The Impact of Financing Options on Business Performance
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The provided content includes nine academic articles on various topics related to finance, entrepreneurship, and management. The articles explore themes such as dividend policy, managerial ownership, debt financing, environmental management systems, load following with Small Modular Reactors (SMRs), crowdfunding, financing and investment efficiency, equity partnerships, secular stagnation, takeover contests, and owner project capabilities for infrastructure development. Additionally, the content includes two online sources: a cash budget definition and gearing ratio calculation. The articles provide a non-parametric perspective on financial issues and offer insights into real-world scenarios.
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Managing Financial
Resources and Decisions
1
Resources and Decisions
1
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TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Identify the sources of finances for........................................................................................3
1.2 Implication for using..............................................................................................................4
1.3 Appropriate financial source for Clariton Antique Ltd..........................................................5
Task 2...............................................................................................................................................6
2.1 Costs attached with sources of finance..................................................................................6
2.2 Explanation of financial planning and its importance...........................................................7
2.3 Information required for making effective decision..............................................................8
2.4 Impact of financial sources on accounting statements...........................................................8
Task 3...............................................................................................................................................9
3.1 Cash budget............................................................................................................................9
3.2 Calculation of Unit cost.......................................................................................................10
3.3 Investment appraisal techniques..........................................................................................11
Task 4.............................................................................................................................................13
4.1 key components of financial statements..............................................................................13
4.2 Formats of financial statements...........................................................................................14
4.3 Interpretation of financial ratios...........................................................................................17
Conclusion.....................................................................................................................................19
References......................................................................................................................................21
2
INTRODUCTION ..........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Identify the sources of finances for........................................................................................3
1.2 Implication for using..............................................................................................................4
1.3 Appropriate financial source for Clariton Antique Ltd..........................................................5
Task 2...............................................................................................................................................6
2.1 Costs attached with sources of finance..................................................................................6
2.2 Explanation of financial planning and its importance...........................................................7
2.3 Information required for making effective decision..............................................................8
2.4 Impact of financial sources on accounting statements...........................................................8
Task 3...............................................................................................................................................9
3.1 Cash budget............................................................................................................................9
3.2 Calculation of Unit cost.......................................................................................................10
3.3 Investment appraisal techniques..........................................................................................11
Task 4.............................................................................................................................................13
4.1 key components of financial statements..............................................................................13
4.2 Formats of financial statements...........................................................................................14
4.3 Interpretation of financial ratios...........................................................................................17
Conclusion.....................................................................................................................................19
References......................................................................................................................................21
2
INTRODUCTION
In order to successfully manage the financial resources within the organization it is
essential for management to proper allocate the resources so that they may engage in proper
operational activities. With the proper alignment and allocation of the financial resources
corporation can easily accomplishes their goals and objectives. Along with this, it is also
assessed that engaging in taking financial decision regarding adequate supply of funds it results
in overcoming or minimizing the financial risk (Fischer and Marsh, 2015). For the present report
focuses on considering the case scenario of Clariton Antique Ltd. That is started as the an
unincorporated business. The company has effective brand image in the field of selling antique
items.
Along with this, report will identify the different sources of finance that is available for
both unincorporated and incorporated business so that they can easily source the adequate fund
for operating the business activities (Zerban, Omar and Al Sibani, 2015). In addition to this, it
would also calculate or assess that viability of the undertaking project with the help of different
investment appraisals techniques such as IRR, NPV etc.
TASK 1
1.1 Identify the sources of finances for
a) Unincorporated business
Unincorporated are such entities those do not have their separate legal identification.
Sole traders or partnership firms come under such type of business. In such firms, owner has to
take responsibility of risk and liability of the organization (Dimmock, Gerken and Grahm, 2015).
Financial sources available to unincorporated business are as following: Bank loan: It is one of the most suitable source of finance available to the firms. As
Clariton Antique Ltd is working as partnership firm, all four partners are responsible for
the risk of the organization. With the help of this source, cited firm will be able to
increase cash flow in the workplace. Apart from this it can be repaid by borrower easily
because schedule of repayment is manageable. Long term funds requirement can be
fulfilled with the help of bank loan (Abazieva and et.al, 2015).
3
In order to successfully manage the financial resources within the organization it is
essential for management to proper allocate the resources so that they may engage in proper
operational activities. With the proper alignment and allocation of the financial resources
corporation can easily accomplishes their goals and objectives. Along with this, it is also
assessed that engaging in taking financial decision regarding adequate supply of funds it results
in overcoming or minimizing the financial risk (Fischer and Marsh, 2015). For the present report
focuses on considering the case scenario of Clariton Antique Ltd. That is started as the an
unincorporated business. The company has effective brand image in the field of selling antique
items.
Along with this, report will identify the different sources of finance that is available for
both unincorporated and incorporated business so that they can easily source the adequate fund
for operating the business activities (Zerban, Omar and Al Sibani, 2015). In addition to this, it
would also calculate or assess that viability of the undertaking project with the help of different
investment appraisals techniques such as IRR, NPV etc.
TASK 1
1.1 Identify the sources of finances for
a) Unincorporated business
Unincorporated are such entities those do not have their separate legal identification.
Sole traders or partnership firms come under such type of business. In such firms, owner has to
take responsibility of risk and liability of the organization (Dimmock, Gerken and Grahm, 2015).
Financial sources available to unincorporated business are as following: Bank loan: It is one of the most suitable source of finance available to the firms. As
Clariton Antique Ltd is working as partnership firm, all four partners are responsible for
the risk of the organization. With the help of this source, cited firm will be able to
increase cash flow in the workplace. Apart from this it can be repaid by borrower easily
because schedule of repayment is manageable. Long term funds requirement can be
fulfilled with the help of bank loan (Abazieva and et.al, 2015).
3
Third party investors: Venture capitalists is the another source of finance, in this any
third party or investor can invest their money in the firm for getting high revenue. This
helps in the enhancement of capital of the entity. As high risk is attached with the start up
firms like Clariton Antique Ltd so investors look upon the worthiness of the company
then they invest amount in it (Abraham, 2015). But cited firm will have share ownership
with them that can influence decision making process of the corporation.
b) Incorporated business
These are such firms those which have legal structure, firms have to follow legal
guidelines. Owner or partners are no responsible for the debt and risk of the organization.
