Managing Financial Resources and Decisions - Burberry PLC Assignment

Added on - 03 Dec 2019

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MANAGING FINANCIAL RESOURCES AND DECISIONS
Table of ContentsINTRODUCTION..........................................................................................................................4ASSIGNMENT NUMBER: PART 1..............................................................................................41.1 Indentifying the sources of finance available to the business................................................42.1 Evaluating cost of different source of finance-......................................................................61.2 Implication of the different sources identified above-...........................................................7ASSIGNMENT NUMBER: PART 2.............................................................................................72.2 Importance of financial planning-..........................................................................................72.3 Information requirement of different stakeholders-...............................................................81.3 Measuring the appropriate source of finance for a business-...............................................92.4 Impact of finance on the financial statements-....................................................................104.1 Main financial statements-...................................................................................................104.3 Analyzing and interpretation of financial statements using ratios-.....................................113.1 Analyze budgets and make appropriate decisions...............................................................133.2 Calculation of unit costs and make pricing decisions using relevant information..............14CONCLUSIONS & RECOMENDATIONS.................................................................................14REFERENCES..............................................................................................................................15
Table of Figures
INTRODUCTIONToday's business organizations are striving hard to successfully compete in the market. Abusiness entity will able to establish strong position in the market when it has sufficientavailability of finance. Finance refers to the funds which are obtained for the effectively carryout of business activities. Once the funds are obtained it is very essential to effectively manageand control that funds because any mishandling of funds can evoke big difficulty before thebusiness firm. Therefore proper managing of financial resources is very crucial for any businessentity as its all activities are based upon the availability of finance (Davison and Warren, 2009).In order to explain how financial decisions and resources are managed in the firm this isprepared. The report is will evaluate the aspect of management of financial resources anddecisions in the context of Burberry PLC. The company is one of the oldest luxuries BritishBrand which performs business in fashion industry.ASSIGNMENT NUMBER: PART 11.1 Indentifying the sources of finance available to the businessA business organization requires finance for various activities like working capitalmanagement, procurement of raw material, expansion of new business territory, development ofnew product, modification in the existing business and etc (Singh, Jain and Yadav, 2012).Therefore it could be state that business entities require finance for different purposes which isbroadly categories into short-term financial need, medium term financial need and long-termfinancial requirement (Shapiro, 2009.). To fulfill these financial need, a business entity hasvarious options for obtaining the finance which are explained below in detail-Figure1: Sources of financeInternal source of Finance:Internal source of finance refers to the obtaining of financefrom within the organization itself. A entity could raise finance internally by selectinggiven below sources-a)Retained Earnings-Every business organization like Burberry Plc keptcertain portion of profit within the business itself for further expansion anddevelopment of the business (Paramasivan, 2009). This portion of profit is known4
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