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M004/CL02 Managerial Finance

Coursework 1 Assignment Brief

Guidelines and Rubric

Assignment Brief
This coursework is to be prepared and submitted by group of THREE persons from within the
same seminar class.
No student will be allowed to submit work of a company that has not been selected for this
coursework. Please ensure that you submit work based on the given Company (listed on the
Singapore Stock Exchange, SGX.com). This company is listed at the end of this document.
Your seminar tutor will maintain a list of students’ names together with choice of organisation.
This Tutor held list is the definitive record; submitted work will not be assessed if it does not
agree with the list.
Requirements:

1. Based on the information from the published annual reports of the selected listed
company for the two years 2020 and 2021:

(a) Compute the following categories of ratios:

i) Profitability
ii) Liquidity
iii) Efficiency
iv) Leverage or debt and
v) Investors’ ratios.
(b) Perform a vertical and horizontal analysis of the statement of profit or loss and the
statement of financial position.
2. Based on the financial ratios, the vertical and horizontal analysis that you have
computed in part 1 and any other relevant information from the annual report, provide
a report to the board of directors of the company on the performance of the company
over the two years.
3. In addition to the financial analysis and interpretation of the company, design a
balanced scorecard to measure both the financial and non-financial performance of
the company to help the management of the company meet its strategic objectives.
Include in the scorecard: the strategic objectives, the performance measures,
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targets and the initiatives. A strategy map is required showing the links to the four
perspectives.
4. Make recommendations to improve the company’s performance considering the
competitive and changing business environment.

Your approach to this task must reflect your ability to carry out research, understanding key
principles to the financial and non-financial performance management and apply these to a
real business situation.

The outcome of this task should be in the form of a detailed and structured report addressed
to the directors of the organisation. You must also include evidence of your research materials
including full workings of your financial analysis in the appendix section of your
assignment.

Assignment Coursework 1 Anonymous YES

Number and marking
Weighting 40%

Submission Date See Blackboard Expected 14 working days from the deadline
and Time submission link return of
feedback and
23:59:00 marked work

Assessment is
made up of
multiple No
submissions

Submission Electronically via Word Count 2,500

Blackboard (Turnitin)
Procedure

Assignment Title Strategic Planning and Performance Measurement Report

Assessment
Learning
Outcomes This assignment is designed to assess all learning outcomes: LO1 to LO6
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Assignment Guidelines
Structure
1. The maximum word count for the main text excluding tables is 2,500 words. Exceeding the
word count will result in deduction of marks by up to 10 %. Only the main text excluding any
tables and diagrams counts, this also excludes the contents page, executive summary, list of
references and appendix. (Only use tables to show workings and the Balanced scorecard)
2. The assignment must have a front cover stating:
• Module number and name and seminar group number
• Title of the assignment
• Student names and IDs for each group member
• Submission date
• Word count as defined above
3. An executive summary is required (not included in the word count), but this should not
exceed 1⁄2 page. A short introduction is required (and included in the word count), as stated
in the assessment criteria.
4. A reasonable number of appendices may be used for relevant supporting information and
to demonstrate your calculations and analysis.
5. Only Word documents can be submitted through Turnitin, the University’s plagiarism
detection software, therefore you are advised to create tables in Word and not to cut and paste
Excel or other software into the document. The marker will not be able to access your
spreadsheets and see your workings.
The rubric by which your report will be assessed will be posted separately (Coursework 1
Guidelines). It is important that prior to you submitting your work, you read this and objectively
assess your response against the rubric. This will ensure that you have done enough to attain
the marks you wish to achieve.

