Analysis of a Financial Performance of an Organization

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Analysis of a Financial Performance of an Organization|
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Table of Contents

Executive Summary....................................................................................................4

Introduction................................................................................................................5

Company Background...............................................................................................5

Financial Report Analysis..........................................................................................6

Tesco Plc’s Ratio Analysis (2005 – 2007)…………………………………………….…8

Financial Statement Analysis of Tesco Plc, Marks & Spencer Plc and Sainsbury Plc.’s…………………………………………………………………….……………………15

Conclusion………………………………………………………………………………….18 Reference………………………………………….……………………………………......19 Appendix……………………….……………………………………………………………20

Executive Summary:

The main aim of this report is to critically analyse the financial performance of an organisation that has published financial accounts for past three years. The report also has to gather financial statements of another two organisations within the same industry to make comparison with the primary organisation. After analysing the financial statement and financial ratios of these three companies it would help to find out the primary company’s previous and current situation and would also help forecasting the future of the organisation. The evaluation of this report would also assist to discover whether the primary organisation has potential risk involved that needs to be taken into account for consideration and to take necessary step. Tesco Plc being the market leader in super market chain shops has been considered as the primary company. Marks & Spencer Plc and Sainsbury Plc are chosen as the secondary companies. All these companies are a part of very dynamic industry of super market stores. The industry which is constantly changing and are also subjected to direct changes in consumer buying behaviour. The report will also try to give a brief picture of how the super market chains perform and the future trend of this industry. This report will help to draw conclusion on the primary company’s past performance, current state and future trend.

Introduction:
The main purpose of this report is to give a critical analysis of the financial performance of an organization, which in this case is Tesco. This report will evaluate and highlight the financial trend of a company in a particular industry. The report will further look into the various financial ratios of the company to conclude its findings. By doing the analysis one can indentify a company’s financial strengths and weakness over a certain period of time. The company chosen for the financial review is Tesco Plc, and for the comparison Marks & Spencer Plc and Sainsbury Plc’s financial data has been taken into consideration. Being the current leader in super market chain Tesco Plc has been chosen as the main organization for the report. The main financial data have been taken from all the three companies are based on Profit and Loss Account (Income Statement), Balance Sheet, Cash Flow Statement and operating review. To evaluate the current market position and market trend, financial reports for 2005, 2006 and 2007 were taken from all the three companies. In order to further enhance Tesco’s financial state in the market financial statements of Marks & Spencer’s and Sainsbury’s were also evaluated. This report will also look at the trend between these periods and forecast the companies’ position for the future. After analyzing the report it would be easier to understand companies lacking, strength and areas to pay attention where needed. Company Background Information:

Tesco Plc

Tesco is the supermarket leader in the UK for last few years. Tesco was founded by Jack Cohen in 1919. He started the business by selling surplus groceries from a stall in the...
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