Financial Management and Control

Financial Management and
control

Table of Contents
INTRODUCTION...........................................................................................................................1
PART A...........................................................................................................................................1
1. .................................................................................................................................................1
b...................................................................................................................................................4
PART B............................................................................................................................................6
1 Calculation of investment appraisal techniques.......................................................................6
2 Evaluation of key benefits and the limitations of investment appraisal techniques...............10
3 Suitable sources of finance for funding the investments. .....................................................12
PART C..........................................................................................................................................12
1. Critically evaluating process of budgeting and the manner in which strategic plan,
objectives and the budgets are inter-related..............................................................................12
CONCLUSION..............................................................................................................................14
REFERENCES .............................................................................................................................15

INTRODUCTION
It is vital activity of the organisation. This is process to plan, organise, control and to
monitor the financial resources with view of achieving the organisational goals & objectives.
This is related with the practice to control financial activities of organisation like funds
procurement, utilisation of the funds, payments, accounting, assessment of risks and other factors
related with money. It is the application of management principles to possessions of the
enterprise. Management of the organisational finance provides quality fuel & regular services for
ensuring efficient functioning. Present report will enhance the strategic financial statement of the
enterprise. It will analyse the use of qualitative and quantitative accounting information in the
organisation. Report will will provide the understanding and knowledge of the theoretical
frameworks and concepts to the range of practical situations for proposing the solutions to the
strategic business problems.
PART A
1.
Ratio Analysis
Particulars Formula Amount (£)
2018 2019
Profitability ratio
Gross profit 9100 12200
Net sales 18000 23000
Gross profit ratio
Gross profit/Net
sales*100 50.56% 53.04%
Net profit 3220 4060
Net sales 18000 23000
Net profit ratio
Net profit/Net
sales*100 17.89% 17.65%
1

Liquidity ratio
Current assets 4150 5160
Current liabilities 14000 19260
Current ratio
Current
assets/Current
liabilities 0.29 0.26
Current assets 4150 5160
Inventory 1800 2360
Quick assets
Current assets-
inventory 2350 2800
Current liabilities 14000 19260
Quick ratio
Quick assets/Current
liabilities 0.16 0.14
Gearing ratio
Debt 2000 3500
Equity 10000 10000
Debt equity ratio Debt/Equity 0.2 0.35
Earnings before interest
and tax 5100 6800
Interest expense 500 1000
Interest coverage ratio
EBIT/Interest
expense 10.2 6.8
Asset utilisation ratio
Net sales 18000 23000
Average total assets 12000 15760
2