Financial sources for incorporated business are discussed below: Retained earning: It is the cheapest form of source of finance, in which organizations
retain own profit for further development of the company (Yildiz, 2014). As per the
statistical facts in UK 80% retained profit reinvested by owners for the growth of
business. In this entrepreneur needs not to pay interest to any lenders thus, liability
remains in control.
Share capital: It is the shareholder's money which they invest in the organization for
getting higher profit. Shareholders get shares of the company and they enjoy preference
rights. It is long term financial source for the company and can help in increasing capital
side of the firm. If entity earns profit then they will get dividend on it (Nan and Wen,
2014).
1.2 Implication for using
Both the sources of finance that is internal and external sources support the business
organization in raising adequate funds that assists them to operate their business activities in the
market (Aktas and et.al, 2015). There are certain implications of using both the sources that are
enumerated as follows-
a) Internal sources of finance
Implication of using sale of assets: The key internal source of finance is selling of
unwanted assets with the help of this company can easily raise fund for the business. The
implication for using sale of assets for raising finance results in adding expenses for the
organization (Opitz and Hofmann, 2014). As, for selling the assets such as furniture,
4
third party or investor can invest their money in the firm for getting high revenue. This
helps in the enhancement of capital of the entity. As high risk is attached with the start up
firms like Clariton Antique Ltd so investors look upon the worthiness of the company
then they invest amount in it (Abraham, 2015). But cited firm will have share ownership
with them that can influence decision making process of the corporation.
b) Incorporated business
These are such firms those which have legal structure, firms have to follow legal
guidelines. Owner or partners are no responsible for the debt and risk of the organization.
Financial sources for incorporated business are discussed below: Retained earning: It is the cheapest form of source of finance, in which organizations
retain own profit for further development of the company (Yildiz, 2014). As per the
statistical facts in UK 80% retained profit reinvested by owners for the growth of
business. In this entrepreneur needs not to pay interest to any lenders thus, liability
remains in control.
Share capital: It is the shareholder's money which they invest in the organization for
getting higher profit. Shareholders get shares of the company and they enjoy preference
rights. It is long term financial source for the company and can help in increasing capital
side of the firm. If entity earns profit then they will get dividend on it (Nan and Wen,
2014).
1.2 Implication for using
Both the sources of finance that is internal and external sources support the business
organization in raising adequate funds that assists them to operate their business activities in the
market (Aktas and et.al, 2015). There are certain implications of using both the sources that are
enumerated as follows-
a) Internal sources of finance
Implication of using sale of assets: The key internal source of finance is selling of
unwanted assets with the help of this company can easily raise fund for the business. The
implication for using sale of assets for raising finance results in adding expenses for the
organization (Opitz and Hofmann, 2014). As, for selling the assets such as furniture,
4
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building etc company requires monetary fund for opting advertisement. On the contrary
to this, while selling the building the company also face legal implication as it may not
results in diluting the ownership (Vladimirov, 2015).
Implication of using retained earnings: Another internal source of finance include
gaining monetary fund through retained earnings these are also termed as the retained
profit of the business that is used within the business for engaging in the business
activities (Meyskens and Bird, 2015). There are no financial implication associated with
this form of internal source of finance.
b) External sources of finance
Implication of taking bank loans: The key external source of finance that is used by
corporation for raising the fund include taking loans from bank. Thus, taking bank loan
results in attaining economical implication for the business as in order to meet the bank
loan the company need to repay the interest on the loan taken from the bank. Along with
this, another implication of taking bank loan is that it also act as the expense for the firm
as they have to pay certain amount to bank (Atanassov, 2015). In the situation if company
is unable to repay the loan then bank is accountable to cease their operations and
activities.
1.3 Appropriate financial source for Clariton Antique Ltd
Clariton Antique Ltd is aiming to open its second branch and cited firm wants to raise
funds so that it can expand its business globally. For achieving this objective Clariton Antique
Ltd needs huge amount, so bank loan will be the most suitable source of finance for the
organization. Security charges and interest rate of financial institutes are affordable (Florackis,
Kanas and Kostakis, 2015). Apart from this cited firm can repay the amount in easy installments.
So that risk is limited thus it may give good results to the organization. Though it will increase
liability but Clariton Antique Ltd can manage it and will be able to earn good profit by this way.
Retained earning is another option which can give optimistic results to the cited firm. As
Clariton Antique Ltd will use its own profit amount so liability will be in control, it can help in
increasing profit of the company. Business can use its own internal amount for further
development, by this way owner will not have to share its ownership with third person.
Individual will be able to take business decision by own (Acciaro, 2014). It cited firm opt this
5
to this, while selling the building the company also face legal implication as it may not
results in diluting the ownership (Vladimirov, 2015).
Implication of using retained earnings: Another internal source of finance include
gaining monetary fund through retained earnings these are also termed as the retained
profit of the business that is used within the business for engaging in the business
activities (Meyskens and Bird, 2015). There are no financial implication associated with
this form of internal source of finance.
b) External sources of finance
Implication of taking bank loans: The key external source of finance that is used by
corporation for raising the fund include taking loans from bank. Thus, taking bank loan
results in attaining economical implication for the business as in order to meet the bank
loan the company need to repay the interest on the loan taken from the bank. Along with
this, another implication of taking bank loan is that it also act as the expense for the firm
as they have to pay certain amount to bank (Atanassov, 2015). In the situation if company
is unable to repay the loan then bank is accountable to cease their operations and
activities.
1.3 Appropriate financial source for Clariton Antique Ltd
Clariton Antique Ltd is aiming to open its second branch and cited firm wants to raise
funds so that it can expand its business globally. For achieving this objective Clariton Antique
Ltd needs huge amount, so bank loan will be the most suitable source of finance for the
organization. Security charges and interest rate of financial institutes are affordable (Florackis,
Kanas and Kostakis, 2015). Apart from this cited firm can repay the amount in easy installments.
So that risk is limited thus it may give good results to the organization. Though it will increase
liability but Clariton Antique Ltd can manage it and will be able to earn good profit by this way.
Retained earning is another option which can give optimistic results to the cited firm. As
Clariton Antique Ltd will use its own profit amount so liability will be in control, it can help in
increasing profit of the company. Business can use its own internal amount for further
development, by this way owner will not have to share its ownership with third person.
Individual will be able to take business decision by own (Acciaro, 2014). It cited firm opt this
5
source then risk will be limited and liability will be in control. It will help in accomplishing the
objective of cited firm of raising funds 0.5 million.
