International Finance - Report

Running head: INTERNATIONAL FINANCE
International Finance
Name of the Student:
Name of the University:
Author Note

1MOD006884 INTERNATIONAL FINANCE
Executive Summary:
The report highlights the effective use of investment appraisal technique such as payback
period, net present value and international rate of returns. The business proposal of Superior
Equipment Ltd directly violates the corporate social activities attributes, as large chunk of the
workforce would be laid off after the implementation of the project. In addition, the proposed
project aims to reduce the expenses of wages and salaries for Superior Equipment Ltd, while
boosting their net profits in the process. Thus, appropriate investment appraisal techniques
have been used for determining the significance of the proposed investment and the benefits
it could generate in the long run.

2MOD006884 INTERNATIONAL FINANCE
Table of Contents
Introduction:...............................................................................................................................3
a. Completing an up to date estimation of the company’s cost of capital by utilising publicly
available data:.............................................................................................................................3
b. Using the spreadsheet model forecasting that have an impact on the 5 years business case
proposal:.....................................................................................................................................5
c. Utilising the investment appraisal techniques and critically analysing the project:...............6
d. Depicting the measures that the company could utilise for meeting the funding
requirements of the project:.......................................................................................................8
e. Analysing the corporate social responsibility issues that is raised from the proposal:........10
f. Providing recommendations for the organisation:................................................................11
Conclusion:..............................................................................................................................12
References and Bibliography:..................................................................................................13
Appendices:..............................................................................................................................15

3MOD006884 INTERNATIONAL FINANCE
Introduction:
The report focuses on analysing the activities of Superior Equipment Ltd is a UK-
based privately-owned manufacturing company for the current financial year. Furthermore,
the stagnation in the overall performance of the organisation is mainly analysed and
evaluated to determine the best possible investment options, which can be used for improving
their income in the long run. From the analysis of the case study, it has been detected that the
company can cutdown on their current employee by automating their manufacturing process,
which increases their savings. Thus, appropriate investment appraisal techniques have been
used for determining the significance of the proposed investment and the benefits it could
generate in the long run.
a. Completing an up to date estimation of the company’s cost of capital by utilising
publicly available data:
In context with appendix 1, the overall valuations that has been used for calculating
the cost of capital is appropriately depicted in the tables. The data presented in the tables
directly portray the level of alternative capital that is used by Superior Equipment Ltd for
appropriately supporting their capital requirements. The cost of equity is mainly required by
for detecting the appropriate level of cost of capital for the organisation, which is used in the
investment appraisal techniques such as Net present value. Thus, the data is presented for
detecting the level of debt, loan stock and equity that is being used by Superior Equipment
Ltd for supporting their privately-owned manufacturing process. Hence, the calculations in
appendix 1 directly highlights the level cost of equity, cost of loan stock and cost of debt by
adequately utilizing the company data. Baum and Crosby (2014) stated that with the use of
appropriate data investors are able to determine the level of cost that is associated with
different source of finance used by the company.