Financial decision making assignment PDF

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FINANCIALDECISION MAKING
Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1Role of the management accounting system and finance...........................................................1TASK 2............................................................................................................................................4Calculation of the ratios to analyse company performance from a potential investorsperspective...................................................................................................................................4CONCLUSION...............................................................................................................................8REFERENCES..............................................................................................................................10
INTRODUCTIONFinancial decision making is consider to be an important concept that is related withmaking of meaningful decision in order to utilize the available monetary resources in bestmanner which result into maximum benefit to company (Beaudoin, Cianci and Tsakumis, 2015).In companies mainly manager focuses on two sort of financing decision such as from where doesthe funds to be generated and how much funds to be borrowed from outside to run businessoperations. In today's business environment, corporations will have to consider many financialdecisions relating to funding, growth, cash flow and distributions of profit. In this project, WmMorrisons has been selected which is the fourth biggest supermarket company of UK.In this project, the role of accounting and finance within organisation and its criticalevaluation is discussed in the context of selected company. In addition to better understand theimportance of financial decision making with the help of financial statements ratio are calculatedand appropriate recommendation are given to potential investors.Overview of companyWm Morrisonswas founded in 1899 by William Morrison with an egg and butter stalland from there in 2016 it was 498 superstore all over England, Wales and Scotland (AboutMorrisons,2019). The company have number of product to be sold such as food items, medicalnecessities, cloths, basic household things etc. There are around 110000 employee employed togive extra ordinary services to huge number of people and the total revenue in 2018£17,262million and net profit was £311 million. Morrisons have the six main priorities such as be morecompetitive, serve customer with the best, find best solution, create more useful and effectiveservices, make more simple and specific process and most important make the core supermarketstrong enough.TASK 1Role of the management accounting system and finance.In modern business world, management accounting is defined as the process ofidentifying, assessing, analysing and defining the financial data into proper accounts whichsupport internal manager to make decision. InWm Morrisons,there are number of managementaccounting techniques used which support in defining the framework to manage and controldifferent operation so that predetermined goals can be achieved. These techniques also aid1
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