TASK 2
2.1 Costs attached with sources of finance
Whenever companies opt any source of finance then it has to bear costs which are
associated with them. These costs can increase burden of the entity and can harm its position. For
instance bank loan is most preferred source but in this firm has to pay interest and documentation
fees to financial institutions. That increases financial burden of the company (Petrakis, Kostis
and Kafka, 2016). If Clariton Antique Ltd borrow money from banks then interest cots would be
the main cost for the firm. If cited firm opt third party investment or venture capitalists source
then owner of the entity will have to pay dividend to the investor. It increases profit and raise
funds and on raised capital cite cited firm will have to pay tax. Equity share is another source of
fiance but in this ownership cost is attached with it. Two main sources are venture capitalist and
financial broker (Winch and Leiringer, 2016). Broker is the person who helps in lending amount
to owner from banks.
a) Dividend cost:
It is attached with the venture capitalist, in which Clariton Antique Ltd will have to share
its profit in the form of dividend with investors. It reduces profit of the company. “We Finance
limited” is the capitalist which has approached to Clariton Antique Ltd. Company is demanding
20% stake in the business against its investment. This source of finance can increase burden of
the firm because 20% is very high and entrepreneur will have to share ownership with the
investor (Alagathurai, 2014). Dilution of ownership is another cost associated with venture
capitalist.
b) Interest cost:
It is attached with the bank loan, Clariton Antique Ltd will have to pay interest if it takes
money from financial institutions. Bank will charge 2% annual interest and 1% will be charged
by broker as commission so overall cost of capital would be 3%.
c) Tax costs:
Cited firm will have to tax on its surplus amount. For instance; if current tax rate is 20%
then it would reduce net profit of the company (El Chami and et.al, 2015).
6
objective of cited firm of raising funds 0.5 million.
TASK 2
2.1 Costs attached with sources of finance
Whenever companies opt any source of finance then it has to bear costs which are
associated with them. These costs can increase burden of the entity and can harm its position. For
instance bank loan is most preferred source but in this firm has to pay interest and documentation
fees to financial institutions. That increases financial burden of the company (Petrakis, Kostis
and Kafka, 2016). If Clariton Antique Ltd borrow money from banks then interest cots would be
the main cost for the firm. If cited firm opt third party investment or venture capitalists source
then owner of the entity will have to pay dividend to the investor. It increases profit and raise
funds and on raised capital cite cited firm will have to pay tax. Equity share is another source of
fiance but in this ownership cost is attached with it. Two main sources are venture capitalist and
financial broker (Winch and Leiringer, 2016). Broker is the person who helps in lending amount
to owner from banks.
a) Dividend cost:
It is attached with the venture capitalist, in which Clariton Antique Ltd will have to share
its profit in the form of dividend with investors. It reduces profit of the company. “We Finance
limited” is the capitalist which has approached to Clariton Antique Ltd. Company is demanding
20% stake in the business against its investment. This source of finance can increase burden of
the firm because 20% is very high and entrepreneur will have to share ownership with the
investor (Alagathurai, 2014). Dilution of ownership is another cost associated with venture
capitalist.
b) Interest cost:
It is attached with the bank loan, Clariton Antique Ltd will have to pay interest if it takes
money from financial institutions. Bank will charge 2% annual interest and 1% will be charged
by broker as commission so overall cost of capital would be 3%.
c) Tax costs:
Cited firm will have to tax on its surplus amount. For instance; if current tax rate is 20%
then it would reduce net profit of the company (El Chami and et.al, 2015).
6
2.2 Explanation of financial planning and its importance
Economic forecasting is the process which helps to determine future cash requirement
and income. Financial plan discuss about resources, activities, equipment which can help in
meeting with the common goal of company. It is very important from the business prospective:
It helps to determine the future capital requirement (Guerrero-Baena and et.al, 2015).
It is essential in framing the financial policies related to cash control, borrowing, lending,
investments.
Maximum utilization of resources can be done with the help of economic forecasting.
Uncertain events and their negative impact can get minimized by proper planning.
Effective financial planning helps to make impressive strategies which can reduce the
cost of the organization.
Importance of financial planning in the Clariton Antique Ltd, these are as below
discussed:
a) Budgeting:
It is most essential part of business, economic forecasting assist in reducing the issues
such as surplus or shortage. Management of cash flow and outflow can be done with the help of
financial planning. Proper financial plan can help in allocation of resource thus, wastage and
over used will not take place in the cited firm (Brewster, Mayrhofer and Cooke, 2015).
b) Implication of failure to finance adequately:
Failure is the most crucial situation of business, which can harm profit and brand image
to great extent. Some time selection of in appropriate source of finance can increase liability.
Then difference between profit earning and liability will be higher and cited firm will not be able
to meet its obligations on time. By this way Clariton Antique Ltd can not be able to recover such
huge loss. With the help of financial planning, entity will be able o forecast the future situations
so it would be able to select most appropriate source which can help in minimizing the chances
of failure.
c) Over trading:
To run business smoothly balance between demand and supply is essential. Over trading
can reduce profit and can increase financial burden of the company. By preparing effective
7
Economic forecasting is the process which helps to determine future cash requirement
and income. Financial plan discuss about resources, activities, equipment which can help in
meeting with the common goal of company. It is very important from the business prospective:
It helps to determine the future capital requirement (Guerrero-Baena and et.al, 2015).
It is essential in framing the financial policies related to cash control, borrowing, lending,
investments.
Maximum utilization of resources can be done with the help of economic forecasting.
Uncertain events and their negative impact can get minimized by proper planning.
Effective financial planning helps to make impressive strategies which can reduce the
cost of the organization.
Importance of financial planning in the Clariton Antique Ltd, these are as below
discussed:
a) Budgeting:
It is most essential part of business, economic forecasting assist in reducing the issues
such as surplus or shortage. Management of cash flow and outflow can be done with the help of
financial planning. Proper financial plan can help in allocation of resource thus, wastage and
over used will not take place in the cited firm (Brewster, Mayrhofer and Cooke, 2015).
b) Implication of failure to finance adequately:
Failure is the most crucial situation of business, which can harm profit and brand image
to great extent. Some time selection of in appropriate source of finance can increase liability.
Then difference between profit earning and liability will be higher and cited firm will not be able
to meet its obligations on time. By this way Clariton Antique Ltd can not be able to recover such
huge loss. With the help of financial planning, entity will be able o forecast the future situations
so it would be able to select most appropriate source which can help in minimizing the chances
of failure.
c) Over trading:
To run business smoothly balance between demand and supply is essential. Over trading
can reduce profit and can increase financial burden of the company. By preparing effective
7
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financial plan Clariton Antique Ltd will be able to manage its trade well thus, over trading issue
will not take place ion the organization (Locatelli and et.al, 2015).
