Assignment On Barclays Plc - Financial & Accounting Position

Added on -2020-02-05

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STUDENT NAME:STUDENT ID:SUBJECT CODE:ASSIGNMENT TITLE: FINANCIAL STTAEEMT ANALYSIS
Table of contentIntroduction......................................................................................................................................3Part A...............................................................................................................................................41) Overview of Barclays PLC and the reason for selecting the company.......................................42) Identification of different key announcements............................................................................53) Identification of key financial trends of the company with internal and external environmentalfactors..............................................................................................................................................5Part B Computation of financial health of the company.................................................................81) Evaluation of liquidity ratios.....................................................................................................112) Interpretation of operational performance of the company through efficiency ratios...............133) Gearing ratios for evaluating financial performance.................................................................144) Evaluation of profitability ratios...............................................................................................155) Ratios on Investors analysis......................................................................................................176) Analysis of cash flow statement................................................................................................18Part C Findings and recommendations..........................................................................................201) Financial strengths and weaknesses..........................................................................................202) Conclusion and recommendations.............................................................................................20Reference list.................................................................................................................................22Appendices:...................................................................................................................................24Appendix 1.....................................................................................................................................24Appendix 2.....................................................................................................................................24
IntroductionFinancial position signifies financial and accounting status of a respective business organisation.Financial position and its statements of a respective company include the profits, loss,investments, capitals etc. which are evident and help business analyzers and professionals to getall the information regarding financial status and statements of the company as well. In thisrespect, it should be highly identified that researchers need to choose a significant company inorder to represent its current financial status and position in its marketplace. Moreover, theresearchers also try to represent and calculate the final ratio of the company as well ( Weil et al.2013, p.111). Other than this, it is also formulated that financial status also verifies and comparesthe company’s past and present status of financial and accounting management. Along with thecomparison, accountant managers and financial managers try to evaluate the financial status andposition so that the company can be able to improve financial position and statement of thecompany so that the respective company acquire a significant and reputed position in itsmarketplace (Hirsa and Neftci, 2013, p.101).The thesis statement of this assignment study is to analyze a company’s financial and accountingposition by representing its current ratios and also the evaluation of the ratios as well. In thisrespect, researchers need to collect and gather more information and data regarding that specificselected company so that the research analysis of this assignment may provide all the ratioanalysis, financial strengths and weaknesses, key financial trends of the company with internaland external environmental factors, evaluation of profitability ratios and so on to the readers andother business professionals and analysers, who will go through the assignment (Davies andGreen, 2013, p.100).
Part A 1) Overview of Barclays PLC and the reason for selecting the companyOverview of the company: In order to represent current ratios and evaluation of profitabilityratios and other respective financial reports, one has chosen Barclays PLC respectively. Thiscompany has been founded on 17th November, 1690 in the city of London, United Kingdom.Headquarter of this company is also situated in One Churchill Place, Canary Wharf, London,UK.Barclays is a banking and financial organisation which provides every positive and significantfunctions to its customers regarding accounting and financial systems as well (Foulds et al. 2015,p.371). All these financial systems may include savings of finance, investment, mortgage andother services related to finance. In this respect, it should be mentioned that Barclays PLC is auniversal bank and it provides its services to the customers throughout the world. In order toprovide some significant information regarding this company, one should highlight that it hasnearly 48 million customers and it performs its operations in 50 countries and territoriesreflectively. Moreover, its key people are John McFarlane, the chairman and Jes Staley, GroupChief Executive (Barclays.co.uk. 2017). This bank includes retail banking, commercial banking,investment banking and investment management as its services, for which its customers gethighlighted and high quality services regarding