Project Report: Financial management and control
Added on 2020-03-15
17 Pages3958 Words93 Views
RUNNUNG HEAD: Financial management and control1Project Report: Financial management and control
Financial management and control2ContentsPart A.....................................................................................................................................................3A report on the performance of Zurich Plc Ltd......................................................................................3Ratios:....................................................................................................................................................3Profitability ratios:.............................................................................................................................3Limitations:........................................................................................................................................4Liquidity ratios:..................................................................................................................................4Limitations.........................................................................................................................................4Gearing Ratios:..................................................................................................................................4Limitations.........................................................................................................................................5Asset Utilization ratio:.......................................................................................................................5Limitations.........................................................................................................................................6Investment ratio:...............................................................................................................................6Limitations.........................................................................................................................................6Task 2:...................................................................................................................................................8Que a.................................................................................................................................................8Calculation of Net Present Value.......................................................................................................8Calculation of Payback period...........................................................................................................8Calculation of Discounted Payback period........................................................................................9Calculation of IRR.............................................................................................................................10Calculation of ARR...........................................................................................................................11Que b)..............................................................................................................................................12The Payback Period:........................................................................................................................12Key Benefits.................................................................................................................................12Limitations...................................................................................................................................12The discounted Payback Period.......................................................................................................12Key Benefits.................................................................................................................................12Limitations:..................................................................................................................................13The Accounting Rate of Return........................................................................................................13Key Benefits.................................................................................................................................13Limitations...................................................................................................................................13The Net Present Value.....................................................................................................................14
Financial management and control3Key Benefits.................................................................................................................................14Limitations...................................................................................................................................14The Internal Rate of Return.............................................................................................................15Key Benefits.................................................................................................................................15Limitations...................................................................................................................................15Que c)..............................................................................................................................................15Internal and external sources of the company................................................................................15References:..........................................................................................................................................17
Financial management and control4Part A:A report on the performance of Zurich Plc Ltd:For analyzing the performance and position of Zurich Plc, financial position trends e been analyzed and the ratio analysis study has been conducted on 2015 and 2016 year’s data (Shapiro, 2005). In the study off ratio analysis, various ratios have been calculated which are as follows: Ratios:Profitability ratios:Profitability ratios of a company expresses about the company’s ability to create the revenue in comparison of various expenses and the cost of the company. Profitability ratios of Zurich Plc Ltd are as follows:1.Gross profit margin – Gross profit/revenue x 1002.Net profit margin – Retained earnings/revenue x 1003.Return on assets – Retained earnings/total assets x 1004.Return on shareholder’s equity – Retained earnings/shareholder’s equity x1005.Return on capital employed – Retained earnings/capital employed x 100(Romney, Steinbart, Zhang and Xu, 2006)Profitability ratio analysisProfitability Ratios20162015Return on shareholder fund0.0489560.028693ROCE0.0937950.071527Gross profit ratio0.3901690.358616Gross Profit£ 7382£ 5825net profit ratio0.0514190.035103(Kurov and Stan, 2016)The profitability ratios of the company depict that the overall performance of the company has been enhanced from last year. This depicts that the financial activities and performance of the company is becoming better (Kiran and Singh, 2014). The company’s profitability ratios depict about return on shareholder fund which was 0.028 in previous year and has been increased in current year to 0.049 (Deegan, 2013). The ROCE, Gross profit ratio, Gross profit and Net profit ratio of the company has been improved from last year.
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