Discuss financial management and control
Discuss financial management and control
Part A – BioSec Plc
You are a financial analyst at BioSec Plc; a public limited company specialising in manufacturing and distributing medical equipment. The
Board of Directors have looked into the financial statements of the company for the last two years and have raised concerns regarding both the
company’s profitability and liquidity. The financial statements of BioSec for the last two years are given below(Attached)
Required:
- Prepare a report for the Board of BioSec Plc. that evaluates the performance of BioSec Plc in relation to profitability, gross and net profit,
liquidity, gearing, asset utilisation, P/E and investor potential. Your report must be supported by the calculation of relevant ratios in the
evaluation areas mentioned above. - Critically evaluate the limitations of using ratio analysis for both cross-sectional and time-series comparisons.
All calculations should be clearly shown including all appropriate workings, and should be made to the nearest £000 where
required.
Part B
- Explain the importance of budget, and drawback of budget, as well as analysis of variances, with suggestions for investigation and management action.
- Critically evaluate the benefits of producing accurate and timely financial information for decision making and control purpose.
Part C
- Managers can fund potential investments and expands business operation through accessing a range of differing sources of finance.
Explain and critically evaluate sources of both internal and external finance that could be used by companies to finance further
investment programmes, including pros and cons of each alternative.
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