BIZ201_Assessment 3 Brief_M3_Case Study Page 1 of 10 ASSESSMENT BRIEF Subject Code and Title BIZ201 Accounting for Decision Making Assessment Case Study Part A Individual/Group Individual Length 1,500 words Learning Outcomes b) Apply relevant accounting concepts to simple business scenarios. c) Interpret and analyse the information contained in general purpose financial statements, to evaluate the overall financial position and performance of a business. Submission By 11:55 pm AEST/AEDT Sunday of Module 4 (week 8) Weighting 30% Total Marks 100 marks Context: This assessment is aimed at consolidating knowledge from Modules 1-3. By prescribing this assessment, you are able to reflect on your understanding of accounting concepts and be able to apply them to business scenarios like given in this case study. Instructions: 1. This assignment must be prepared and submitted individually, the work you submit must be your own. 2. Two files have to be submitted, Excel Worksheet together with the Business Report. 3. You should include a reference list for any textbooks, websites or other references you use to prepare your answers. Apart from the reference list at the end of the report, use in text referencing whenever appropriate. 4. For all questions you are required to show all workings. When calculating in Excel, appropriate Excel formulas will need to be shown. Copy pasted numbers with no workings provided are not acceptable. 5. Unless otherwise instructed, round your numerical answers to two decimal places. 6. Submit your assessment files using the following naming convention: First Name_Last Name_BIZ201_Case_Study A_Assessment3_Workbook.xlsx First Name_Last Name_BIZ201_Case_Study A_Assessment3_Report.doc BIZ201_Assessment 3 Brief_M3_Case Study Page 2 of 10 Crystal Hotel Pty Ltd is a privately owned 3.5 stars hotel located in Paramatta CBD in Sydney. The Hotel consists of 160 rooms with maximum capacity of 350 guests, a restaurant with capacity of 150 guests, a function room with maximum capacity of 250 guests and a conference room with maximum capacity of 200 guests. The average price per room per night is $148. While the hotel is located in a very popular location and close proximity to the Brisbane River and the city centre, it is becoming quite out-dated. The owners rely heavily on their corporate clientele. Clients usually use the hotel for their expat employees. Due to long term contracts they pay on credit with invoices being issued at the end of each month. The hotel is often faced with outstanding invoices. The owners have so far tolerated it as it usually occurs with their long term clients. Additionally to the accommodation services, they often use hotel facilities for their functions and conferences. The hotel is constantly having difficulties retaining a good quality staff as they always get junior personnel, which once gaining experience will usually leave for better opportunities in hotels with higher ratings. The biggest issue is to retain high quality personnel in the hotel restaurant, especially a chef. The owners would like to increase the hotel star rating by renovating or refurbishing the hotel and improving their services. They are thinking about building a Wellness Centre on the rooftop of the hotel, which would include a massage treatment room, gym, spa, sauna and an outdoor pool. As new plans will require quite extensive capital investment, the owners would like to know where they stand financially before making any major decisions. You have been appointed to analyse their financial statements and to give them an insight on which areas should be improved and analysed further. You are expected to conduct the financial statement analysis in Excel and then use your findings in creating a business report to be submitted to the client. Crystal Hotel Case Study BIZ201_Assessment 3 Brief_M3_Case Study Page 3 of 10 REQUIRED: PART 1 – to be done in Excel 1. Vertical analysis of financial statements: a. Conduct Vertical Analysis of the Crystal Hotel Balance Sheet using the Case Study Excel Workbook. The workbook is attached under Assessment Information section (AU - Crystal Hotel Case Study Workbook Part A student.xlsx). Open the Vertical Analysis Balance Sheet worksheet. b. Conduct Vertical Analysis of the Crystal Hotel Income Statement for the year ending 30 June 2015 using – Vertical Analysis Income Statement worksheet of the same workbook (AU - Crystal Hotel Case Study Workbook Part A student.xlsx). 2. Conduct Ratio Analysis using Ratio Analysis worksheet of the same workbook (AU - Crystal Hotel Case Study Workbook Part A student.xlsx). PART 2 – to be included in the Business report 3. Using the Income Statement Vertical Analysis prepared in Excel, conduct Income Statement comparative analysis to the industry benchmarks included in Table 1 and Table 2 of the Appendix. Comment on how the business is performing comparing to the industry. Include comments on Revenue, Cost of sales (excluding personnel costs), Personnel costs, unallocated Operating Costs and Total Costs proportions. Based on the results of your comparative analysis make recommendations on areas needing an improvement or further investigation. 