Layout
Your work should be word processed in accordance with the following:

• Font style, Arial, font size 12

• 1.5 line spacing.
• The page orientation should be ‘portrait’
• Margins on both sides of the page should be no less than 2.5 cm
• Pages should be numbered
• Your name should not appear on the script.
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Approved Singapore Stock Exchange listed company for coursework 1:

• Fraser And Neave Limited

Annual Report: https://www.fraserandneave.com/investor-relations/annual-

reports/2021
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Horizontal Analysis

Fraser And Neave Limited

Increase / Percent
Profit Statement 2021 2020 Decrease over Change over
(For The Year Ended 30 September 2021) ($'000) ($'000) 2020 2020
$ %
Revenue 1,879,163 1,833,501 45,662 2.5%
Cost of sales (1,296,247) (1,237,627) 58,620 4.7%
Gross profit 582,916 595,874 (12,958) -2.2%
Other Income 7,673 23,309 (15,636) -67.1%
Operating expenses-Distribution (158,929) (159,649) (720) -0.5%
Operating expenses-Marketing (158,535) (180,831) (22,296) -12.3%
Operating expenses-Administration (122,079) (136,989) (14,910) -10.9%
Operating profit 151,046 141,714 9,332 6.6%
Share of results of joint venture companies (3,188) 2,131 1,057 49.6%
Share of results of associated companies 113,486 123,276 (9,790) -7.9%
Gross income from other investments 403 285 118 41.4%
Profit before interest and taxation 261,747 267,406 (5,659) -2.1%
Finance income 2,286 2,830 (544) -19.2%
Finance costs (25,138) (24,788) 350 1.4%
Profit before fair value adjustment, taxation and exceptional items 238,895 245,448 (6,553) -2.7%
Fair value adjustment of investment properties 17 (413) (396) -95.9%
Profit before taxation and exceptional items 238,912 245,035 (6,123) -2.5%
Exceptional Items (8,720) (621) 8,099 1304.2%
Profit before taxation 230,192 244,414 (14,222) -5.8%
Taxation (34,718) (36,722) (2,004) -5.5%
Profit after taxation 195,474 207,692 (12,218) -5.9%
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Horizontal Analysis
Fraser And Neave Limited
Increase / Percent
Balance Sheets 2021 2020 Decrease over Change over
(As At 30 September 2021) ($'000) ($'000) 2020 2020
$ %
Share Capital And Reserves
Share Capital 858,830 855,870 2,960 0.3%
Reserves 2,160,640 2,112,668 47,972 2.3%
Non-controlling interests 431,766 427,115 4,651 1.1%
Total Equity 3,451,236 3,395,653 55,583 1.6%

Non-Current Liabilities
Other payables 23,802 30,262 -6,460 -21.3%
Lease Liabilities 36,539 25,168 11,371 45.2%
Borrowings 499,262 795,888 -296,626 -37.3%
Provision for employee benefits 15,760 18,414 -2,654 -14.4%
Deferred tax liabilities 28,440 24,563 3,877 15.8%
Total Non-Current Liabilities 603,803 894,295 -290,492 -32.5%

Current liabilities
Trade payables 176,224 161,122 15,102 9.4%
Other payables 194,914 211,759 -16,845 -8.0%
Related parties 6,266 4,891 1,375 28.1%
Associated companies 261 398 -137 -34.4%
Lease liabilites 11,646 14,268 -2,622 -18.4%
Borrowings 427,573 42,701 384,872 901.3%
Provision for taxation 49,349 49,639 -290 -0.6%
Total Current liabilities 866,233 484,778 381,455 78.7%

Total Equity and Liabilities 4,921,272 4,774,726 146,546 3.1%

Current assets
Inventories 297,577 296,724 853 0.3%
Trade receivables 254,806 271,823 -17,017 -6.3%
Other receivables 46,177 94,899 -48,722 -51.3%
Related parties 6,121 8,664 -2,543 -29.4%
Joint venture companies 1,214 1,179 35 3.0%
Associated companies 84 7 77 1100.0%
Cash and cash equivalents 471,799 285,479 186,320 65.3%
Total Current assets 1,077,778 958,775 119,003 12.4%

Non-Current assets
Fixed assets 760,021 771,571 -11,550 -1.5%
Investment properties 16,858 17,075 -217 -1.3%
Properties held for development 17,853 18,114 -261 -1.4%
Joint venture companies 154,341 166,605 -12,264 -7.4%
Associated companies 2,712,634 2,668,602 44,032 1.7%
Intangible assets 138,636 133,695 4,941 3.7%
Brands 32,105 27,354 4,751 17.4%
Other investment 5,625 6,147 -522 -8.5%
Other receivables 726 2,272 -1,546 -68.0%
Deferred tax assets 4,695 4,516 179 4.0%
Total Non-Current assets 3,843,494 3,815,951 27,543 0.7%

