Accounting and Finance for Managers

This report explores the relevance of accounting and finance in business organizations by evaluating the performance of Green core group plc, Premier food plc & Hilton food group plc. It discusses strategic business policies, financial ratios, and sources of finance.

ACCOUNTING AND FINANCE FOR
MANAGERS

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Section A.....................................................................................................................................3
Question 1...................................................................................................................................3
SECTION B.....................................................................................................................................8
Question 2...................................................................................................................................8
CONCLUSION................................................................................................................................1
REFERENCES................................................................................................................................2

INTRODUCTION
Business organization to maintain record of their day to day transaction and represent
them in front of their internal and external users, use accounting and financial application. This
report has been formulated to define relevance of account and finance by evaluating performance
of three food industry organizations. Which incudes, Green core group plc, Premier food plc &
Hilton food group plc. This report showcase policies and strategies theses organization use for
run their business. In the second part of this report, essential elements and factors require to
collect sources of finance are define in effective and systematic way.
MAIN BODY
Section A
Question 1
a) Overview of strategic business policy used by Green core group plc, Premier food plc &
Hilton food group plc.
Green core group plc: This organization is consider as one of the most popular business
organization of UK which engaged in dealing with food products. This organization run business
as manufacturer, markets and disturber of food and convince food products.
Strategic objectives: Managers for attain their vision formulate future business objectives which
help in achieving their vision. Green Core focus on maintain top position in market area for this
purpose they use effective financial strategy. In order to achieve their business goals organization
focus on food, quality , process and their target market customers. This organization focus on
their long term goal by investing in portfolio for increase their retain business earnings.
Hilton food group plc: This organization is incorporated as multinational organization
which run its business as meat packing organization. However it spread its market share by
running business in providing food packaging services (Barari Nokashti, Banimahd and
Yaghoubnejad, 2018).
Strategic objective of this organization is generally based on spreading their market share
by innovate new business products in market. Managers in order to attract their business
customers focus in investing in long term businesses goals. Management department of Hilton
generally focus on build strong relation with small organizations and their rival business
companies. Which will beneficial to cut throat their competitors.

Premier food plc: It is British multinational organization which engaged in
manufacturing and distribute sauce, ambient food , cake and offer quick meal services This
business entity to spread its market share deal with many multinational organization which
includes Tesco, Sainsbury and other super market and food manufacturing organizations.
Strategic objective of this organization is to generally focusing on maintain position of
organization in market place by effectively maintain quality of Premier Food Plc in market.
Their main focus is to attain their strategic business objective by offering healthy and nutritions
food products. Theses food products are helpful in attract customers of organization. They set
principle and choose those strategies which useful in influence customer for purchase food
products from branch of this organization (Appuhami, 2019).
b) Evaluation of financial performance of organizations by calculating financial ratios.
Financial ratio: Managers use financial management tools for evaluate performance of
their organization with rival business corporations. Following are some ratios which help in
measuring financial performance of food organizations.
GREENCORE
GROUP PLC
3/28/2020 3/30/2019 3/31/2018
ROE using Net income
(%)
34.66 4.55 1.72
ROCE using Net
income (%)
19.12 4.8 2.58
Profit margin (%) 7.48 0.75 0.53
Gross margin (%) 33.84 30.23 31.12
EBIT margin (%) 6.73 2.04 1.84
Collection period
(days)
26 34 30
Credit period (days) 54 50 47
Current ratio (x) 0.69 2.01 0.75

GREENCORE
GROUP PLC
3/28/2020 3/30/2019 3/31/2018
Gearing (%) 156.67 90.47 119.39
Net assets turnover (x) 2.06 1.81 1.49
Non-financial ratios 3/28/2020 3/30/2019 3/31/2018
Shareholders’ funds
per employee
26 64 58
Total assets per
employee
100 173 167
HILTON FOOD
GROUP PLC
3/28/2020 3/30/2019 3/31/2018
ROE using Net income
(%)
17.23 17.95 15.2
ROCE using Net
income (%)
9.02 11.98 12.43
Profit margin (%) 2.38 2.63 2.52
Gross margin (%) 16.17 12.69 11.93
EBIT margin (%) 3.08 2.8 2.58
Collection period
(days)
37 31 30
Credit period (days) 54 50 47
Current ratio (x) 1.05 1.23 1.2
Gearing (%) 175.87 66.57 36.16

