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Tui Travel Plc Operations | Report

   

Added on  2020-02-05

12 Pages3265 Words63 Views
ACCOUNTING

Table of ContentsINTRODUCTION......................................................................................................................3TUI Travel PLC's operations............................................................................................3Users of TUI travel PLC..................................................................................................4Financial statement analysis of TUI Travel PLC..............................................................5CONCLUSION .........................................................................................................................8REFERENCES...........................................................................................................................9APPENDIX..............................................................................................................................11

INTRODUCTIONEvery business organization is required to prepare necessary accounts to measuretheir performance on a regular basis. It is the process of recording all business transactions inan appropriate manner. Income statement and balance sheet are two major statementsprepared as financial statements of the business. The main purpose of profit and loss accountis o find out business profits while balance sheet prepares to determine organization’sfinancial status.. By using this statement, mangers of the company will able to evaluate andexamine organization’s performance and will take effective decisions to resolve the issues.Present project report will help to analyse financial performance of TUI Travel PLC throughratio analysis method. TUI Travel PLC's operationsTUI travel PLC is a UK based travel Group Company which was founded in the year2007 and it is listed on London Stock Exchange (LSE). It was established through merger ofFirst Choice Holidays and Tourism division of TUI AG. It serves customers at global marketand provides travelling services to large number of customers. Headquarter of TUI wasestablished in Crawley, West Sussex, UK. It has two subsidiaries that are Thomson Airwaysand Thomson Holidays. It is operating in 180 countries over the world while main operationsare in Central Europe, Northern Europe and Western Europe. It was established to fulfil itsvision that is about to make travel experience for the consumers and ensure businesssustainability. It mainly operates in three categories that are as under:MainstreamAccommodation and DestinationSpecialist and ActivityThus, it provides accommodation through hotels, motels. Travel industry is one of thefastest growing industries that make high contribution to government revenues in UK. That isthe most important reason for selecting TUI Travel PLC for the present report. . Travellingorganizations plays a major role in attracting large number of tourists of the countries andenlarge their revenues. it. It will increase foreign currency revenue and it will help ineconomic growth. In UK, TUI is one of the largest travel companies that are operatingworldwide. It is serving consumers at each and every destination so that travellers will feelbetter and highly satisfied..

Users of TUI travel PLCUsers are the individual who are directly or indirectly affected by the TUI's operationand have some kind of interest in company’s performance. TUI travel PLC has variousranges of internal as well as external users. Internal users are the persons who are availableinside the organization and are directly affected by the operations while external users areoutsiders which are described below;Internal users:Employees and managers are some of the internal users of TUI travel PLCEmployees: Workers plays a major role in TUI's success because they provide travelbased services to their travellers. Their aim is to get high salary, reward, appraisal and othermonetary awards. They use profit and loss account to determine business information. It isbecause high growth in revenue and profitability helps in fulfilling objectives and vice versa(Healy and Palepu, 2012). Moreover, they require safe and hazard free working environment,training and development program to improve their skills and work based knowledge. Managers: Managing directors, board of directors and departmental managers are theindividual who manages overall functioning of TUI. Therefore, they use income statement toexamine revenues and expenses and try to maximize their profits. On the other hand, balancesheet assists in analyzing financial health in relation to solvency, efficiency, liquidity andothers (Schweisfurth and Herstatt, 2016). Moreover, cash flow statement is used to measurethe changes between reported cash balances at two different balance sheet dates. They takedecisions and formulate operating policies so as to improve potential performance. External users: Lenders, customers, government, competitors, investors and creditors are theexternal users of TUI Group. They have different purpose and need various types ofinformation from company's financial statement. Out of these, some of the external users areexplained below:Lenders: Lenders are the persons who lend their own money to TUI and mitigate theirfinancial requirements. Their main purpose is to get regular amount of interest on their funds.Moreover, they desire to secure their money by keeping business assets as security. Forinstance, bank demand collateral security on the funds provided on loans so that funds will besecured. They need information about TUI's performance and financial strength. Henceforth,they analyse business profitability through profit and loss account. However, they alsodetermine TUI's capital structure and interest bearing capacity to take decisions that howmuch money can be given to the organization (ALLINI and et.al., 2015). Moreover, they

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