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HI5002 Finance for Business Group Assignment T2 2018 XXXXXXXXXX1 HI5002: Finance for Business Trimester 2 2018 Group Assignment Assessment Value: 30% Due Date: Sunday 23:59 pm, Week 10 Group: 2 - 4...

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HI5002 Finance for Business Group Assignment T2 2018
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HI5002: Finance for Business

Trimester 2 2018
Group Assignment
Assessment Value: 30%
Due Date: Sunday 23:59 pm, Week 10
Group: 2 - 4 students
Length: Min 3,000 words
INSTRUCTIONS
Students are required to form a group to study, undertake research, analyse and conduct
academic work within the areas of business finance covered in learning materials Topics
1 to 10 inclusive. The assignment should examine the main issues, including underlying
theories, implement performance measures used and explain the corporate financial
performance. Your group is strongly advised to reference professional websites, journal
articles and text books in this assignment (case study).
Tasks
This assessment task is a written report and analysis of the financial performance of two
selected listed companies on the ASX in order to provide financial and investment advice
to a wealthy investor. This assignment requires your group to undertake a comprehensive
examination of corporate financial performance based on update financial statements of
the chosen companies.
Group A
angement
This assignment must be completed IN Group. Each group can be from 2 to maximum 4
student members. Each group will choose two companies and once the companies has
een chosen, the other group cannot choose the same two companies. First come first
served rule applies here, it means you need to form your group, choose two companies
from the list of ASX and register them with your lecturer as soon as possible. Indicate
your group leader when registering your group with your lecturer for assignment
administration and submission. Once your lecturer registers your chosen companies,
they cannot be chosen by any other group. Your lecturer then will put your group on
Black Board to enable you to interact and discuss on the issues of your group assignment
using Black Board environment. However, face to face meeting, discussion and other
methods of communication are needed to ensure quality of group work. Each group
needs to have your own a
angement so that all the group members will contribute
equally in the group work. If not, a Contribution Statement, which clearly indicated
individual contribution (in terms of percentage) of each member, should be submitted as
a separate item in your assignment. Your individual contribution then will be assessed
ased on contribution statement to avoid any free riders.
HI5002 Finance for Business Group Assignment T2 2018
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Submission
Please make sure that your group member’s name and surname, student ID, subject name,
and code and lecture’s name are written on the cover sheet of the submitted assignment.
When you submit your assignment electronically, please save the file as ‘Group
Assignment- your group name .doc’. You are required to submit the assignment at Group
Assignment Final Submission, which is under Group Assignment and Due Dates on
Black Board.
Submitted work should be your original work showing your creativity. Please ensure the
self-check for plagiarism to be done before final submission in accordance with
SafeAssign Student Guide in Black Board. As a guide, a similarity score of over 30% is
considered as excessive except in the cases where the similarity is caused by the use of
template provided by the lecturer, references or sources of data. Please note that it takes
48 hours for the self-check report to be available for your viewing.
Always keep an electronic copy until you have received the final grade for the Unit. Please
make sure that you submit the co
ect file. Any appeal relating to submitting wrong
files after the deadline will not be considered.
Deadlines
Registration of groups and chosen companies: 5 pm Friday, Week 4
Final Submission of Group Assignment: Midnight (23:59 pm.) Sunday, Week 10
Late submission incurs penalties of 5 (five) % of the assessment value per calendar day
unless an extension and/or special consideration has been granted by the lecturer prior
to the assessment deadline.
BACKGROUND
You’re a group of investment analysts who work for a large investment consulting firm
ased in Australia. There’s one big institutional investor from overseas that is interested
in investing in the Australian market. You’ve been asked to choose two large companies
operating under the same industry in Australia (the industry you think will have the most
promising future for investment) then evaluate and compare them. Finally make a
ecommendation through your Report to the investor which one is more superior
fundamentally.
Create your group’s “business name” under which your group will be providing the
financial advisory services. Choose two listed companies that your group will
investigate/analyse for the purposes of possible recommendation to your client. The group
should obtain all information about the selected companies from this web site:
www.asx.com.au.
Required:
Obtain copies of Financial Statements including Income Statements, Balance Sheets,
and Statement of Changes in Equity, Cash Flows Statements and Notes for three (3)
financial year XXXXXXXXXX, XXXXXXXXXXand XXXXXXXXXXYour group can download these
documents from the suggested web site using the firm’s code (example, BHP- for BHP
http:
www.asx.com.au
http:
www.asx.com.au
http:
www.asx.com.au
http:
www.asx.com.au
HI5002 Finance for Business Group Assignment T2 2018
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Billiton Company, etc.). The assignment should cover the contents described in Part 1 to
7 bellows.
STAGES TO BE COMPLETED