Total Assets 4,921,272 4,774,726 146,546 3.1%

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Vertical Analysis

Fraser And Neave Limited

Profit Statement 2021 % over 2020 % over

(For The Year Ended 30 September 2021) ($'000) Revenue ($'000) Revenue

Revenue 1,879,163 100% 1,833,501 100.0%

Cost of sales (1,296,247) -69.0% (1,237,627) -67.5%
Gross profit 582,916 31.0% 595,874 32.5%
Other Income 7,673 0.4% 23,309 1.3%
Operating expenses-Distribution (158,929) -8.5% (159,649) -8.7%
Operating expenses-Marketing (158,535) -8.4% (180,831) -9.9%
Operating expenses-Administration (122,079) -6.5% (136,989) -7.5%
Operating profit 151,046 8.0% 141,714 7.7%
Share of results of joint venture companies (3,188) -0.2% 2,131 0.1%
Share of results of associated companies 113,486 6.0% 123,276 6.7%
Gross income from other investments 403 0.0% 285 0.0%
Profit before interest and taxation 261,747 13.9% 267,406 14.6%
Finance income 2,286 0.1% 2,830 0.2%
Finance costs (25,138) -1.3% (24,788) -1.4%
Profit before fair value adjustment, taxation and exceptional items 238,895 12.7% 245,448 13.4%
Fair value adjustment of investment properties 17 0.0% (413) 0.0%
Profit before taxation and exceptional items 238,912 12.7% 245,035 13.4%
Exceptional Items (8,720) -0.5% (621) 0.0%
Profit before taxation 230,192 12.2% 244,414 13.3%
Taxation (34,718) -1.8% (36,722) -2.0%
Profit after taxation 195,474 10.4% 207,692 11.3%
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Vertical Analysis
Fraser And Neave Limited

Balance Sheets 2021 % over Total 2020 % over Total

(As At 30 September 2021) ($'000) Asset ($'000) Asset

Share Capital And Reserves

Share Capital 858,830 17.5% 855,870 17.9%
Reserves 2,160,640 43.9% 2,112,668 44.2%
Non-controlling interests 431,766 8.8% 427,115 8.9%
Total Equity 3,451,236 70.1% 3,395,653 71.1%

Non-Current Liabilities
Other payables 23,802 0.5% 30,262 0.6%
Lease Liabilities 36,539 0.7% 25,168 0.5%
Borrowings 499,262 10.1% 795,888 16.7%
Provision for employee benefits 15,760 0.3% 18,414 0.4%
Deferred tax liabilities 28,440 0.6% 24,563 0.5%
Total Non-Current Liabilities 603,803 12.3% 894,295 18.7%

Current liabilities
Trade payables 176,224 3.6% 161,122 3.4%
Other payables 194,914 4.0% 211,759 4.4%
Related parties 6,266 0.1% 4,891 0.1%
Associated companies 261 0.0% 398 0.0%
Lease liabilites 11,646 0.2% 14,268 0.3%
Borrowings 427,573 8.7% 42,701 0.9%
Provision for taxation 49,349 1.0% 49,639 1.0%
Total Current liabilities 866,233 17.6% 484,778 10.2%

Total Equity and Liabilities 4,921,272 100.0% 4,774,726 100.0%

Current assets
Inventories 297,577 6.0% 296,724 6.2%
Trade receivables 254,806 5.2% 271,823 5.7%
Other receivables 46,177 0.9% 94,899 2.0%
Related parties 6,121 0.1% 8,664 0.2%
Joint venture companies 1,214 0.0% 1,179 0.0%
Associated companies 84 0.0% 7 0.0%
Cash and cash equivalents 471,799 9.6% 285,479 6.0%
Total Current assets 1,077,778 21.9% 958,775 20.1%

