An Analysis of Financial and Business Performance of Indus Motor Company Limited

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Oxford Brookes University
Research and Analysis Report

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An analysis of financial and business performance of

Indus Motor Company Limited

Prepared by: Murtaza Yunus Marvi (1270201)
Dated: 26 Sep 2008
Word Count: 6496
Table of Contents

CONTENTS PAGE NUMBERS

PART 1: Project objectives and overall research approach

Reason for choosing the topic1
Reasons for choosing the company1
Automobile Industry in Pakistan1
The Company2
Objectives of the Project3
Research Questions3
Overall research approach3

PART 2: Information gathering and accounting / business techniques

Information Gathering4

Sources of information:-4
Texts4
Articles4
Reports4
The Internet4
Other sources:5

Limitations of information gathering:5

Description of Accounting and Business Techniques6

Value Chain Analysis6
Introduction6
Limitations7

SWOT Analysis7
Introduction7
Limitations7

PEST Analysis8
Introduction8
Limitations8

Ratio Analysis8
Introduction8
Limitations9

PART 3 : Results, analysis, conclusions and recommendations

Business Analysis10-15

Value Chain Analysis:-10
Firm Infrastructure10
Human Resource Management10
Technology Development11
Inbound Logistics11
Operations11
Marketing & Sales12
Service12

SWOT Analysis13
Strengths13
Weakness13
Opportunity14
Threats14

PEST Analysis14
Political Environment14
Economical Environment15
Socio Cultural Environment15
Technological Environment15

Financial Analysis16-22

Vertical or Trend Analysis16

Profitability Ratios16
Return on Capital Employed16
Gross Profit Margin17
Net Operating Profit Margin17
Total Asset Turnover18

Liquidity Ratios18
Current Ratio18
Quick Ratio19

Efficiency (Turnover Ratios)19
Inventory turnover (in days)19
Average Collection Period (in days)20
Accounts payable payment period (in days)20

Long-Term Solvency Ratios21
Debt Ratio21
Interest Cover ratio21
Shareholders Investment Ratios22
Earning per share (EPS)22
Dividend Cover22

Horizontal Analysis23
Profitability ratios23
Liquidity ratios24
Efficiency Ratios24
Long-term solvency ratios24
Shareholder investment ratios24

Conclusion25

List of References26-27

Bibliography28-29

Appendices

Appendix 1: Balance Sheet30
Appendix 2: Profit & Loss31
Appendix 3: Ratio Definitions32
Appendix 4: Ratios33
Appendix 5: Ratio Calculations showing Excel Formulas34

Skills and Learning Statement………………………………………………… ….35-43

What did you learn from the meetings with your Project Mentor, including the presentation that you gave to your Project Mentor?36-41

How well do you think that you have answered your research question(s)41

How have you demonstrated your interpersonal and communication skills during the project work?42

How has undertaking the RAP helped you in your accountancy studies and/or current employment role?42-43 Introduction

Reason for choosing the topic

The topic chosen for this Research and Analysis Report is “The business and financial performance of an organisation over a three year period”.

There are several factors which motivated me in choosing this topic; factors varying from professional outlook to personal interest. The topic is of great interest to me due to the reason that I am more inclined towards those subject areas that require analytical and numerical intelligence. As the topic is covered extensively in the ACCA syllabi, choosing this topic will help me in utilising and demonstrating the knowledge acquired during...
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