
| Diluted | 19.1% | 28.2% | 25.1% |
BT Group plc
Statement of Financial Position201720162015
as at 31st March
£m£m£m
Non-current Assets
Intangible assets15,02915,4503,170
Property, plant and equipment16,49815,97113,498
Derivative financial instruments1,8181,4621,232
Investments444644
Associates and joint ventures312426
Trade and other receivables360218179
Deferred tax assets1,7171,2471,559
Total Non-Current Assets35,49734,41819,708
Current Assets
Programme rights264225118
Inventories22718994
Trade and other receivables3,8353,9783,093
Current tax receivable736565
Derivative financial instruments42817797
Investments1,5202,9183,523
Cash and cash equivalents528996848
Total Current Assets6,8758,5487,838
Total Assets
42,37242,96627,546
Equity
Ordinary shares499499419
Share premium1,0511,0511,051
Own shares(96)(115)(165)
Merger reserve6,6478,422998
Other reserves884685502
Retained loss(650)(430)(2,124)
Total Equity8,33510,112681
Non-Current Liabilities
Loans and other borrowings10,08111,0257,862
Derivative financial instruments869863927
Retirement benefit instruments9,0886,3827,583
Other payables1,2981,106929
Deferred tax liabilities1,2401,262948
Provisions536565422
Total Non-Current Liabilities23,11221,20318,671
Current Liabilities
Loans and other borrowings2,6323,7362,314
Derivative financial instruments3448168
Trade and other payables7,4377,4185,348
Current tax liabilities197271222
Provisions625178142
Total Current Liabilities10,92511,6518,194
Total Equity and Liabilities
42,37242,96627,546
Sheet1
| BT Group plc | ||||
| Statement of Financial Position | 2017 | 2016 | 2015 | |
| as at 31st March | £m | £m | £m | |
| Non-current Assets | ||||
| Intangible assets | 15,029 | 15,450 | 3,170 | |
| Property, plant and equipment | 16,498 | 15,971 | 13,498 | |
| Derivative financial instruments | 1,818 | 1,462 | 1,232 | |
| Investments | 44 | 46 | 44 | |
| Associates and joint ventures | 31 | 24 | 26 | |
| Trade and other receivables | 360 | 218 | 179 | |
| Deferred tax assets | 1,717 | 1,247 | 1,559 | |
| Total Non-Current Assets | 35,497 | 34,418 | 19,708 | |
| Current Assets | ||||
| Programme rights | 264 | 225 | 118 | |
| Inventories | 227 | 189 | 94 | |
| Trade and other receivables | 3,835 | 3,978 | 3,093 | |
| Current tax receivable | 73 | 65 | 65 | |
| Derivative financial instruments | 428 | 177 | 97 | |
| Investments | 1,520 | 2,918 | 3,523 | |
| Cash and cash equivalents | 528 | 996 | 848 | |
| Total Current Assets | 6,875 | 8,548 | 7,838 | |
| Total Assets | 42,372 | 42,966 | 27,546 | |
| Equity | ||||
| Ordinary shares | 499 | 499 | 419 | |
| Share premium | 1,051 | 1,051 | 1,051 | |
| Own shares | (96) | (115) | (165) | |
| Merger reserve | 6,647 | 8,422 | 998 | |
| Other reserves | 884 | 685 | 502 | |
| Retained loss | (650) | (430) | (2,124) | |
| Total Equity | 8,335 | 10,112 | 681 | |
| Non-Current Liabilities | ||||
| Loans and other borrowings | 10,081 | 11,025 | 7,862 | |
| Derivative financial instruments | 869 | 863 | 927 | |
| Retirement benefit instruments | 9,088 | 6,382 | 7,583 | |
| Other payables | 1,298 | 1,106 | 929 | |
| Deferred tax liabilities | 1,240 | 1,262 | 948 | |
| Provisions | 536 | 565 | 422 | |
| Total Non-Current Liabilities | 23,112 | 21,203 | 18,671 | |
| Current Liabilities | ||||
| Loans and other borrowings | 2,632 | 3,736 | 2,314 | |
| Derivative financial instruments | 34 | 48 | 168 | |
| Trade and other payables | 7,437 | 7,418 | 5,348 | |
| Current tax liabilities | 197 | 271 | 222 | |
| Provisions | 625 | 178 | 142 | |
| Total Current Liabilities | 10,925 | 11,651 | 8,194 | |
| Total Equity and Liabilities | 42,372 | 42,966 | 27,546 | |