Non-Current assets
Fixed assets 760,021 15.4% 771,571 16.2%
Investment properties 16,858 0.3% 17,075 0.4%
Properties held for development 17,853 0.4% 18,114 0.4%
Joint venture companies 154,341 3.1% 166,605 3.5%
Associated companies 2,712,634 55.1% 2,668,602 55.9%
Intangible assets 138,636 2.8% 133,695 2.8%
Brands 32,105 0.7% 27,354 0.6%
Other investment 5,625 0.1% 6,147 0.1%
Other receivables 726 0.0% 2,272 0.0%
Deferred tax assets 4,695 0.1% 4,516 0.1%
Total Non-Current assets 3,843,494 78.1% 3,815,951 79.9%

Total Assets 4,921,272 100.0% 4,774,726 100.0%

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Ratio Analysis
Fraser And Neave Limited
Profitability Ratios 2021 2020 Benchmark (2021)
Gross Profit Margin
Gross Profit 582916 595874
Sale 1879163 1833501
= 31.02% 32.50% 33.24%
Operating Profit Margin
Profit before int and tax 261747 267406
Sales 1879163 1833501
= 13.93% 14.58% 16.05%
Return on Equity (for SH)
Profit after int and tax 195474 207692
Equity (Capital+Reserves) 3,451,236 3,395,653
= 5.66% 6.12% 3.89%
Return on Capital Employed
Profit before int and tax 261747 267406
Capital Employed (Equity+LT Debt) 4,055,039 4,289,948
= 6.45% 6.23% 2.29%
Liquidity Ratios
Current Ratio
Current Asset 1,077,778 958,775
Current Liabilities 866,233 484,778
= 1.24 1.98 0.86
Quick Ratio
Current Asset - Inventory 780,201 662,051
Current Liabilities 866,233 484,778
= 0.90 1.37 0.81
Efficiency Ratios
Asset Turnover Ratio (times)
Sales 1879163 1833501
Capital Employed(Equity+LT Debt) 4,055,039 4,289,948
= 0.46 0.43 0.10
Fixed Asset Turnover (times)
Sales 1879163 1833501
Non Current Asset 3,843,494 3,815,951
= 0.49 0.48 0.45
Inventory Turnover (times)
COGS 1296247 1237627
Average Inventory 297150.5 279427
= 4.36 4.43 9.17
Inventory Turnover (days)
Average Inventory 297150.5 279427
COGS 1296247 1237627
= 83.67 82.41 38.91
Accounts Receivable Days (days)
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Average Account Receivable 263314.5 274424

Credit Sales 1879163 1833501
= 51.15 54.63 48.28
Accounts Payable Days (days)
Average Account Payable 168673 171,799
Credit Purchases (COGS) 1296247 1237627
= 47.50 50.67 49.29
Leverage (Debt) Ratio
Capital Gearing Ratio
LT Liabilities 603,803 894,295
Capital Employed (Equity+Debt) 4,055,039 4,289,948
= 14.89% 20.85% 11.53%
Debt Ratio
Total Debt (CL+NCL) 1,470,036 1,379,073
Total assets (CA+NCA) 4,921,272 4,774,726
= 29.87% 28.88% 24.81%
Debt to Equity Ratio
LT Liabilities 603,803 894,295
Equity 3,451,236 3,395,653
= 17.50% 26.34% 14.61%
Interest Cover (times)
Profit before int and tax 261747 267406
Interest Expense 25138 24788
= 10.41 10.79 9.75
Investors Ratio
Earnings Per Share (EPS)
Profit After tax and Pref Dividends 195474 207692
# Ordinary Shares Issued 1451835276 1450085578
$ $ $
= 0.10 0.14 0.06
Dividend Cover (times)
Profit after tax and Pref Dividend 195474 207692
Dividend Paid on Ordinary Shares 104514 112046
= 1.87 1.85 1.23
Dividend Yield Ratio
Dividend Paid on Ordinary Shares 0.05 0.05
Market value of Ordinary Shares 1.41 1.22
= 3.5% 4.1% 3.23%
Price Earning Ratio (times)
Market Value of Ordinary Shares 1.41 1.22
Earnings per share 0.100 0.140
= 14.10 8.71 10.68