MSc Finance

MSc Business Management

MSc International Management
MSc International Trade and Logistics
MSc Business & Marketing Management
MSc Business Management & Finance Program
MSc Business Management & Entrepreneur Program

ACFI6004 Finance and Accounting for Business

Assignment: Semester 2 2020-2021

This assignment is in two parts.

Task-1 Individual work- calculations (20%)

Task-2 Individual work- report writing (80%)

Learning Outcomes assessed

1. Use basic accounting terminology and techniques to prepare and analyse published
financial accounting information

2. Demonstrate an ability to prepare basic management accounting information

3. Critically assess the techniques and processes used in accounting

4. Communicate financial information both orally and in the written form

Objectives

Both tasks account for 100% of the marks for this module.

In the calculations task (20%) you will demonstrate how to calculate and prepare basic management
accounting information using budgeting, ratio analysis and investment appraisal techniques

In the report task (80%) you will demonstrate how to interpret the numbers to make the information
useful for managers and investors.

Both tasks encourage research and financial analysis. It also develops and demonstrates an
understanding of the decisions based on budgeting, investment appraisal techniques and ratio
analysis.
Calculations Task (20%).

Required:
a) Using the provided financial statements of Greggs plc for the year ended 28 December 2019,
you are required to select and calculate an appropriate set of ratios to assess the business.
6 marks

You should clearly show all the formulae and calculations. The figures should be rounded to two
decimal places.

b) Tekna Electronics is planning to manufacture one specialised battery for underwater

cameras. The Managing Director of the company has called a meeting to evaluate an
investment in new production machinery needed for battery manufacturing. The Managing
Director is not sure which machine to invest in. He needs to choose from 3 different
machines. The cash flow details, Life of the machines and the purchase prices are as follows.

Machine A Machine B Machine C

Initial investment 440,000 525,600 884,600

(£)

Life of the 4 years 5 years 3 years

machine

In each case the initial investment represents the purchase of plant and equipment whose
residual value will be 20% of initial cost, receivable in addition to the net cash flow, at the
end of the life of the project. Forecast sales volume, selling price and other costs are as
follows;

Sales volume Selling price per Variable cost per Fixed cost per
(units/year) unit (£) unit (£) annum (£)

Machine A 1000 600 360 80,000

Machine B 900 600 325 80,000

Machine C 1300 600 285 130,000

 The machine B and C have only recently been introduced to the market and has not been
fully tested in operating conditions. Because of the higher risk involved, the appropriate
discount factor for the machine B and C is believed to 11% per year, 2% higher than the
discount rate for Machine A.

Requirement

For each of the three projects:

I. Calculate the accounting rate of return (based on the average investment method).
3 marks

II. Calculate the payback period. 1.5 marks

III. Calculate the net present value. 3 marks

c) Prepare Tekna’s cash budget from July 2021 to October 2021 from the following budgeted
data.

Budgeted data July August September October

£ £ £ £

Sales 28,000 30,800 31,600 33,200

Purchases 26,000 25,200 25,600 26,800

Wages 1,200 1360 1,480 1,600

Other overheads 2,200 2,160 2.300 2.360

Capital expenditure 13,000

The following additional information is available:

1- 35% of the customers pay cash and the remainder take 1 month to pay.
2- 45% of the purchases are paid for after 1 month and the remainder in 2 months’ time.
3- Wages are paid in the current month.
4- Other overheads are paid after 2 months.
5- Capital expenditure is paid in the following month.
6- Opening cash balance for July was £5,600 overdraft.
6.5 marks
Additional Guidance

1- Clearly show all the calculations and the formulae used in your calculations and it should be
done MANUALLY rather than copying figures from websites.

2- You must not depend on the disclosed ratios in the annual reports. You are required to
prepare these ratios on your own.

Report writing Task (80%);

Required

a) Using a selection of the ratios calculated in the calculations task, comment on the
profitability of Greggs Plc and discuss how the cash operating cycle can be improved to
increase the profitability of Greggs plc?
40 marks

b) Tekna Electronics is finding budget setting process quite hard. When you add the challenges
of lack of time to create budget and un-certainty in the market, the budget setting process
become very complicated. Even after a budget is created, there can be many factors like
inaccuracies in data, unwillingness to change budget habits, lack of flexibilities etc can lead
Tekna Electronics to digress from the company’s budget. This issue is not only impacting
Tekna’s financial growth but also adversely effecting organisational and management skills.
Panels have been established to decide on the type of budget Tekna Electronic should use
that can provide more accurate and up to date financial information to assist decision
making. Your role is to write a report to the panel briefly explaining different types of
budgets, which type of the budget you think is most suitable for Tekna Electronics and why?