4. Using the results of the Ratio Analysis in Excel, comment on Profitability, Efficiency, Liquidity and Solvency of the business. With reference to the industry data provided, make recommendations when appropriate. 5. There are additional industry specific performance indicators and benchmarks that the hotel could use when comparing itself to the industry. Conduct a research and recommend 3 additional industry specific benchmarks the hotel could use in their comparative analysis. Include a brief explanation of each benchmark you are recommending including formulas when appropriate. BIZ201_Assessment 3 Brief_M3_Case Study Page 4 of 10 Appendix – Industry Data Table 1 Profit and Loss per Number of Rooms BIZ201_Assessment 3 Brief_M3_Case Study Page 5 of 10 Table 2 Profit and Loss based on average Room Price Range BIZ201_Assessment3 Brief_M3_Case Study Page 6 of 10 Learning Rubric: Assessment 3 Assessment Attributes Fail (Unacceptable XXXXXXXXXXPass (Functional XXXXXXXXXXCredit (Proficient XXXXXXXXXXDistinction (Advanced XXXXXXXXXXHigh Distinction (Exceptional XXXXXXXXXXGrade Description (Grading Scheme) Fail grade will be awarded if a student is unable to demonstrate satisfactory academic performance in the subject or has failed to complete required assessment points in accordance with the subject’s required assessment points. Pass is awarded for work showing a satisfactory achievement of all learning outcomes and an adequate understanding of theory and application of skills. A consistent academic referencing system is used and sources are appropriately acknowledged. Credit is awarded for work showing a more than satisfactory achievement of all learning outcomes and a more than adequate understanding of theory and application of skills. A consistent academic referencing system is used and sources are appropriately acknowledged. Distinction is awarded for work of superior quality in achieving all learning outcomes and a superior integration and understanding of theory and application of skills. Evidence of in-depth research, reading, analysis and evaluation is demonstrated. A consistent academic referencing system is used and sources are appropriately acknowledged. High Distinction is awarded for work of outstanding quality in achieving all learning outcomes together with outstanding integration and understanding of theory and application of skills. Evidence of in‐ depth research, reading, analysis, original and creative thought is demonstrated. A consistent academic referencing system is used and sources are appropriately acknowledged. Application of Vertical analysis of financial statements SLO Addressed: c) Interpret and analyse the information contained in general purpose Demonstrates no application of vertical analysis of Balance Sheet and Income Statement. Excel formulas are not used for calculation. Demonstrates limited application of vertical analysis of Balance Sheet and Income Statement. Few correct Excel formulas are used for calculation. Demonstrates consistent application of vertical analysis of Balance Sheet and Income Statement. Not all Excel formulas used for calculation are correct. Demonstrates an advanced application of vertical analysis of Balance Sheet and Income Statement. Most Excel formulas used for calculation are correct. Consistently demonstrates an advanced application of vertical analysis of Balance Sheet and Income Statement. All Excel formulas used for calculation are correct. BIZ201_Assessment3 Brief_M3_Case Study Page 7 of 10 financial statements, to evaluate the overall financial position and performance of a business. 22% Calculation of appropriate financial ratios SLO Addressed: c) Interpret and analyse the information contained in general purpose financial statements, to evaluate the overall financial position and performance of a business. 16% Demonstrates no evidence of use excel formulas and relevant worksheets to calculate appropriate ratios. Demonstrates limited evidence of use excel formulas and relevant worksheets to calculate appropriate ratios. Demonstrates consistent evidence of use excel formulas and relevant worksheets to calculate appropriate ratios. Demonstrates an advanced evidence of use excel formulas and relevant worksheets to calculate appropriate ratios. Consistently demonstrates an advanced evidence of use excel formulas and relevant worksheets to calculate appropriate ratios. Comparison of Vertical analysis of financial statements calculations No understanding of use Vertical Analysis of financial statements Limited understanding of use Vertical Analysis of financial statements Demonstrates consistent understanding of use Vertical Analysis of financial Well demonstrated understanding of use Vertical Analysis of financial Excellent demonstrated understanding of use Vertical Analysis of financial BIZ201_Assessment3 Brief_M3_Case Study Page 8 of 10 with industry values including comments on various types of costs SLO addressed: b) Apply relevant accounting concepts to simple business scenarios. c) Interpret and analyse the information contained in general purpose financial statements, to evaluate the overall financial position and performance of a business. 