Financial Statement Analysis Assignment (Doc)
Added on 2021-02-20
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Table of ContentsINTRODUCTION................................................................................................................................3MAIN BODY.......................................................................................................................................3Evaluation of performance of Tesco Plc and Sainsbury using various tools and techniques ....3Importance of analysing the working capital of Tesco Plc and Sainsbury Plc in Decision- Making...................................................................................................................................................18Analysis of Annual Cash Flows over the last two years of Tesco Plc and Sainsbury...............20CONCLUSION..................................................................................................................................21REFERENCES...................................................................................................................................22
INTRODUCTIONFinancial Analysis Management and Enterprise refers to analysis of Financial Statements ofdifferent companies in order to evaluate financial performance of two different companies. Analysiscan be done through different tools and techniques such as Ratio Analysis, Common SizeStatement, Comparative Size Statement etc (Williams, 2017). These tools help in examiningfinancial position of companies and comparing companies in order to know which one isperforming better than other company. Tesco Ltd is a British Multinational Groceries headquarteredin England, United Kingdom. It was established in Year 1919 by Jack Kohen. According to year2019, company is having revenue of 6,391.1 Crores GBP. Sainsbury Plc is a public Limitedcompany engaged in business of retail industry. It was established in year 1869 by John JamesSainsbury. Company is having net income of £309 million. This report emphasis on financialperformance of tesco and Sainsbury Plc in order to compare both companies financial position.Ratio Analysis has been used in order to compare both companies financial performance. Further,there is comparison of working capital and cash flow statement. It covers comparison of financialstatements of both companies inn order to evaluate and examine which company is better than othercompany. MAIN BODYEvaluation of performance of Tesco Plc and Sainsbury using various tools and techniques
In Sainsbury there is negative change in revenue as it can bee observed that in year 2017 company was having 11.6% which decreased to 1.9% in year 2019. As compared to that of Tesco Plc, there is positive change in revenue from 2.73% in year 2017 to 11.17% in year 2019 (Sainsbury Reports, 2019). This shows that Tesco is having positive increase in revenue and company should maintain same % change in revenue year on year. Net Income of Sainsbury has
also gone negative as compared to that of Tesco Plc where there is a positive change in net income of company. Balance sheet: SainsburyBalance sheet: Tesco
In both companies there is negative change in current assets which shows that both companies are not purchasing more of current assets as compared to that of current liabilities held incompany (Tesco Plc Reports, 2019). Companies are properly maintaining there assets in company but they should more invest in assets which are productive for companies and are useful higher returns for companies.
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