2.3 Information required for making effective decision
Before taking investment decision investor looks upon variety of detail of company.
Bank also look upon the economic worthiness of organization before lending amount to the firm.
These information helps them in making proper decisions that can help in generating high
income and gaining good returns. Various persons will need some information, these are as
following:
a) The partner:
Four partners have found the Clariton Antique Ltd, they all invested their money in it so
that business can run smoothly. Before investing their own money they will need information
like liquidity position, assets of the company, solvency ratio, previous profit history etc (Cash
Budget, 2017). By this way partners of cited firm will be able to take their own decision whether
to invest in the firm or not.
b) Venture capitalist (We Finance limited):
We Finance limited has approached to the Clariton Antique Ltd for investment in the
company. Before investing amount in the start up business investor will need information like
economic position of the company, brand image, solvency ratio, assets, liabilities, dividend
policy. Earning capacity etc. These all details will help the capitalist in taking their decisions of
investment in the organization.
c) Finance broker:
Broker is the mediator between borrower and lender. They arrange loan for the
organization, they need information regarding previous liabilities of Clariton Antique Ltd, repay
capacity, interest bearing capacity, solvency ratio, inventory turn over ratio etc. These all details
will support banks in taking decision of lending. (Gearing Ratio, 2017)
2.4 Impact of financial sources on accounting statements
Selection of sources of fiance is very important part of business functions, it can enhance
profit or can increase burden of the company. If Clariton Antique Ltd chooses to go with venture
capitalist then it will raise capital of the cited firm. That will impact on the balance sheet of the
organization. But entity will have to pay dividend to investors and also it will have to include the
8
will not take place ion the organization (Locatelli and et.al, 2015).
2.3 Information required for making effective decision
Before taking investment decision investor looks upon variety of detail of company.
Bank also look upon the economic worthiness of organization before lending amount to the firm.
These information helps them in making proper decisions that can help in generating high
income and gaining good returns. Various persons will need some information, these are as
following:
a) The partner:
Four partners have found the Clariton Antique Ltd, they all invested their money in it so
that business can run smoothly. Before investing their own money they will need information
like liquidity position, assets of the company, solvency ratio, previous profit history etc (Cash
Budget, 2017). By this way partners of cited firm will be able to take their own decision whether
to invest in the firm or not.
b) Venture capitalist (We Finance limited):
We Finance limited has approached to the Clariton Antique Ltd for investment in the
company. Before investing amount in the start up business investor will need information like
economic position of the company, brand image, solvency ratio, assets, liabilities, dividend
policy. Earning capacity etc. These all details will help the capitalist in taking their decisions of
investment in the organization.
c) Finance broker:
Broker is the mediator between borrower and lender. They arrange loan for the
organization, they need information regarding previous liabilities of Clariton Antique Ltd, repay
capacity, interest bearing capacity, solvency ratio, inventory turn over ratio etc. These all details
will support banks in taking decision of lending. (Gearing Ratio, 2017)
2.4 Impact of financial sources on accounting statements
Selection of sources of fiance is very important part of business functions, it can enhance
profit or can increase burden of the company. If Clariton Antique Ltd chooses to go with venture
capitalist then it will raise capital of the cited firm. That will impact on the balance sheet of the
organization. But entity will have to pay dividend to investors and also it will have to include the
8
person in all important board meetings. They will impact on the income statement of the
company, as dividend paid will reflect in the expenses side and will reduce overall profit of the
company. As it will increase cash inflow thus, impact on the cash flow statement of the Clariton
Antique Ltd (Locatelli and et.al, 2015).
Finance broker is another source of finance that impact on the financial statement of the
company. As Clariton Antique Ltd will have to give 1% brokerage to the person that will count
as expenses of the corporation thus, impact on the profit and loss account of the cited firm. Bank
loan will increase assets side and will enhance cash inflow of the organization. On other hand
organization will have o pay interest for longer period to banks. That will enhance liability of the
company thus, will impact on the balance sheet of the organization. Interest (2% annual),
documentation fees, brokerage (1%) etc. are expenditure of the company so it will reflect into the
profit and loss account in the expenses side (Guerrero-Baena and et.al, 2015).
TASK 3
3.1 Cash budget
Cash budget is the plan that assists firms in evaluating the cash flow during particular
financial year. It is the projection of cash inflow and outflow through which an enterprise can
measure its earning over expenses. For instance if there would be shortage of funds in near future
then organization can make changes in its credit policy. For running business activities
smoothly, it is essential to have cash budget so that unnecessary expenditures can get reduced to
great extent. It adds all income such as from cash sales, credit sales etc. and deduct it from
expenditures for getting the net cash balance (El Chami and et.al, 2015).
Particulars January February March April May June
£ £ £ £ £ £
Cash inflow
Sales on
cash
15000 22500 300000 15000 15000 3750
Credit
collection
142500 262500 405000 547500 330000 285000
Total cash
revenue
157500 285000 435000 562500 345000 288750
9
company, as dividend paid will reflect in the expenses side and will reduce overall profit of the
company. As it will increase cash inflow thus, impact on the cash flow statement of the Clariton
Antique Ltd (Locatelli and et.al, 2015).
Finance broker is another source of finance that impact on the financial statement of the
company. As Clariton Antique Ltd will have to give 1% brokerage to the person that will count
as expenses of the corporation thus, impact on the profit and loss account of the cited firm. Bank
loan will increase assets side and will enhance cash inflow of the organization. On other hand
organization will have o pay interest for longer period to banks. That will enhance liability of the
company thus, will impact on the balance sheet of the organization. Interest (2% annual),
documentation fees, brokerage (1%) etc. are expenditure of the company so it will reflect into the
profit and loss account in the expenses side (Guerrero-Baena and et.al, 2015).
TASK 3
3.1 Cash budget
Cash budget is the plan that assists firms in evaluating the cash flow during particular
financial year. It is the projection of cash inflow and outflow through which an enterprise can
measure its earning over expenses. For instance if there would be shortage of funds in near future
then organization can make changes in its credit policy. For running business activities
smoothly, it is essential to have cash budget so that unnecessary expenditures can get reduced to
great extent. It adds all income such as from cash sales, credit sales etc. and deduct it from
expenditures for getting the net cash balance (El Chami and et.al, 2015).