HILTON FOOD
GROUP PLC
3/28/2020 3/30/2019 3/31/2018
Net assets turnover (x) 3.58 5.56 6.53
Non-financial ratios 3/28/2020 3/30/2019 3/31/2018
Shareholders’ funds
per employee (
38 38 44
Total assets per
employee
181 121 116
PREMIER FOODS
PLC
3/28/2020 3/30/2019 3/31/2018
ROE using Net income
(%)
income (%)
2.77 -3.51 0.76
ROCE using Net
income (%)
3.37 1.16 2.94
Profit margin (%) 6.33 -5.18 2.55
Gross margin (%) 40.94 44.12 40.42
EBIT margin (%) 11.25 0.55 8.48
Collection period
(days)
27 29 24
Credit period (days) 65 65 59
Current ratio (x) 0.98 0.78 0.78
Gearing (%) 64.91 105.83 106.9
Net assets turnover (x) 0.32 0.42 0.42
Non-financial ratios 3/28/2020 3/30/2019 3/31/2018

PREMIER FOODS
PLC
3/28/2020 3/30/2019 3/31/2018
Shareholders’ funds
per employee
404 230 234
Total assets per
employee
729 533 540
ROE using Net income (%): This is part of profitability ratio. Which help in analysing
ability of generate profit by running business operations. This graphical representation showcase
that GREENCORE GROUP PLC able to generate more return on earning as compare with its
rival business organizations. Value of Hilton earning ratio has been decile which showcase that
this organization is not able to generate its revenue by using their net income (Chen,
Gallagherand Warren, 2019).

ROCE (Return on capital employee) (%): By calculating this ratio manager can
evaluate rate of generating business profit by using capital employed of organization. Rate of
generating income is increase in all the three organizations however GREEN CORE GROUP
PLC's ability to generate is higher then other business entities.
GREENCORE GROUP PLC Hilton Food group plc
0
5
10
15
20
25
30
35
40
2020 2019 2018
0
5
10
15
20
25

Net profit margin: This ratio is calculated in order to measure relationship between
profit and net sales. When the rate of net margin in high it is symbol of growth of business
organization. By evaluating net margin ratio of all the three companies it recognized that
GREENCORE GROUP PLC rate of net margin has been increases since 2018, and Hilton net
profit ratio also increase however in cases of Premier their profit ratio has been decline which
showcase that as compare to other organizations Premier foods plc not able to manage their
selling related businesses policies.
2020 2019 2018
-6
-4
-2
0
2
4
6
8
10

Gross margin: This is also a part of profitability ratio. By calculating this ratio manager
measure ability of their organization to generate business revenue before deducting any kind of
deductions. On the basis of calculating gross margin ratio this graphical representation showcase
that value of Green Core PLC '[s gross margin ratio was measure at 30.23 in 2019 and the rate of
gross margin has been increase in 2020, in case of Hilton this organizations' gross margin ratio
also increase from 12.6 to 16.1. However Premier foods plc not able to enhance their rate of
gross margin earnings (MohammadRezaei and Mohd‐Saleh, 2018).
EBIT:Ability of managerial profit before detection of tax items. Green Core PLC as compare
with other organization have efficiency to effectively manage their profits. By using this ratio
manager can evaluate the rate of earning in order to formulate future business policies.
GREENCORE GROUP PLC HILTON FOOD GROUP PLC
0
10
20
30
40
50

