Risk and Profit Potential of GTN Limited

Running head: FINANCE
Finance
Name of the Student
Name of the University
Author Note

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Table of Contents
1. Introduction.........................................................................................................................2
2. Risk and profit potential of GTN Limited..........................................................................2
2.1 Industry analysis...............................................................................................................2
2.2 Competitive strategy analysis:.........................................................................................3
3. Accounting analysis...............................................................................................................4
3.1 Nature of the financial statement.....................................................................................4
3.2 Performance Analysis......................................................................................................5
3.3 Notes for the financial statement......................................................................................5
4. Accounting Strategy and Evaluation..................................................................................6
5. Recasting financial statements:...........................................................................................8
Statement of profit and loss:......................................................................................................8
Statement of cash flow:..............................................................................................................9
Statement of financial position:.................................................................................................9
6. Conclusion:.......................................................................................................................10
7. References list...................................................................................................................11

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1. Introduction
In this report, profit and risk potential and accounting analysis of GTN Ltd has been
illustrated. The evaluation of accounting strategy and recasting financial statement is also
presented in the report. GTN Limited is one of the largest broadcast media advertising
platforms. It mainly operates in Australia, Canada and United Kingdom. It provides the
advertisers with high impact campaigns. GTN began operations in Australia in 1997
(Gtnetwork.com.au, 2019). It provides a broad reach advertising platform that enables the
advertisers to reach large audiences effectively.
2. Risk and profit potential of GTN Limited
2.1 Industry analysis
Porter’s Five Forces is a strategic management tool. In these report five competitive
forces is used to effect viability and prepare a strategy for the development of GTN Ltd.
Rivalry between the existing competitors-The market in which GTN Ltd operates is
very competitive. Though it has concentrated competition amongst the present competitors in
Media sector, it has built a suitable distinction. The process of collaborating the competitors
is suitable, as it will result in increase of market size relatively than only opposing for the
minor market. By doing these, GTN Ltd does build up a scale and can compete better.
Threats of New Entrants- The way GTN Ltd tackle the threats is by inventing new
products and services. To attract new clients and to give old client a aim to purchase GTN
Ltd products. The economies of scale should be maintained in order to reduce the fixed cost
per unit. They have to spend money on exploration and expansion in addition to build
capacities. The opportunity for new applicants is very few as GTN Ltd keeps on defining the

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standards regularly and it has a huge market presence. Thus, it reduces the opportunity for the
new firms to earn extraordinary profits in the industry.
Bargaining Power of Buyers- GTN Ltd has a big network of clients. This can prove
a chance for the organization to simplify its revenue and production method and decrease the
negotiating power of consumers. It often gives reductions and contributions on the
recognized products to seek customers; and by inventing new products. If there is new
products in market than the negotiating power of the consumers becomes less (Campbell et
al., 2018). Therefore, the customers use to get attracted to new product launches and there is
less diversification of existing customers.
Bargaining Power of Suppliers- GTN Ltd has an efficient supply chain with
multiple suppliers. The company use to experiment with the new product designs and with
new diverse materials, so that if one of the raw materials values increases up it will shift to
another (Roslender and Nielsen, 2018). There are many suppliers whose firm is dependent
upon the firm; it is beneficial for the GTN Ltd as they has a less bargaining power compared
to other manufacturers.
Threats of Substitute Products or Services-The risk of substitute product is more as
a new products or services meet a comparable client required in numerous ways. The way
GTN Ltd tackles the threats is by rendering service and not only delivering products. By
realizing the basic needs of the consumers, it can develop an idea what the customer wants. If
the switching cost of the products is increased, then it will be easy for the company to control
the threat (Kihn & Ihantola, 2015).
2.2 Competitive strategy analysis:
i) Cost Leadership - The main generic strategy is to keep the position as market
leader used by GTN limited is cost leadership. It can be done through an efficient