Financial and Business Evaluation over a 3year Period

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Analysis Of Business And Financial Performance Over a Three Year Period Of: Dera Ghazi Khan Cement Limited (Dgkcl) OXFORD BROOKES UNIVERSITY
BS (Hons) Applied Accounting
Research and Analysis Project
Research Report
Analysis of business and financial performance over a three year period of: DERA GHAZI KHAN CEMENT LIMITED
(DGKCL)
Student Name: KHAWAJA DANYAL TARIQ
Registration Number: 1760726
OCTOBER 2011
Word count: 6,499
Table of Contents
| |TOPIC |PAGE# |
| | | |
|1. |Project objectives and overall research approach | |
| |1.1 Reasons for selecting topic and company |3. |
| |1.2 Project objectives and research questions |3. |
| |1.3 Research approach |4. |
| | | |
|2. |Information gathered and business techniques used | |
| |2.1 Sources of information |5. |
| |2.2 Description of method used to gather information |5. | | |2.3 Limitations of information |6. |
| |2.4 Ethical issues |6. |
| |2.5 Business techniques used and their limitations |7. |
| | | |
|3. |Analysis and conclusion | |
| |3.1 Cement sector analysis |9. |
| |3.2 Company profile |9. |
| |3.3 Ratio analysis |10. |
| |3.4 Porter’s five force analysis |17. |
| |3.5 SWOT analysis |18. |
| |3.6 Conclusion and recommendations |20. |
| | | |
|Appendix A: |Bibliography and referencing |22. |
|Appendix B: |Sample questionnaire and its response |24. |
|Appendix C: |Ratios sheet |26. |
|Appendix D: |Balance sheet and Income statement |27 |
|Appendix E: |Graph |31. |
|Appendix F: |Graph |32. |
|Appendix G: |Graph |33. |
1. PROJECT OBJECTIVES AND OVERALL RESEARCH APPROACH
1.1 REASONS FOR SELECTING TOPIC AND COMPANY
I chose analysis of business and financial performance as it is relevant to a major portion of my studies and I wanted to apply the knowledge which I had gained throughout my ACCA study days in real life context. Moreover, this topic is easily understandable compared to the rest of others. Information about it is relatively easily assessable and Dera Ghazi Khan Cement (DGKCL), being a public limited company with a high turnover and also provided with an extensive infrastructure consisting of relevant, accurate, reliable and up-to-date information. Analyzing the financial situation, performance measurement and environmental analysis is an integral part of the syllabus for the ACCA professional examinations, and various papers covered this topic comprehensively. I have studied all these papers and I thought it would be a good chance to apply the concepts, which I have learned theoretically. Another reason for this particular topic is that the cement sector has the distinction of being a very important economic sector of Pakistan, logical, as its raw material is abundantly available in the country. In addition to all the above, I was encouraged by my uncle to choose this topic as he is an active investor in Karachi Stock Exchange and he understands the importance of financial analytical skills. 1.2 PROJECT OBJECTIVES AND RESEARCH QUESTIONS

Each type of analysis has a purpose or use that determines the different relationships emphasized in that analysis. (Brigham, 1979) The aims and objectives of this research report are as follows: ❖ To analyze the cement sector performance

❖ To have an overview of DGKCL’s history and business profile ❖ To analyze the DGKCL’s financial position in terms of: ❖ Profitability to assess a firm’s ability to create economic value in excess of value expended, to grow, remain solvent and repay debt. (McKinley, 1984) ❖ Liquidity to measure the short-term financial health of the organization; to assess the ability of the firm to pay its short-term debts. (Stimpson, 2002) ❖ Debt and capital structure to measure the financial risk in company’s long-term capital structure. (FTC, 2008) ❖ Investment ratios to assess the value and quality of investment in the ordinary shares of a company and the prospects of financial gain. (BPP, 2009) ❖ SWOT analysis is to conduct a general and quick examination of a...
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