Particulars January February March April May June
£ £ £ £ £ £
Cash inflow
Sales on
cash
15000 22500 300000 15000 15000 3750
Credit
collection
142500 262500 405000 547500 330000 285000
Total cash
revenue
157500 285000 435000 562500 345000 288750
9
Cash
outflow
Total
payments
807250 137250 119750 437250 227250 219750
Total cash
outflow
807250 137250 119750 437250 227250 219750
Net cash
(Total cash
income-
total
payments)
-649750 147750 315250 125250 117750 69000
Opening
cash balance
110000 -539750 -392000 -76750 48500 166250
Closing
cash balance
-539750 -392000 -76750 48500 166250 235250
From the above cash budget it is analyzed that in the month of January total expenditures
of Clariton Antique Ltd was very high as compare to its ash inflow. Which means cited firm was
not able to meet its obligations and its cash management strategies was not appropriate. But after
that it as managed its expenses and in February to June cited firm has make effective control
over its spending that has given benefit of positive cash balance (Cash Budget, 2017). For
improving liquidity in the entity, Clariton Antique Ltd will have to focus on enhancing its sales
figures, which is possible if cited firm gives cash discounts to its customers. Trade discounts will
attract more consumers and they will buy the antiques that will increase cash inflow in the
company.
3.2 Calculation of Unit cost
Clariton Antique Ltd is not engaged in the production of goods, but it has to bear fixed
and variable expenditures. Fixed expenses of the cited firm are building rent, salaries etc.
Whereas variable costs of the Clariton Antique Ltd are transportation cost, utility bills,
purchasing of final goods etc. Both these cost increases burden of the company and that is why
profit of the firm can get reduced (Acciaro, 2014). Formula of unit cost calculation is as below
described:
Total fixed cost + variable costs / total number of unit produces by the firm
10
outflow
Total
payments
807250 137250 119750 437250 227250 219750
Total cash
outflow
807250 137250 119750 437250 227250 219750
Net cash
(Total cash
income-
total
payments)
-649750 147750 315250 125250 117750 69000
Opening
cash balance
110000 -539750 -392000 -76750 48500 166250
Closing
cash balance
-539750 -392000 -76750 48500 166250 235250
From the above cash budget it is analyzed that in the month of January total expenditures
of Clariton Antique Ltd was very high as compare to its ash inflow. Which means cited firm was
not able to meet its obligations and its cash management strategies was not appropriate. But after
that it as managed its expenses and in February to June cited firm has make effective control
over its spending that has given benefit of positive cash balance (Cash Budget, 2017). For
improving liquidity in the entity, Clariton Antique Ltd will have to focus on enhancing its sales
figures, which is possible if cited firm gives cash discounts to its customers. Trade discounts will
attract more consumers and they will buy the antiques that will increase cash inflow in the
company.
3.2 Calculation of Unit cost
Clariton Antique Ltd is not engaged in the production of goods, but it has to bear fixed
and variable expenditures. Fixed expenses of the cited firm are building rent, salaries etc.
Whereas variable costs of the Clariton Antique Ltd are transportation cost, utility bills,
purchasing of final goods etc. Both these cost increases burden of the company and that is why
profit of the firm can get reduced (Acciaro, 2014). Formula of unit cost calculation is as below
described:
Total fixed cost + variable costs / total number of unit produces by the firm
10
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For instance: Fixed cost of Clariton Antique Ltd is £30000, variable cost is £40000 and cited
firm wants to produce 10000 units then calculation of unit cost will be as :
= £30000+ £40000 / 10000
= £70000 /10000
= £7 unit
By identifying the per unit cost, cited firm can take its pricing decisions easily. If Clariton
wants to earn profit of 25% till the end of 2017 then calculation of pricing will be as following:
= Unit cost + Uni cost * desired profit percentage
= £7 + £7*25%
= £8.75
So it can be said that if Clariton wants to earn 25% profit then it will have to keep
per unit selling price £8.75.
Sensitivity analyses: There are various components those affect the over all pricing
decisions such as sales, costs, net income etc. This analyses shows changes in CVP if variables
get changed. For instance if variable cost of the company get increased to 50000 then unit cost
would be: 30000+50000/10000= 8 then, pricing for getting 25% profit would be; 8+8*25% =
£10. This difference is reflected by sensitivity analyses.
3.3 Investment appraisal techniques
To invest amount in the high return and less risky project is very important. That can help
in generating good income in the organization. Investment appraisals techniques assist in
identifying the viable projects so that company can earn good earning. ARR, NPV, PBP etc. are
many methods that can help in taking appropriate decision of investment.
Pay back period (PBP):
It is the method which defines the time duration in which entity can get return its money.
It focuses on risk and timing factors.
PBP = Initial investment / annual cash flow Advantage: It is very simple technique and favor to quick return project so that liquidity
of the company can get maximized.
Disadvantage: it ignores the profit side of the projects and do not give any definitive
investment signal.
11
firm wants to produce 10000 units then calculation of unit cost will be as :
= £30000+ £40000 / 10000
= £70000 /10000
= £7 unit
By identifying the per unit cost, cited firm can take its pricing decisions easily. If Clariton
wants to earn profit of 25% till the end of 2017 then calculation of pricing will be as following:
= Unit cost + Uni cost * desired profit percentage
= £7 + £7*25%
= £8.75
So it can be said that if Clariton wants to earn 25% profit then it will have to keep
per unit selling price £8.75.
Sensitivity analyses: There are various components those affect the over all pricing
decisions such as sales, costs, net income etc. This analyses shows changes in CVP if variables
get changed. For instance if variable cost of the company get increased to 50000 then unit cost
would be: 30000+50000/10000= 8 then, pricing for getting 25% profit would be; 8+8*25% =
£10. This difference is reflected by sensitivity analyses.
3.3 Investment appraisal techniques
To invest amount in the high return and less risky project is very important. That can help
in generating good income in the organization. Investment appraisals techniques assist in
identifying the viable projects so that company can earn good earning. ARR, NPV, PBP etc. are
many methods that can help in taking appropriate decision of investment.
Pay back period (PBP):
It is the method which defines the time duration in which entity can get return its money.
It focuses on risk and timing factors.
PBP = Initial investment / annual cash flow Advantage: It is very simple technique and favor to quick return project so that liquidity
of the company can get maximized.
Disadvantage: it ignores the profit side of the projects and do not give any definitive
investment signal.
