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Performance Analysis of Commonwealth Bank

   

Added on  2021-05-31

18 Pages4117 Words92 Views
1HC1010 Accounting for BusinessTrimester 1, 2018

2Executive SummaryOrganizational Performance comprises of analysis of three main core areas of thebusiness i.e. financial performance, market performance and shareholders’ value. In this reportfinancial performance of Commonwealth Bank has been analyzed through evaluating thefinancial statement of current year and comparing it with the previous year. Financialperformance of Commonwealth Bank has also been compared with its main competitor WestpacBank. Competitor analysis helps to evaluate the firm performance with other entities in sameindustry and market. Ratio analysis helps to report on the financial strength of the company overthe last three years and also tells about the trend in the financial performance of the company. Ithas been found that financial performance of Commonwealth Bank was stable during the lastthree years and its performance was much better than Westpac Bank.

3ContentsIntroduction......................................................................................................................................4Section 1: Financial Standing of the Commonwealth Bank............................................................5Part A: Analysis of the profitability of the company and comparison with the competitor........5Part B: Analysis of the cash flow statement................................................................................9Part C: Analysis of the financial position through analyzing the balance sheet........................10Section 2: Ratio Analysis (For Last Three Years).........................................................................12Section 3: Analysis of the director’s report and other statements for analyzing the performance ofmanagement...................................................................................................................................13Corporate Governance Statement & Integrity Policy................................................................13Approach of Management Towards...........................................................................................14Business Operations...................................................................................................................15Investments and Investment Activities......................................................................................15Financing and Financing Activities...........................................................................................15Industry Size..............................................................................................................................16Major Players/Competitors........................................................................................................16Market Shares of Industry Players.............................................................................................16Recommendation and Conclusion.................................................................................................17References......................................................................................................................................18

4IntroductionOrganizational performance helps to evaluate the three core areas of the company,namely financial performance, market performance and shareholders’ value. While analyzing theorganizational performance actual results are compared with the intended outputs. Professionals,management, stakeholders and strategic planners focus on the organizational performance inorder to use the derived information in making useful decisions. In financial performance, therehas been measurement of the company’s operations and defined policies in monetary terms. Thefinancial performance analysis is likely to answer the question that what was return oninvestment or assets and whether there has been increased in debt or it has been gone down. Inmarket performance there has been analysis of the share performance and other information thatimpacts the market. Shareholders analysis provides information whether company is providingenough returns to the shareholders or not and how company is maximizing the overall returns ofthe shareholders. There are various factors that impact the overall organizational performance ofthe company and while evaluating the organizational performance there is need to evaluate allthese factors. Financial performance can be evaluated through analyzing the profitability of thecompany, analyzing the cash flow statement and evaluating the financial position of thecompany. In order to evaluate the financial performance there is need to perform the ratioanalysis that compares the financial performance of the current year with the financialperformance of previous year (Brealey, Myers and Marcus, 2012). In this report, organizational performance of the Commonwealth Bank has been analyzedin order to report the current year performance to the management and other stakeholders of thecompany. In order to analyse the organizational performance, current year data has beencompared with past year data and also compared with the financial data of competitor in sameindustry. There are overall three sections that has to be present in the report. First sectionevaluates all the financial statements in order to report the performance. In second section ratioanalysis for last three years has been performed to report on financial strength of CommonwealthBank. In last section, a report has been prepared to explain how the management performs in bestinterest of the company.

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