Provide a financial statement analysis of brickworks company

Assignment Help Managerial Accounting

Reference no: EM131917538

Business Analysis - Case Study

Case of Brickworks Company Limited: A Managerial Accounting Analysis

This task is designed to provide students with an opportunity to demonstrate their understanding of the concepts and techniques in management accounting, through the application of relevant material(s) covered in the subject and its prerequisite subject, to a real world case study. It involves the analysis of data and information relating to Brickworks Company limited from a management accounting point of view. Students are required to prepare a report in an academically acceptable form which comments on various aspects of the company.

- Informed
- Innovative and Flexible
- Connected

- Differentiate and apply different management accounting information and cost systems.
- Apply basic contemporary management accounting techniques for planning, controlling and decision making.
- Evaluate financial information relevant to management decision making.
- Communicate findings and/or recommendations to relevant audiences.
- Apply accounting information systems such as Excel to assist in business decision making.

The report should be 3,000 words maximum. This excludes the title page, executive summary, table of contents, charts, diagrams, tables, list of references and appendices.

Report Details

This assignment analyses Brickworks Company limited using a variety of sources including; company annual reports, company website, internet, newspapers and articles. The analysis utilises various management accounting processes, techniques and methods that you learned in ACCY918 subject and its prerequisite subject ACCY901. The report should address the following requirements:

A. Provide a brief summary of the company. Include details such as the industry sector, primary activities, and recent performance. The importance of this section is to effectively introduce the company, the nature of its business, identify the company's profit drivers and key risks, etc. This should be written in paragraph format.

B. Identify and comment on the Vision, Mission and key strategies of the company

C. Provide a financial statement analysis of Brickworks Company limited for 2017 using ratios and comment on the following aspects of the company
I. Liquidity
II. Efficiency
III. Leverage
IV. Profitability
V. Market value
VI. Overall financial performance and financial status.

D. Identify five measures that the company has taken to promote sustainability.

E. Prepare an analysis and summary of the major financial and non-financial strengths and weaknesses of the firm. Financial strengths and weaknesses are generally based on significant observations of your analysis (financial statements and ratios). Non-financial strengths and weaknesses are based more on anecdotal and specific evidence from research, etc. Based on your analysis in this section, indicate the company's strategies for solving its problems and its outlook for the future.

F. Use the figures in the consolidated income statement of the company annual report and prepare the followings: (1) summarised absorption costing income statement showing operating profit of the company (Hint: You may need to ignore some revenue and expense items presented in the current consolidated income statement to arrive at operating profit); (2) a contribution margin income statement for 2017. You may need to use appropriate cost classification methods and assumptions for this purpose. You may also consider cost of sales and selling expenses as mixed costs. Use an excel spreadsheet to prepare this statement and present it as a table in the case study report.

G. Using the contribution margin income statement you prepared in requirement (F) above and making realistic and logical assumptions about the trends, prepare a budgeted income statement for Brickworks Company limited for 2018 on an Excel Spreadsheet.

Your report should only show the budgeted income statement resulted from this analysis.

When preparing the excel file for this purpose, use a separate sheet on the excel file to record the input (unit prices, rates, assumptions, etc used for calculations) and another sheet to show the output (budgeted income statement). Detailed operational budgets such as sales budget, production budget, etc. are not required. Input and output sheets should be linked by formulas. In other words, the excel file should be readily available for sensitivity analysis ("what if analysis") i.e. if the manager change the input data or an assumption/s in the input file, he/she should be able to see the impact of the changes on the output sheet immediately. While only a summary of the results in the output sheet should be presented in the body of the report, the printout of all the sheets of the excel files (used for G and F) should be submitted as appendices. The soft copy of the excel file should also be submitted through the link on the Moodle site. Please make sure to use as many formulas (cost functions) as possible to obtain required estimates and to clearly state the assumptions you make for calculating your estimated figures for the 2018.

H. Managers regard relevance, accuracy, and timeliness as important characteristics of information. However, much of accounting information provided to managers does not rank highly on these criteria, because some management accountants are tied to financial models of reporting. To regain their role as primary information provides, management accountants need to become more directly involved in the operation of data collection and reporting systems, and move closer to the managers they are serving (McKinnon & Bruns 1992). In light of the above statement, provide 5 examples of information that management accountants can provide to managers of Brickworks Company limited to assist them in managing company resources (example, customer profitability analysis to identify the most important customers of Brickworks Company limited ).