Collection period: This ratio is used for measuring time required to collect money from
debtors. Evaluating ratio by using chart help in determine that Premier foods plc took less time
as compare to other business organizations to collect money from their debtors. Which showcase
that even this organization not generate high rate of profit but they use effective tools to manage
their debtors.
Credit period: This ratio help in determine time required to fulfil debt liability of
creditors. This graphical representation showcase that organization Hilton have ability to pay
their creditors money within short period of time Premier foods plc tool much more time for
fulfil liability of creditors.
GREENCORE GROUP PLC HILTON FOOD GROUP PLC
0
2
4
6
8
10
12

Current ratio: Manager measure this ratio for determine relation ship between current
asset and current business liabilities. Value of current ratio of Green Core Plc and Hilton has
been decile however in 2019 value of current ratio was measure at 0.78 which increase in 2020
from 0.78 to 0.98 this showcase positive changes which means that Premier foods plc have
sufficient current asst to pay their debt liability.
GREENCORE GROUP PLC HILTON FOOD GROUP PLC
0
10
20
30
40
50
60
70

Net assets turnover ratio: Revenue generate by using business assets. This ratio help in
determine ability of organization to generate revenue by using business assets in effective
manner. This graphical representation showcase that for comparison of all the three organization
it has been evaluate or recognized that Hilton management department use effective managing
assets strategies thus the net assets turnover ratio is comparatively high then other business
organization.
GREENCORE GROUP PLC HILTON FOOD GROUP PLC
0
0.2
0.4
0.6
0.8
1
1.2
1.4

Total assets per employee: On the basis of evaluating total assets per employee ratio it
has been recognized that Green Core Group Plc is in much better condition as compare with its
competitors business organizations. This ratio showcase that organization able to motivate and
influence their employee in effective manner so they can easily evaluate and manage their assets
in effective manner (Kian, Pourheydari and Kamyab, 2018).
GREENCORE GROUP PLC HILTON FOOD GROUP PLC
0
1
2
3
4
5
6
7
GREENCORE GROUP PLC HILTON FOOD GROUP PLC
0
100
200
300
400
500
600
700
800

On the basis of calculating theses financial ratio it has been concluded that Green core
GROUP PLC is in better position then compare to its other rival business entities. Even though
performance of both organizations are good, but for the purpose of measuring financial
performance GREENCORE GROUP PLC is in much better condition. Investor can select this
organization for the purpose of investing their portfolio capital. By using retain earning and
managing their revenue in effective way this organization able to generate more profits as
compare with other entities.
c) Final decision of investment.
Investment opportunities help in formulate business plan for attain future business goals.
GREENCORE GROUP PLC is one of the top leading organization of UK and they have great
future business opportunities through which they can reached at their business vision.
Management department of this organization is focussing on started business at Mid Asian
countries and innovate new products by using their retain business earning . GREEN CORE
GROUP PLC by formulating effective business strategies able to grab businesses opportunities
by analysis condition and requirement of market.
SECTION B
Question 2
About sources of finance
Finance: This term is define as study of collection, investment and took decision
regarding managing money. Following are the funds or source Green-core Group plc for
managing their businesses
External source: Theses includes those business resource which generate income or
fulfill needs of money from outside the business. Manager have many options to raise their funds
by using external source of business. Following are define below
Equity: Business organization raise their money by issuing equity shares. They further
have option regarding with issuing preference share also. Management department Green Core
offer high rate of divide which help in retain their investor. This is consider as easy way
organization on the basis of issuing entities able to run their business in effective manner. This is
the best way to fulfil needs of finance .Equity shareholders are the real owner of the company.