11
Investment 1 £m Investment 2 £m
Initial investment -8.6 -4.4
1 1.6 -7 0.8 -3.6
2 2.8 -4.2 1.4 -2.2
3 3.4 -0.8 2 -0.2
4 3.6 2.8 2.4 2.2
5 4 6.8 2.3 4.5
6 4.2 11 2.6 7.1
Pay back period 3.22 3.08
Clariton Antiques Ltd has decided to meet the criteria of 3.5 year PBP. In both projects
PBP value is less than its expectation. Thus, both investments are less risky and in both cited
firm can recover its invested amount soon. So it can be said that both investments are viable for
the Clariton Antiques Ltd, but if it has to select one then it should go with project 2 because in
this cited firm will be able to pay back its money within 3.08 years.
Average rate of return (ARR):
It is another technique which concentrates on returns over investment. Formula:
ARR = Total net profit / No. of year / Initial cost *100 Strength: As it gives result is percentage so company can compare it easily. Profitability
is the major concern of this method.
Weakness: Terminal value and time factor completely ignored by the ARR (Winch and
Leiringer, 2016).
Investment 1 Investment 2
£m £m
Initial investment 8.6 4.4
1 1.6 0.8
2 2.8 1.4
12
Initial investment -8.6 -4.4
1 1.6 -7 0.8 -3.6
2 2.8 -4.2 1.4 -2.2
3 3.4 -0.8 2 -0.2
4 3.6 2.8 2.4 2.2
5 4 6.8 2.3 4.5
6 4.2 11 2.6 7.1
Pay back period 3.22 3.08
Clariton Antiques Ltd has decided to meet the criteria of 3.5 year PBP. In both projects
PBP value is less than its expectation. Thus, both investments are less risky and in both cited
firm can recover its invested amount soon. So it can be said that both investments are viable for
the Clariton Antiques Ltd, but if it has to select one then it should go with project 2 because in
this cited firm will be able to pay back its money within 3.08 years.
Average rate of return (ARR):
It is another technique which concentrates on returns over investment. Formula:
ARR = Total net profit / No. of year / Initial cost *100 Strength: As it gives result is percentage so company can compare it easily. Profitability
is the major concern of this method.
Weakness: Terminal value and time factor completely ignored by the ARR (Winch and
Leiringer, 2016).
Investment 1 Investment 2
£m £m
Initial investment 8.6 4.4
1 1.6 0.8
2 2.8 1.4
12
3 3.4 2
4 3.6 2.4
5 4 2.3
6 4.2 2.6
Total 19.6 11.5
Average 3.26 1.9166
ARR 37.98% 43.56%
From the above calculation it can be said that Clariton Antique Ltd should invest in
project 2. As it was assuming value of ARR is 35% and both investments are giving results more
than its expectation. But Investment in project 2 would give high return to the cited firm.
Net present value (NPV):
It is good tool that focuses on the difference between present cash outflow value and
future cash inflow. Formula: Strength: It helps to select such project in which company can generate income soon.
Weakness: It avoids unforeseen costs that is why results do not matched with the
expectations.
Investment 1 PV @ 14% Present value Investment 2
PV @
14%
Present
value
£m £m £m £m
Initial
investment 8.6 4.4
1 1.6 0.877 1 0.8 0.877 1
2 2.8 0.769 2 1.4 0.769 1
3 3.4 0.675 2 2 0.675 1
4 3.6 0.592 2 2.4 0.592 1
5 4 0.519 2 2.3 0.519 1
6 4.2 0.456 2 2.6 0.456 1
Total 12 7
NPV 3.38 2.53
13
4 3.6 2.4
5 4 2.3
6 4.2 2.6
Total 19.6 11.5
Average 3.26 1.9166
ARR 37.98% 43.56%
From the above calculation it can be said that Clariton Antique Ltd should invest in
project 2. As it was assuming value of ARR is 35% and both investments are giving results more
than its expectation. But Investment in project 2 would give high return to the cited firm.
Net present value (NPV):
It is good tool that focuses on the difference between present cash outflow value and
future cash inflow. Formula: Strength: It helps to select such project in which company can generate income soon.
Weakness: It avoids unforeseen costs that is why results do not matched with the
expectations.
Investment 1 PV @ 14% Present value Investment 2
PV @
14%
Present
value
£m £m £m £m
Initial
investment 8.6 4.4
1 1.6 0.877 1 0.8 0.877 1
2 2.8 0.769 2 1.4 0.769 1
3 3.4 0.675 2 2 0.675 1
4 3.6 0.592 2 2.4 0.592 1
5 4 0.519 2 2.3 0.519 1
6 4.2 0.456 2 2.6 0.456 1
Total 12 7
NPV 3.38 2.53
13
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It can be said that project 2 would be viable as in his value of NPV is less than project 1.
In this it will be able to generate good income soon (Atanassov, 2015).
TASK 4
4.1 key components of financial statements Income statement: it has two main elements ; profit and loss. It includes earnings and
expenses in it and then calculate net profit or loss of the company. Statement of cash flow: Two major components of cash flow statement in the Clariton
Antique Ltd are cash inflow and outflow (Alagathurai, 2014). Statements of change in equity and gain: Shareholder equity is one on the main elements
and retained earning is another component of financial statement. Statement of financial position: It has three components; assets, liability and equity.
Assets has two parts current and non current, liability has another two parts current and
non current.
Notes to the financial statements: These footnotes provide additional information about
operation and position of the company.
4.2 Formats of financial statements
Sole trader:
Such type of business do not follow international accounting standards. They include
expenses and income in the profit and loss account, not necessary to include corporate tax in it.
Balance sheet consists of two components assets and liability.
Partnership firm:
It is necessary to include profit of all partners in the income statements. Dividend is
necessary to pay to all stakeholders that will show in the balance sheet of the company ( Winch
and Leiringer, 2016). Tax is necessary to pay by partnership firms so that net profit can be
calculated by them it shows in the income statement.
14
In this it will be able to generate good income soon (Atanassov, 2015).
TASK 4
4.1 key components of financial statements Income statement: it has two main elements ; profit and loss. It includes earnings and
expenses in it and then calculate net profit or loss of the company. Statement of cash flow: Two major components of cash flow statement in the Clariton
Antique Ltd are cash inflow and outflow (Alagathurai, 2014). Statements of change in equity and gain: Shareholder equity is one on the main elements
and retained earning is another component of financial statement. Statement of financial position: It has three components; assets, liability and equity.
