Finance Sources and Risk Analysis: A Case Study of Bradley Brewing Plc

This report discusses alternative sources of finance suitable for projects, using the case study of Bradley Brewing Plc. It explores options like crowdfunding, venture capital, angel investors, and retained earnings, highlighting their benefits and suitability for the company's growth. The report also explains how risk can be taken into account in investment appraisal, detailing a risk analysis model involving forecasting, project variable assessment, uncertainty prediction, sample development, and results analysis. The analysis aims to aid Bradley Brewing Plc in making informed investment decisions by assessing the risks associated with launching new products and managing existing operations.

Fundamentals of
Accounting and
Finance

Table of Contents
Fundamentals of Accounting and Finance.......................................................................................1
(A) Discuss alternative sources of finance suitable for the project of the case study Bradley
Brewing Plc............................................................................................................................3
B) Briefly explain how risk can be taken into account in investment appraisal....................4
References........................................................................................................................................5
Books & Journals...................................................................................................................5

INTRODUCTION
Accounting basics entail documenting, categorising, summarising, evaluating, and analyzing key
findings in accordance with accounting rules. All money transfers and occurrences are
documented in the accounting system. The evaluated results are then presented to the
increasingly diverse range consumers in the financial statement. The current report is focused on
the production of financial statements for a number of different businesses.
(A) Discuss alternative sources of finance suitable for the project of the case study
Bradley Brewing Plc
The purpose of establishing a business organization is to achieve success and growth in
long run. In order to achieve the organization's goals, it is highly important to discover and
explore some alternative sources of finance that can help the business to grow (CGMA, 2018).
These alternative sources will help the respective company to expand and attain higher level of
success in long run as well as short run. In context to the case study of Bradley Brewing Plc,
different sources of finance in accordance to the organization's needs are explained below:
 Crowd funding: It is a type of funding that is basically concerned with raising funds out
of large group of people for the projects. This type of funding is available for all types of
businesses whether small or large. Therefore, it will help Bradley Brewing Plc to raise
funds efficiently by using fewer resources.
 Venture Capital: It is a source of private equity that basically investors provide to the
start up business organizations. It not only helps in the acquiring the funds but it also
plays a major role in providing parallel support for skills in order to set up a firm based
on the marketing strategy in a effective way. This source can help Bradley Brewing Plc in
launching the new product AB Strong Ale.
 Angel Investors: This is considered as one of the most efficient source of finance for the
company. They often provide funds in exchange of the ownership rights. In relation to
Bradley Brewing Plc, angel investor can be one of the most suitable source of finance to
expand in the existing market.
 Retained Earnings: They are considered as the long term source of finance because
they are a part of the profit of the company. Retained earnings are the safest form of
finance because they are interest free (Fang and Olteanu-Veerman, 2020). While

considering Bradley Brewing Plc, retained earnings will be an convenient method to
finance its new projects.
B) Briefly explain how risk can be taken into account in investment appraisal.
Investment appraisal can be defined as an important part of investing decisions for a
business organization. It helps in analysing the profitability of an investment over a period of the
life of asset (Lorson, Jorgeand Haustein, 2019). With the help of this concept of risk analysis, a
complete profile of risk related to the project is provided to investors. It helps in analysing all the
possible results or outcomes which may result positively and negatively from decisions taken.
The tool of risk analysis helps the organization by supporting investment decisions in such a way
that it basically provides investors a measure of variance in accordance to the project. In context
to Bradley Brewing Plc, risk analysis for the purpose of investment appraisal can be done with
the help of a process mentioned below:
The respective company will have to go step by step by following the sequence
mentioned in the above process of risk ascertainment. Bradley Brewing Plc will have to forecast
the model based on present scenarios (Siswantoro, 2018). After that, it will have to keep a check
on project variables on the basis of which a new plan has been made. Once the project variables
are defined, probability of the uncertainty will be predicted for events which may occur in near
Illustration 1: Risk Analysis Model

future. After this, a representative sample of the different combination will be developed. This
process will come to an end with the analysis of results along with interpretations that will will
help in obtaining the desired results (Oueslati and Hammami, 2018).
Therefore, in this way Bradley Brewing Plc can assess the idea of launching a new beer
and stopping production of another product to come in the market simultaneously. This will help
in analysing the risks that may affect its business operations of the concerned company in an
effective manner.

References
Books & Journals
CGMA, C., 2018. Blockchain augmented audit–Benefits and challenges for accounting
professionals. The Journal of Theoretical Accounting Research, 14(1). pp.117-137.
Lorson, P. C., Jorge, S. and Haustein, E., 2019. European public sector accounting. Imprensa da
Universidade de Coimbra/Coimbra University Press.
Siswantoro, D., 2018. Sharia accounting standard for sukuk (Islamic bond) accounting in
Indonesia. Journal of Islamic Accounting and Business Research.
Oueslati, A. and Hammami, Y., 2018. Forecasting stock returns in Saudi Arabia and
Malaysia. Review of Accounting and Finance.
Fang, D. and Olteanu-Veerman, D., 2020. The case for factor investing in China A shares. The
Journal of Index Investing, 11(2). pp.76-91.