40 marks

Submission date

Your work must be uploaded to the dropbox on Moodle by Wednesday on 21 April 2021 by 13:00.

There is no hard copy submission of your work. For electronic submission of your work:. You can
use any appropriate title for the task but the file name of your work should include your
student number.
Report writing Task - length
The maximum length of the report writing task in the assignment is 2000 words excluding the list of
references, appendices, table of contents, cover sheet, front cover and title page.

Presenting coursework for assessment

Please refer to the module guide for presentation requirements.

Referencing

It is expected at this level that referencing will be complete and accurate, using the Harvard method.
Guides to using the Harvard method are available on the library website ‘Cite them Right’:
https://www.brookes.ac.uk/library/skill/skill1d.html

The Centre for Academic Development offers confidential one-to-one tutorials on study skills,
maths and stats, Academic English modules and courses, writing retreats and a wide variety of
online resources to help you succeed. Find out more at
https://www.brookes.ac.uk/students/academic-development/

If you are still in doubt about referencing or any aspect of your writing, please consult your module
leader.

Marking, moderation and return of coursework and feedback

We will endeavour to mark your assignment within three weeks of submission and provide you with
written feedback on its strengths and weaknesses. If you require any clarification on the written
feedback, it is your responsibility to contact the tutor to arrange this.

Assessments are marked and given clear comments by one member of staff (the first assessor). A
representative sample of these assessments is reviewed by a second assessor(s) from within the
team, usually the module leader. This process may be informed by an analysis of marks given by
each marker averages, ranges etc.

Following internal moderation, a sample of scripts is reviewed by the External Examiner for the
programme to ensure that the standards applied are comparable to those at other institutions.

Use of Turnitin

This assignment will be submitted through Turnitin. Turnitin is a web-based tool that supports the
development of good academic practice when preparing written work for assessment. This text-
matching tool allows academic staff to check assignments for improper use of sources or potential
plagiarism by comparing it against continuously up-dated databases (including web-pages and other
student work).

Formative use of Turnitin is available, and a drop box will be made available on the moodle site.

Authenticating your coursework

Please refer to the module guide for advice on authenticating your coursework

Marking criteria – Report writing task B only.

ACFI6004 Finance and Accounting for Business report writing Task - Assessment criteria

1) Use of literature (Relevance to specified audience/user):

A very good piece of work should show up-to-date, comprehensive and detailed knowledge of
the subject area and where appropriate relevant literature that integrates theory with practice.
Relevant literature may include suggested readings, other textbooks, journal articles,
professional publication and websites. The extent and quality of your sources will be assessed.
(10 marks)

2) Critical approach to sources: (Evaluations & Observations , Recommendations & Conclusions)

A very good piece of work must show the student can effectively critically review evidence, draw
conclusions and suggest ideas to enhance organisational processes and/or theory whilst
recognising contextual limitations.
Your ability to reflect on the set of financial reports you have read will be assessed. You should
be able to identify strong and weak points to support your arguments to invest or not in a given
company. You should also be able to demonstrate your own thinking by presenting an
argument and supporting it by reference to evidence that you have collected. You should draw
conclusions that are logically connected to your argument. (10 marks)

3) Problem solving, application of theory to issues and practice: (Calculations & interpretation of
ratio analysis)
Your ability to select and calculate right set of ratios and demonstrate understanding of issues
raised in the ratios calculated. Your discussion of the issues posed in the question should reflect
your understanding. You should be able to present an argument, outlining alternative views
(derived from your reading and ratio calculations), presenting evidence that supports these and
arriving at a conclusion which you have justified from the literature and from ratios calculated.
Your answer to the question should be clearly focused: read the question carefully and refer
back to it frequently while writing your answer to ensure that you are not wandering off the
 point and including irrelevant material. (15 marks)

4) Presentation:

The task 2 must be presented professionally, communicate key messages and arguments with
convincing substantiation and contain accurate referencing in appropriate format.

This includes consideration of general presentation issues such as the inclusions of a sensible
introduction, page layout, use of paragraphs, accurate spelling, fluency of language and
compliance with presentation instructions. The presentation of citations in the text and
accurate referencing must also be in the correct format. (5 marks)