23% calculations prepared in Excel for comparison to industry values provided in the Appendix. No comments on Revenue, Cost of Sales, Personnel Costs, Unallocated Operating Costs and Total Costs proportions. calculations prepared in Excel for comparison to industry values provided in the Appendix. Limited comments on Revenue, Cost of Sales, Personnel Costs, Unallocated Operating Costs and Total Costs proportions. statements calculations prepared in Excel for comparison to industry values provided in the Appendix. Some comments on Revenue, Cost of Sales, Personnel Costs, Unallocated Operating Costs and Total Costs proportions. statements calculations prepared in Excel for comparison to industry values provided in the Appendix. Good comments on Revenue, Cost of Sales, Personnel Costs, Unallocated Operating Costs and Total Costs proportions. statements calculations prepared in Excel for comparison to industry values provided in the Appendix. Well commented on Revenue, Cost of Sales, Personnel Costs, Unallocated Operating Costs and Total Costs proportions. Understanding of Profitability, Efficiency, Liquidity and Solvency of the business using ratio analysis with reference to industry data No use of ratio analysis to demonstrate the understanding of Profitability, Efficiency, Liquidity and Solvency of the business. No reference to industry data is provided. Limited use of ratio analysis to demonstrate the understanding of Profitability, Efficiency, Liquidity and Solvency of the business. Limited comments were made with Well-developed use of ratio analysis to demonstrate the understanding of Profitability, Efficiency, Liquidity and Solvency of the business. Some comments are made with reference to industry data provided. Thoroughly developed understanding of Profitability, Efficiency, Liquidity and Solvency of the business by using ratio analysis. Good comments were made with reference to industry data provided. Highly developed understanding of Profitability, Efficiency, Liquidity and Solvency of the business by using ratio analysis. Recommendations are clearly justified based BIZ201_Assessment3 Brief_M3_Case Study Page 9 of 10 SLO addressed: b) Apply relevant accounting concepts to simple business scenarios. c) Interpret and analyse the information contained in general purpose financial statements, to evaluate the overall financial position and performance of a business. 23% reference to industry data provided. on reference to industry data provided. Application of own research to further develop comparative analysis of hotel SLO addressed: b) Apply relevant accounting concepts to simple business scenarios. No evidence of own research to provide examples of three industry specific benchmarks the hotel could use for further comparative analysis. No explanation of any benchmark including formulas is provided. Limited evidence of own research to provide examples of three industry specific benchmarks the hotel could use for further comparative analysis. Limited explanation of any benchmark including formulas is provided. Consistent evidence of own research to provide examples of three industry specific benchmarks the hotel could use for further comparative analysis. Consistent explanation of each benchmark including formulas is provided. Demonstrates an advanced evidence of own research to provide examples of three industry specific benchmarks the hotel could use for further comparative analysis. Well-developed explanation of each benchmark including formulas is provided. Highly sophisticated evidence of own research to provide examples of three industry specific benchmarks the hotel could use for further comparative analysis. Thoroughly developed explanation of each benchmark including formulas is provided. BIZ201_Assessment3 Brief_M3_Case Study Page 10 of 10 c) Interpret and analyse the information contained in general purpose financial statements, to evaluate the overall financial position and performance of a business. 10% Correct citation of key resources and evidence Overall structure, appearance and referencing of the report are assessed 6% Demonstrates inconsistent use of good quality, credible and relevant resources to support and develop ideas. Demonstrates use of credible and relevant resources to support and develop ideas, but these are not always explicit or well developed. Demonstrates use of high quality, credible and relevant resources to support and develop ideas. Demonstrates use of good quality, credible and relevant resources to support and develop arguments and statements. Shows evidence of wide scope within the organisation for sourcing evidence. Demonstrates use of highquality, credible and relevant resources to support and develop arguments and position statements. Shows evidence of wide scope within and without the organisation for sourcing evidence.