Manage financial about BT plc

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REQUIRE.docx

Indicative marking guide

Fail

(0%-49%)

Pass

(50%-59%)

Commendation

(60%-69%)

Distinction

(70%-100%)

Question 1

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.

Question 2

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.

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.

Question 3

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.

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