their finance and accounting management.However, the total revenue of this bank is $25.454 billion. Total operating income of thiscompany is $2.073 billion. Reason for selecting the company: This Company has been selected for the analysis of thisassignment study of financial position for specific and evaluative reason as well. Some reasonsare highly evaluative and important in order to present financial position and statement of thiscompany as well (Sahoo and Vidyadhar Reddy, 2014, p.99). It is to be highly signified that asthis is a banking and financial company, people can be able to get more data and informationregarding current and past ratios, profit, loss etc. In this respect, it should be designated that thiscompany was facing some troubles regarding financial and accounting analysis and ratios fromrecent past years. But, in the most recent days, the business analysers and accounting managersare trying to evaluate and improve their services so that the financial position and statements ofthis company can be able to highlight its management and marketplace as well. However, it is to
be informed that researchers have chose this company for this assignment study so that they canbe able to get financial reports and annual reports of finance and accounting definitely andsignificantly. If researchers get exact and sufficient data of financial reports and background,improving and evaluating and also creating a significant data chart and providing informationregarding financial currency and statements to the customers are very easy for them to manage(Crook, 2014, p.38). Therefore, this company has been selected by the researchers for thisassignment study as well.2) Identification of different key announcementsIn this assignment in order to analyse financial statement it should have to evaluate the differentannouncements that the company have been made that can affect company’s financialperformance and financial position. Barclays plc in order to increase their efficiency level andperformance have implemented certain steps regarding investment and mortgage securities if thecompany. The management team of the company have signed an agreement with the UK trustorganisation that can lead to increase the sales pattern and increase in growth level is possible. It has been evaluated from the annual report of Barclays that the company have simplified theirstrategies that can help to measure financial performance level and strengthening the base ofcapital and control cost effectively and efficiently. 3) Identification of key financial trends of the company with internal and external environmental factors In order to evaluate financial statement analysis identification of the key financial trends of thecompany should have to be done in an efficient manner by the management team of thecompany. Preparation of financial statement depending on the key financial trends andenvironmental factors affecting business operations of a company should have to be consideredeffectively and efficiently for smooth flow of operations is considered as an important factor inthis regard. In this assignment of financial statement analysis the selected company is BarclaysPLC, a public limited company listed in the London stock exchange is the largest bankingorganisation in the World providing services relating to investment banking, wealth managementand financial services appropriately in an efficient manner. Barclays bank of London, UKoperates in the Whole World and the operations and performance are affected by the economic
and changes conditions and it can be evaluated through PESTLE analysis effectively. In thesecontext environmental factors such as the internal and external factors impacting the financialoperations and performance of the company should have to be evaluated as follows:External factors-Political factors: Political factors can directly affect the financial performance and operations ofa company. Political factors such as welfare and social policies and regulations, taxation policiesand their changes that ca directly affect the production capacity of a company (Bekaert et al.2016, p.22). Barclays plc also affected by the taxation policies. Government stability is anotherpolitical factor that can help the operation and production functions such as Barclays to expandtheir business operations. Economic factors: Economic factors such as interest rates, business cycle of the company,money supply in the economy, level of lifestyle and consumerism rate can directly impact on theperformance level of the company (Roncalli and Weisang, 2016, p.377). Depending on thesefactors the management team of Barclays have to decide productivity planning and operations tomanufacture products and services according to the requirements of the customers such asinvestment and wealth management services. Social factors: Social factors impact on the productivity of Barclays that according to a survey ithas been found that the business transactions in 2014 has increased from 59% to 75% effectivelyand efficiently that lead the company to higher profitability and revenue (Sharma and Crossler,2014, p.305). Technological factors: Technological factors that affect the business operations of BarclaysPLC are mainly the government spending, technological changes, speed of transfer ofinfrastructural and technological affect the business operations that lead the company to increaseproductivity and returns.Legal factors: Product safety and services, different employment laws, regulations andlegislations of monopolies and accounting laws and policies should have to be followed by thedirectors and management team of the Barclays plc in order to prepare financial statements thatcan reveal true and fair view of the annual reports effectively and efficiently in this regard. Environmental factors: In order to evaluate the financial report of the Barclays PLC, bankingorganisation of London, external factors affecting the financial position and operations of thecompany should have to be interpreted appropriately to view effectiveness on business (Epstein

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