I. Refer to the 2017 annual report of Brickworks Company limited and answer the following questions.

I. Can you identify cost objects in the annual report? If so, what are they?
II. Can you identify a product cost in the annual report? If so, what is it? and how much is it?
III. Identify three period costs, and explain why they are period costs.
IV. Would Brickworks Company limited be able to make use of cost-volume-profit analysis within its business operations? Explain.
V. Examine the segment information contained in the annual report and comment on the results.
VI. After examining the annual report, conclude whether there is a budgetary system in operation in Brickworks Company limited.
VII. What would be the key element driving a budgetary system for Brickworks Company limited? What budgets might the company prepare?

Download Brickworks Limited 2017 Annual Report

Reference no: EM131917538

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Reviews

len1917538

3/27/2018 7:18:57 AM

Style and Format 1. The report must be word processed using 12-point font (Times New Roman), 1.5 line spaced, and 3 cm left and right hand margins. Justified texts. 2. Use of appropriate headings, graphs, charts in the body of the report is encouraged. 3. Ensure that you have the capacity to provide a duplicate copy, should this be requested. Problems with computers, printers, software, lost disks, etc, will NOT be accepted as excuses for late submission. Always make a backup of your disks as you work. 4. Pages are to be consecutively numbered. 5. Referencing must follow an acceptable academic format using the Harvard style. 6. Do not plagiarise. Plagiarism is the unacknowledged work of another person. Plagiarism can result in zero marks or possibly expulsion. 7. Assignments may be penalised for failure to meet any of these requirements.

len1917538

3/27/2018 7:18:42 AM

5. Structure, Presentation and Style(5%)-Meets the required style and format requirement; academic writing style, clear expression, structure and readability; correct spelling, grammar, punctuation, length. 6. Referencing (5%) Harvard style of referencing used within the body of the report and in the reference list. Referenced all materials, except student’s own, used in the report. Demonstrates knowledge of the subject matter with relevant and adequate citations.

len1917538

3/27/2018 7:18:35 AM

1. Executive summary (5%)- Concise summary of the main points, arguments, conclusions, and recommendations. 2. Introduction (5%)- Concise summary of the main points, arguments, conclusions, and recommendations. 3. Content (75%)-Relevant and specific description/discussion on the aspect(s) of the company that you analyse and clear demonstration of the application of management accounting practices in the given context. Good use of evidence to support the points made in the report. 4. Conclusions (5%)- Concise summary of the main points, arguments, conclusions, and recommendations.

len1917538

3/27/2018 7:18:21 AM

6. In the event that any group encounters difficulty in achieving a consensus agreement, the subject coordinator will take the necessary actions required to resolve any areas of disagreement. 7. Normally, the mark awarded to the assignment will be the mark awarded to all members of the group. In exceptional circumstances, at the discretion of the subject coordinator, marks may be varied for individuals within the group when negative comments have been made by majority of group members in their reflective summaries about the lack contribution made by a group member in group activities.

len1917538

3/27/2018 7:18:13 AM

4. Once established, all group members will be required to meet at the earliest opportunity to discuss and agree how the group will be managed. This discussion should include the allocation of individual roles and responsibilities and an agreed internal process for resolving any disputes that may arise. 5. By 16th (end of week 6), the group leader should submit a ‘Group Contract’ to the link on the Moodle site, summarising the matters agreed by the group. This contract should be signed by all the members in the group.

len1917538

3/27/2018 7:18:05 AM

2. After forming a group, the group leader should register the group by submitting a word file to the link on the Moodle site indicating the names of the group members and their student ID numbers. Formation and registration of the group must be completed by 9(end of week 5). 3. The students who are unable to join a group by 9th will be grouped by the subject coordinator on 10th using the random appointment method. After the subject coordinator formed a group by this method, if a group member wants to leave and join another group, he/she needs to obtain a written consent from all members of the group that he/she is leaving and joining. Upon the receipt of this document, the subject coordinator will then make the change and inform all members of the relevant groups about the change.

len1917538

3/27/2018 7:17:57 AM

This is a GROUP assessment task that requires the preparation of a written report in the form of a Management Consultants report to the Board of Directors. Completion of the task will require the group to thoroughly analyse the company so as to enable the key issues to be identified and formulate a recommendation by applying relevant concepts covered in the ACCY918 subject and its prerequisite subject. Extensive additional research will be required. 1. Students need to establish groups of four (4) by the self-selection method. Groups of 3 or 5 members may be allowed depending on the student numbers and other circumstances. At the same time, group members should appoint a group leader who is responsible for (a) registering the group on Moodle, (b) communicating with the subject coordinator regarding any issues in relation to group activities and (c) submitting the report to Turnitin by the due date.

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