Assets has two parts current and non current, liability has another two parts current and
non current.
Notes to the financial statements: These footnotes provide additional information about
operation and position of the company.
4.2 Formats of financial statements
Sole trader:
Such type of business do not follow international accounting standards. They include
expenses and income in the profit and loss account, not necessary to include corporate tax in it.
Balance sheet consists of two components assets and liability.
Partnership firm:
It is necessary to include profit of all partners in the income statements. Dividend is
necessary to pay to all stakeholders that will show in the balance sheet of the company ( Winch
and Leiringer, 2016). Tax is necessary to pay by partnership firms so that net profit can be
calculated by them it shows in the income statement.
14
15
Illustration 1: balance sheet of partnership firm
Source: (El Chami and et.al, 2015).
Illustration 3: income statement of partnership firm
Source: (Winch and Leiringer, 2016)
Illustration 2: balance sheet of sole traders
Source: (Alagathurai, 2014)
Illustration 1: balance sheet of partnership firm
Source: (El Chami and et.al, 2015).
Illustration 3: income statement of partnership firm
Source: (Winch and Leiringer, 2016)
Illustration 2: balance sheet of sole traders
Source: (Alagathurai, 2014)
16
Illus
tration 4: income statement of sole trader
Source: (Atanassov, 2015)
Illus
tration 4: income statement of sole trader
Source: (Atanassov, 2015)
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Illustration 5: balance sheet of limited firm
Source: (Fischer and Marsh, 2015)
17
Source: (Fischer and Marsh, 2015)
17
Illustrat
ion 6: income statement of limited firm
Source: (Fischer and Marsh, 2015)
4.3 Interpretation of financial ratios
Profitability ratio: Gross margin ratio: It calculates the gross profit percentage of the company. From the
above calculation it is found that in the year 2015 it was 14.34% whereas in 2016 it was
14.18%. Which means cost of sold good has been increased in the Clariton Antiques Ltd. Operating margin profit: That shows operating profit of the cited firm has been
increased, in 2015 it was 3.77% but in 2016 it was 4.54%. So it can be interpreted that
management of operation in the Clariton Antiques Ltd is good.
Net margin ratio: In 2015 net margin ratio was 1.89% but in 2016 it was 2.63%. that
shows that debt amount has been decreased.
18
ion 6: income statement of limited firm
Source: (Fischer and Marsh, 2015)
4.3 Interpretation of financial ratios
Profitability ratio: Gross margin ratio: It calculates the gross profit percentage of the company. From the
above calculation it is found that in the year 2015 it was 14.34% whereas in 2016 it was
14.18%. Which means cost of sold good has been increased in the Clariton Antiques Ltd. Operating margin profit: That shows operating profit of the cited firm has been
increased, in 2015 it was 3.77% but in 2016 it was 4.54%. So it can be interpreted that
management of operation in the Clariton Antiques Ltd is good.
Net margin ratio: In 2015 net margin ratio was 1.89% but in 2016 it was 2.63%. that
shows that debt amount has been decreased.
18
Liquidity ratio:
19
19
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Current ratio has been increased by 2.41 to 2.48%. Clariton is doing well and there is
high chances to get high income in the future. Quick ratio shows that cited firm is able to meet its
obligations, as in 2015 it was 2.27 but in 2016 it was 2.33%.
Gearing ratio:
It is the ratio which compare equity and borrowed fund of the organization (Gearing
Ratio, 2017).
From the calculation it can be said that debt has been increased as in 2015 it was 0.16 but
in 2016 it increased to 0.19.
CONCLUSION
From the above report it can be concluded that financial management can support in
improving economic position of the company. Retained earning and bank loans are most
appropriate sources which can help in increasing capital of the company. Both these sources
have less cost and Clariton can bear this cost. From the calculation of NPV, ARR and PBP it can
be said that project 2 is viable and if cited firm invest in this then it can generate good income.
From the ratio analyses it can be articulated that Clariton is performing well and it has
capabilities to expand its business and to earn huge profit.
20
high chances to get high income in the future. Quick ratio shows that cited firm is able to meet its
obligations, as in 2015 it was 2.27 but in 2016 it was 2.33%.
Gearing ratio:
It is the ratio which compare equity and borrowed fund of the organization (Gearing
Ratio, 2017).
From the calculation it can be said that debt has been increased as in 2015 it was 0.16 but
in 2016 it increased to 0.19.
CONCLUSION
From the above report it can be concluded that financial management can support in
improving economic position of the company. Retained earning and bank loans are most
appropriate sources which can help in increasing capital of the company. Both these sources
have less cost and Clariton can bear this cost. From the calculation of NPV, ARR and PBP it can
be said that project 2 is viable and if cited firm invest in this then it can generate good income.
From the ratio analyses it can be articulated that Clariton is performing well and it has
capabilities to expand its business and to earn huge profit.
20
REFERENCES
Books and Journals
Abazieva, K. G. and et.al., 2015. Methods of Management of Public Financial
Resources.Mediterranean Journal of Social Sciences. 6(3). pp.60.
Abraham, T. W., 2015. Financial innovation and poverty reduction: evidence from rural northern
nigeria.
Acciaro, M., 2014. A real option application to investment in low-sulphur maritime
transport. International Journal of Shipping and Transport Logistics. 6(2). pp.189-212.
Aktas, R. and et.al., 2015. The Determinants of Banks' Capital Adequacy Ratio: Some Evidence
from South Eastern European Countries. Journal of Economics and Behavioral
Studies. 7(1). pp.79.
Alagathurai, A., 2014. Impact of Corporate Governance Practices on Firm Capital Structure and
Profitability: A Study of Selected Hotels and Restaurant Companies in Sri Lanka. Browser
Download This Paper.
Atanassov, J., 2015. Arm’s length financing and innovation: evidence from publicly traded
firms. Management Science. 62(1). pp.128-155.
Brewster, C., Mayrhofer, W. and Cooke, F. L., 2015. 20. Convergence, divergence and diffusion
of HRM in emerging markets. Handbook of human resource management in emerging
markets. pp.451.
Dimmock, S. G., Gerken, W. C. and Grahm, N. P ., 2015. Is Fraud Contagious? Career
Networks and Fraud by Financial advisers. Working paper.
El Chami, D. and et.al., 2015. The economics of irrigating wheat in a humid climate–A study in
the East of England. Agricultural Systems. 133. pp.97-108.