The main purpose of choosing equity shares as part of external source as they are easy to use and
beneficial for organization for the purpose of maintaining their financial position in market..
Value of Shareholder's worth of Green Core Group Plc has been increase which represent
positive picture of organization (Habib and Hasan, 2019).
Loan: Green Core took long term loan from bank and other financial institutions in order
to fulfil their needs. They took loan from banks and other financial institutions.
Trade credit:It is included as part of liabilities in which agreement has been signed between
organization and creditors to take credit for particular period of time. Generally trade credit is
related with goods and stock which organization use for their business operations. Green Core
use this source in order to effectively run their business operation by fulfilling needs of finance.
Debenture: This is part of long term business liabilities. In which manager needs to pay
interest when they take decision regarding with debenture. It is consider as long term business
liabilities It is unsecured business debt instrument which manager use for the purpose of
attaining their business goals. Green Core organization use this tool as debenture are useful for
collection of money through which organization able to fulfill their long term need of finance.
Since 2018 their rate of taking debenture as source of finance has been decline due to focussing
on issuing equities.
Internal source: Theses includes those source or factors through which organization able
to generate money by using business factors. There will be many option and way which manager
apply in order to retain their business goals by using internal sources. Following internal source
which Green Core use in order to raise their funds:
Retained Earnings: Theses consider as necessary element of internal factors, which
useful in generate business profits. Value of retain business earning can be calculated on the
basis of deducting all the expenses and distribute business profit in the form of dividend after
deducting all theses items relating profit is consider as retain earning. Which organization use
for further their business activities. Green Core Limited use this earning for their further business
activities.
On the basis of that they can easily evaluate value and their financial position in business
organization. Since 2018 the rate and value of generating retain business earning has been
increases which showcase that Green Core limited able effective use their saving in order to run
business in effective manner (Hilorme and et.al. 2019).

Selling Tangible assets- This is consider as one of the easiest way to fulfil needs of
finance. Selling business assets help in fulfil needs of liquid assets through which organization
can easily manage and run their organization.
Manager formulate separate business policies in order to sell those business assets which
useful in attain business goals. On the basis of that organization can easily fulfil their debt as
well as other cash business liabilities. Green Core organization on the basis of analysis market
environment they can easily fulfil their debt liabilities. On the basis of that business organization
able to generate money. They can sale assets which is not useful for organization .
CONCLUSION
From the above analysis it has been concluded that business organizations for run their
business operation's in effective manner use account and finance. Tools of finance help in
measuring financial performance of business organization and on the basis of that manager
formulate policies regarding with attaining their strategic business objectives and took decision
for formulating further business activities . Every organization needs finance's as it act as blood
or line line of running business operations. Their will be many sources through which manager
collect and fulfil their needs of finance, it includes, external as well as internal source. Success of
organization totally depend on it and entity use these sources for operate their business activities.

REFERENCES
Books and Journals
Barari Nokashti, S., Banimahd, B. and Yaghoubnejad, A., 2018. Accounting flexibility and
managers' optimism: Test of management discretion theory. Management
Accounting.11(37). pp.1-14.]
Appuhami, R., 2019. Exploring the relationship between strategic performance measurement
systems and managers' creativity: the mediating role of psychological empowerment
and organisational learning. Accounting & Finance, 59(4), pp.2201-2233.
Chen, Z., Gallagher, D.R. and Warren, G.J., 2019. The effect of data availability in measuring
fund managers’ after‐tax alphas. Accounting & Finance. 59. pp.411-448.
MohammadRezaei, F. and Mohd‐Saleh, N., 2018. Audit report lag: the role of auditor type and
increased competition in the audit market. Accounting & Finance, 58(3), pp.885-920.
Kian, A., Pourheydari, O. and Kamyab, Y., 2018. Investigating of Managers Behavior in Using
Mental Accounting in Income Statement Reporting. Empirical Studies in Financial
Accounting. 15(58). pp.1-26.
Habib, A. and Hasan, M.M., 2019. Corporate life cycle research in accounting, finance and
corporate governance: A survey, and directions for future research. International
Review of Financial Analysis. 61. pp.188-201.
Hilorme, T., Perevozova, I., Shpak, L., Mokhnenko, A. and Korovchuk, Y., 2019. Human capital
cost accounting in the company management system. Academy of Accounting and
Financial Studies Journal. 23. pp.1-6.