(AAF044-6) - Accounting and Finance

University of Bedfordshire
Unit Title & Code: Accounting and Finance AAF044-6
Assignment Number and Title: Assignment Two – Main
Assignment Type: Business Report
Course Instructor: Fatima E-Khushboo
A Business Report on Aston Martin Lagonda Global Holdings PLC’s
Financial Statements and the concepts of corporate Finance and
Investment Appraisal in order to Evaluate Management Decision
Against Strategic Corporate Objectives
Submitted By
Name : Md. Shaon Molla
Student ID : 1866650
Course : Accounting and Finance
Program : International Business
Intake : March-2023
Submission Date: 24th May 2023
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Table of Contents
Introduction................................................................................3
Evaluation of Capital Structure Investments..........................................4-5
Tools for Investment Appraisal.........................................................6
The Advantages of Budgeting............................................................7
The Constraints of Budgeting ..........................................................7
Corporate Governance...................................................................8
Corporate Governance code of UK Government ......................................8
Corporate Governance of Aston Martin Lagonda Global Holdings..................8-10
BOD and Shareholders Accountability.........................................................10
Modern Days Thought of Aston Martin............,,...........................................11
Corporate Governance Limitation ...............................................................11
Recommendations.................................................................................12
Conclusion..........................................................................................13
References..........................................................................................14
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Introduction
In this assignment, a company from automotive sector that works in the car manufacturing
business is chosen. Aston Martin Lagonda Global Holdings PLC has been chosen as the
company for the analysis. The chosen business is headquartered in the United Kingdom.
Key features
The business is engaged in the manufacture of luxury sports cars and grand tourers. Auston
Martin was Founded in 1913 by Lionel Martin and Robert Bamford and it is acknowledged
as an iconic global brand synonymous with style, luxury, performance, and exclusivity. The
corporation now conducts business 55 countries around the world.
Corporate Objectives
Key priorities are to focus on new growth areas such as the SUV and the mid-engine markets
to drive increased revenue. Engagement in F1 highlights performances and encourages
innovation and material cost restructuring.
Key Resources
Resources are the things that the company needs to run its business operations. The
company's raw materials and brand image are its most valuable resource. The Aston Martin
also has labour, technology, money, physical structure etc. as resources.
Management Issues and challenges
Capital constraint is a big management issue in the company. Also, selecting the appropriate
project is also a challenge for the company, as the investment of capital nature is very huge
in this automotive sector. Car manufacturing is an expensive, risky, and competitive
operation and the life of the workers are at also risk as this company made handmade car
instead of production line, to provide a safe working environment to the workers of the
company and compete with the others giant competitors is a challenge for the company.
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Evaluation of Capital Structure Investments
Capital includes both the money invested by the company's shareholders and the money
borrowed from the public or financial institutions to run the company. This section of the
report will go through the company's capital structure and investment analysis.
Capital Structure:
The company's capital structure consists of long-term obligations and equity attributable to
its shareholders. The company uses no preferential shares or debentures to finance its
operations.
Equity - A company's equity is the amount of money donated by its investors or
shareholders in return for equity shares in the organization. The total number of equity
shares that the company is authorized to issue is known as authorized capital, and the
number of equity shares that the firm has issued to shareholders and investors is known as
paid-up equity shares. Dividend payments to shareholders are provided if the firm has
profits and is willing to distribute those profits with the shareholders; they are not mandated
by law. Otherwise, the earnings will become part of the firm's retained profits and will be
used for development and expansion if the company does not pay a dividend to its
shareholders.
Debt – The debt is the loan which is raised by the company to operate its business
activities. The loan might be raised by the corporation through debentures offered to the
public or financial institutions, or through loans raised through banks or financial
organizations. The interest is a fixed percentage imposed on the amount of debt paid to the
company's creditors. The amount of interest is seen as a less expensive source of capital
since the interest rate is not particularly high, but the risk associated with this source is
substantial because the company must pay the amount of interest regardless of the
circumstances. It should be mentioned that the company's interest payments are tax
deductible expenses, which reduces the cost of the source even further for the business.
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