1 Description of operation and comparative advantages of the two chosen companies.
2 Calculation and comparison of performance ratios of the two companies
3 Analysis of monthly share prices movements of the two companies within 3 years
4 Identify any significant factors which may have influenced the share price of your chosen
companies during the time frame.
5 Calculation of Beta values and expected Rates of Return using the CAPM of the two
chosen companies

6 Identify and compare dividend policy of the two chosen companies
7

Letter Recommendation
Final Submission of Complete Assignment on Blackboard
(Week 10)
Details of financial analysis tasks:
1. Description of operation and comparative advantages of the two chosen companies:
Prepare a
ief description of the chosen companies, outlining the core activities, the
market(s) in which they operate within and any factors in the companies’ history which
you consider help present the pictures of your companies. Identify and compare their
comparative advantages.
2 marks
2. Calculation and comparison of performance ratios: using financial data obtained from
cu
ent financial statements of your selected companies for the past 3 years. Annual
eports are accessible via company websites or ASX website. Your client is strongly
interested in the three groups of ratios:
- Liquidity ratios;
- Profitability ratios
- Capital structure (leverage) ratios
You need to provide charts and/or tables for analysis and justification.
6 marks
HI5002 Finance for Business Group Assignment T2 2018
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3. Analysis of monthly share prices movements: Using the information from the ASX
website, complete the following tasks:
- Prepare graphs for movements in the monthly share price over the last three years for
the companies that you are investigating. Plot them against movements in the All
Ordinaries Index.
2 marks
- Write a report which compares movements in the two selected companies’ share
prices to each other and to the All Ords Index. For instance, how are the prices of the
two selected moving? In the same trend or diverse trends? How closely are they
co
elated with the All Ords Index. Above or below? More or less volatile?
2 marks
4. Significant factors which may have influenced the share price: Research via the
internet or financial
usiness publications:
From research via the internet (using credible sources) or financial
usiness publications,
identify at least 2 significant announcements which may have influenced the share price
of your selected companies within 3 years. These factors could include merger or
acquisitions, positive or negative earnings forecasts, unusual
Answered Same Day Sep 16, 2020 HI5002

