Financial Structure Analysis

Assignment Tasks The assignment task is a written report and analysis of your chosen financial institution and the financial environment. You will be required to apply the financial concepts you have learned in class to your chosen industry and company. In groups of 3-4, students should first choose one ASX listed company to undertake financial ratio, market and competitor analysis. Finally, identify the regulator of the industry and your chosen ASX Listed Company and the recent actions (within the last 3 years) that they have taken to control ethical behaviour in the industry. Note that groups cannot have the same ASX Listed Company. The first-come, first-served rule will apply. Assignment Structure should be as the following:

Requirement/s and Guide

Questions 1 Industry Description (4marks, up to 400 words) a)Discuss the size of the industry and the level of competition. b)Identify the regulator/s of the industry. Comment on the extent of the regulator’s power to ensure compliance within the industry.

2 Company Description (6marks, up to 600 words) a)What is/are the main source of business (the main source of revenue)? b)What is the ownership structure of your company?

3 Financial Instrument Analysis (6 marks, up to 600 words) a)Secure a copy of the 2019 or 2020 Balance Sheet and Income Statements of your chosen firm and attach it as an exhibit or table in your appendix. b)What are the financial instruments that your firm deals in? Check Assets, Liabilities and Equities section. Also read through the Notes to Financial Statements to get a better description of the financial instruments. c)Evaluate the cash or liquidity situation of the company and provide your opinion based on the liquidity ratios

4 Financial Structure Analysis (10 marks, up to 1000 words) Suppose your chosen company requires AUD 10 Million to finance a new project and your finance managers are evaluating whether to borrow or issue new shares. a)Identify 2 key financial ratios that will be important to creditors. b)Identify 2 key financial ratios that will be important to shareholders. c)Calculate the 4 financial ratios (above) based on the financial statements you have attached. d)Based purely on Financial Ratios, recommend whether it is better for the company to borrow the AUD 10 Million or issue AUD 10 Million new shares.

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5 Financial Market Analysis (8marks, up to 600 words) a)Conduct further research on your chosen company and explain the governance environment of the company.Has it been involved in any unethical practices in the past? How did the regulators and investors react? What corrective actions were taken by the company? If there has been no reported incidence of unethical behaviour, comment on your chosen company’s strategies that ensure compliance with the law.

6 Findings, Conclusion and Recommendations (4marks, up to 400 words) Based on a summary of your findings, conclude whether the financial market for your chosen industry is healthy

7 Presentation of Paper (including Assignment Cover Page and Reference List) –2 marks and not included in word count

ASX listed companies as at Wed Apr 03 14:07:09 AEDT 2019
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