Financial Decision Making: Role of Accounting and Finance in Managing Company's Financial Activities

FINANCIAL DECISION
MAKING

EXECUTIVE SUMMARY
The project summarizes about financial decision making based on making proper analysis of
financial statements. The report abstracts about role of accounting and finance in the context of managing
various kinds of aspects. As well as second task of report summarizes about calculation of different types
of ratios and measurement of financial position of related company. On the basis of this, it can be
abstracted that Alpha limited company’s performance is better in year 2018 as compared to year 2017.

Contents
EXECUTIVE SUMMARY.........................................................................................................................3
INTRODUCTION.......................................................................................................................................5
MAIN BODY..............................................................................................................................................5
Task 1......................................................................................................................................................5
TASK 2...................................................................................................................................................8
Calculation of the ratios to analyse company performance:.....................................................................8
Interpretation and analysis of financial ratios:.........................................................................................9
CONCLUSION.........................................................................................................................................12
REFERENCES..........................................................................................................................................13

INTRODUCTION
The term financial decision-making can be described as the decision-making mechanism
within a business regarding all creditors, liabilities and other financial activities. Eventually,
financial decisions must be made correctly by businesses, because any mistaken judgment will
have an impact on development and productivity (Hirshleifer, Jian and Zhang, 2018).
Furthermore, on the basis of proper analysis of financial statements, companies make financial
decisions. The project report is split into two tasks in which the first task outlines the role of
company accounting and financing. The second task is based on measure and interprets the
financial data of Alpha limited company by help of various kinds of ratios. In order to complete
task one, a company is selected that is John Lewis and partners. John Lewis & Partners (formerly
John Lewis) is a chain of high-end UK-wide department stores. The Republic of Ireland and
Australia are both found in concessions. It was founded in 1929 by Spedan Lewis, son of its
creator John Lewis. The corporation is responsible for distributing general merchandise as part of
the mutual employees' union called "John Lewis Collaboration" and is the United Kingdom's
largest cooperative. Since 1925 the company claims to be 'never intentionally undersold' – it still
meets at least a lower cost provided by a highway regional rival.
MAIN BODY
Task 1
Define Accounting and Finance Department:
Accounting department- It is a part of an administration which prepares the financial statements,
retains the general leader, pay bills, billing customers, payroll, cost accounting, financial
reporting, etc. The department head of Accounting is considered as controller (Kubilay and
Bayrakdaroglu, 2016).