Solution

Nikita answered on Sep 19 2020
142 Votes
Corporate Finance
Corporate Finance    
Table of Contents Page No.
1.Introduction………………………………………………………………….3-4
2.Ratio Analysis…………………………………………………………………4-8
3.Monthly share price movements……………………………………………..8-10
4.Significant factor influencing the share price………………………………10-11
5.Beta value calculation and expected rate of return…………………………..12
6.Dividened Policy……………………………………………………………13
7.Recommendation…………………………………………………………..13
8.References…………………………………………………………………..14
1. Introduction
A Gold Mining Company is Newcrest Mining Limited which is a public listed company. In exploration, development of mine, operations of mine, and the gold sale and concentrate of gold/silver. A portfolio of mines is owned and operated and
own field pipeline and exploration projects of Greenfield.Cadia,Australia,Australia,Telfer,Lihir,Indonesia,Bonikro,Papua New Guinea and exploration and other, the company has its operating segments. In Australia, Indonesia, Papua New Guinea, and West Africa and in Cote d’Ivorie the mines are located. The operation of caddie Valley is approximately located 30 kilometers from the orange city in New South Wales of Central West and is over 250 kilometers Sydney west (Reuters, 2018).The Operation of Lihir in the New Zealand Province is on Niolam island of Papua New Guinea. The Telfer gold-mines of copper are located in the East Pilbara region in the Great Sandy Desert. In the Morobe province the hidden valley is located in Papua New Guinea.
Amcor limited is a public listed Company and the company belongs to material industry. Packaging solutions in Western Europe, Australia, North America, New Zealand and internationally is provided by Amcor Limited. Through Rigid plastics of Amcor, flexible of Amcor and segments of other investments it is operated. Rigid Plastic Containers is manufactured by the Company for beverage and food products range, including soft-drinks which is ca
onated, sports drink, water, juices, beverages which are milk-based, dressings, sauces, spirits and beers, spreads and items of personal care and for various applications plastic caps (Bloomberg, 2018). Flexible and film packaging is also manufactured for the industry of food and beverage, including confectionary, dairy coffee, and fresh food, and pet packaging of food; and medical and pharmaceutical, produce which are fresh and segments of snack food. In addition, flexible packaging is also provided by the company for folding cartons which are specialist for packaging of tobacco and other industries; and solutions of packaging for care products of home and personal. In 1926 the company was incorporated and in Southbank, Australia the Company has its headquartered.
2. Ratio Analysis
a) Liquidity Ratio
The ratio of liquidity helps in analyzing the company ability to pay off both its liabilities that are cu
ent as they become due as well as the liabilities which are long-term when they become cu
ent. In other way, these ratios represent the company cash-level and other assets ability to turn into cash for paying off the liabilities and other obligations which are cu
ent.
1) Cu
ent Ratio: The cu
ent ratio represents the cu
ent assets to cu
ent liabilities ratio. For measuring the liquidity it is the most common ration which is used. The cu
ent ratio of the company determines whether the company has enough assets which are short-term to pay for the liabilities which are short-term.
Cash and other resources are considered as cu
ent assets that can be converted in the short-run in to cash. Cu
ent liabilities are treated as obligations which are required to be settled within a period of one year or the operating cycle which is normal. Higher cu
ent ratio is more favorable for the company.
Cu
ent Ratio =Cu
ent Assets/Cu
ent Liabilities
Newcrest Mining Limited Figure in Us $ (Millions)
Cu
ent Ratio (2017) = 1249/664 = 1.88
Cu
ent Ratio (2016) = 803/670 = 1.19
Cu
ent Ratio (2015) = 1063/509 = 2.09
Amcor Limited Figure in Us $(Millions)
Cu
ent ratio (2017) = 3286.5/4012.4 = 0.82
Cu
ent Ratio (2016) = 3193.1/3645.2 = 0.88
Cu
ent Ratio (2015) = 3413.0/3674.4 = 0.93
Newcrest Mining limited is performing better than Amcor limited as the cu
ent ratio of the company Newcrest mining is more than Amcor limited by 1.88-0.82 that is 1.06 in the year 2017.
2) Quick Ratio: The acid test ratio or quick ratio is a liquidity ratio that measures the company ability for the payment of its liabilities that are cu
ent when they come due with only quick assets. Quick assets are treated as cu
ent assets which are converted into cash on short period of time or 90 days.
For companies higher quick ratio are more favorable because it represent that there are more assets which are quick than cu
ent liabilities. The liquidity of the company increases with the increase in the ratio. If needed more assets will be converted into cash. For investors, there is a good sign, but for the creditors it is even better as they are willing to know whether they get their payment on time.
Newcrest Mining limited Figure in Us $(Millions)
Quick Ratio (2017) = 1249-556/664 = 1.04
Quick Ratio (2016) = 803-545/670 = 0.39
Quick Ratio (2015) = 1063-619/509 = 0.87
Amcor Limited Figure in Us $(Millions)
Quick Ratio (2017) = 3286.5-1305.5/4012.4 = 0.49
Quick Ratio (2016) = 3193.1-1244.4/3645.2 = 0.53
Quick Ratio (2015) = 3143.0-1213.9/3674.4 = 0.52
Newcrest mining limited is performing better than Amcor limited by 1.04-0.49 that is 0.55 for the financial year 2017 .
) Profitability Ratio: This ratio compares statement of income accounts and...
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