Corporate Finance Discussion 2022

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

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CORPORATE FINANCE
Table of Contents
Task 2- Discussion.....................................................................................................................3
Task 3- Information Leaflet.......................................................................................................4
Task 4- Capital Expenditure Appraisal......................................................................................6
References................................................................................................................................10

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CORPORATE FINANCE
Task 2- Discussion
(a) Interpretation of the Financial Statements of Samsung Plc
The financial Statement for three consecutive years is taken into consideration. The
third quartered financial review at September 30, 2019 is used for understanding the current
trends of the organisation. Interim reports at December 31 for both the financial year 2017
and 2018 is used to identify the unusual trends of the business. Ratio analysis is calculated for
the three financial year 2017, 2018 and 2019 by using their financial statements.
(b) Ratio Analysis
(a) Liquidity Ratios
The company has maintained an ideal current ratio of 2:1 in the three consecutive
year. It has the capacity to pay their short-term obligations (Images.samsung.com, 2020). It
has also maintained an ideal quick ratio of 1:1 and the cash ratio is also sufficiently
maintained. Therefore, Samsung PLC is in a good liquidity position.
(b) Leverage Ratios

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CORPORATE FINANCE
There is an increase in debt to equity ratio and Interest Coverage ratio, as compared to
the three financial year. This indicates that, the company has enough debt and has not
generated enough profit in the last three consecutive years.
(c) Efficiency Ratios
There is a decrease in inventory turnover ratio. This is due to decrease in the revenue
of the business (Samsung global, 2020). The asset turnover ratio also decreases; this
indicates that the company has not efficiently used its assets for doing its business operations.
(d) Profitability Ratios
It can be seen from the above findings that, all the profitability ratios have been
increased in the three financial years 2017, 2018 and 2019. This indicates that, Samsung is in
a good financial position.
Task 3- Information Leaflet
(c) The impact of Creative Accounting techniques on Strategic decision-making
Creative accounting is the accounting technique, which is used not to follow the required
accounting standards and principles.