Fischer, M. and Marsh, T., 2015. Tax Abatements: Evaluation and Reporting.Journal of
Accounting and Finance. 15(5). pp.54.
Florackis, C., Kanas, A. and Kostakis, A., 2015. Dividend policy, managerial ownership and debt
financing: A non-parametric perspective. European Journal of Operational
Research. 241(3). pp.783-795.
21
Books and Journals
Abazieva, K. G. and et.al., 2015. Methods of Management of Public Financial
Resources.Mediterranean Journal of Social Sciences. 6(3). pp.60.
Abraham, T. W., 2015. Financial innovation and poverty reduction: evidence from rural northern
nigeria.
Acciaro, M., 2014. A real option application to investment in low-sulphur maritime
transport. International Journal of Shipping and Transport Logistics. 6(2). pp.189-212.
Aktas, R. and et.al., 2015. The Determinants of Banks' Capital Adequacy Ratio: Some Evidence
from South Eastern European Countries. Journal of Economics and Behavioral
Studies. 7(1). pp.79.
Alagathurai, A., 2014. Impact of Corporate Governance Practices on Firm Capital Structure and
Profitability: A Study of Selected Hotels and Restaurant Companies in Sri Lanka. Browser
Download This Paper.
Atanassov, J., 2015. Arm’s length financing and innovation: evidence from publicly traded
firms. Management Science. 62(1). pp.128-155.
Brewster, C., Mayrhofer, W. and Cooke, F. L., 2015. 20. Convergence, divergence and diffusion
of HRM in emerging markets. Handbook of human resource management in emerging
markets. pp.451.
Dimmock, S. G., Gerken, W. C. and Grahm, N. P ., 2015. Is Fraud Contagious? Career
Networks and Fraud by Financial advisers. Working paper.
El Chami, D. and et.al., 2015. The economics of irrigating wheat in a humid climate–A study in
the East of England. Agricultural Systems. 133. pp.97-108.
Fischer, M. and Marsh, T., 2015. Tax Abatements: Evaluation and Reporting.Journal of
Accounting and Finance. 15(5). pp.54.
Florackis, C., Kanas, A. and Kostakis, A., 2015. Dividend policy, managerial ownership and debt
financing: A non-parametric perspective. European Journal of Operational
Research. 241(3). pp.783-795.
21
Guerrero-Baena, M. D. and et.al., 2015. A multicriteria method for environmental management
system selection: an intellectual capital approach. Journal of cleaner production. 105.
pp.428-437.
Locatelli, G. and et.al., 2015. Load following with Small Modular Reactors (SMR): A real
options analysis. Energy. 80. pp.41-54.
Meyskens, M. and Bird, L., 2015. Crowdfunding and value creation.Entrepreneurship Research
Journa. 5(2). pp.155-166.
Nan, L. and Wen, X., 2014. Financing and investment efficiency, information quality, and
accounting biases. Management Science. 60(9). pp.2308-2323.
Opitz, C. and Hofmann, K. H., 2014. Adverse Selection and Moral Hazard in Equity
Partnerships: Evidence from Hollywood's Slate Financing Agreements. Journal of
Economics & Management Strategy. 23(4). pp.811-838.
Petrakis, P. E., Kostis, P. C. and Kafka, K. I., 2016. Secular stagnation, faltering innovation, and
high uncertainty: New-era entrepreneurship appraisal using knowledge-based
thinking. Journal of Business Research. 69(5). pp.1909-1913.
Vladimirov, V., 2015. Financing bidders in takeover contests. Journal of Financial
Economics. 117(3). pp.534-557.
Winch, G. and Leiringer, R., 2016. Owner project capabilities for infrastructure development: A
review and development of the “strong owner” concept. International Journal of Project
Management. 34(2). pp.271-281.
Yildiz, Ö., 2014. Financing renewable energy infrastructures via financial citizen participation–
The case of Germany. Renewable Energy. 68. pp.677-685.
Zerban, A., Omar, R. and Al Sibani, W. Z. S., 2015. Risk management during time of financial
turbulence: the case of saudi arabia and oman. European Journal of Contemporary
Economics and Management. pp.64.
Online
Cash Budget, 2017. [Online]. Available through: <http://businessjargons.com/cash-
budget.html>. [Accessed on 2nd February 2017].
Gearing Ratio, 2017. [Online]. Available through: <http://www.accountingtools.com/gearing-
ratio>. [Accessed on 2nd February 2017].
22
system selection: an intellectual capital approach. Journal of cleaner production. 105.
pp.428-437.
Locatelli, G. and et.al., 2015. Load following with Small Modular Reactors (SMR): A real
options analysis. Energy. 80. pp.41-54.
Meyskens, M. and Bird, L., 2015. Crowdfunding and value creation.Entrepreneurship Research
Journa. 5(2). pp.155-166.
Nan, L. and Wen, X., 2014. Financing and investment efficiency, information quality, and
accounting biases. Management Science. 60(9). pp.2308-2323.
Opitz, C. and Hofmann, K. H., 2014. Adverse Selection and Moral Hazard in Equity
Partnerships: Evidence from Hollywood's Slate Financing Agreements. Journal of
Economics & Management Strategy. 23(4). pp.811-838.
Petrakis, P. E., Kostis, P. C. and Kafka, K. I., 2016. Secular stagnation, faltering innovation, and
high uncertainty: New-era entrepreneurship appraisal using knowledge-based
thinking. Journal of Business Research. 69(5). pp.1909-1913.
Vladimirov, V., 2015. Financing bidders in takeover contests. Journal of Financial
Economics. 117(3). pp.534-557.
Winch, G. and Leiringer, R., 2016. Owner project capabilities for infrastructure development: A
review and development of the “strong owner” concept. International Journal of Project
Management. 34(2). pp.271-281.
Yildiz, Ö., 2014. Financing renewable energy infrastructures via financial citizen participation–
The case of Germany. Renewable Energy. 68. pp.677-685.
Zerban, A., Omar, R. and Al Sibani, W. Z. S., 2015. Risk management during time of financial
turbulence: the case of saudi arabia and oman. European Journal of Contemporary
Economics and Management. pp.64.
Online
Cash Budget, 2017. [Online]. Available through: <http://businessjargons.com/cash-
budget.html>. [Accessed on 2nd February 2017].
Gearing Ratio, 2017. [Online]. Available through: <http://www.accountingtools.com/gearing-
ratio>. [Accessed on 2nd February 2017].
22
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