Financial Statements CW Report Coursework Example | Topics and Well Written Essays - 2250 words

Financial Statements CW Report - Coursework Example hit plc is a celebrated name in the mid-priced dining restaurant industry. The society, since its inception, has flourished by leaps and bounds and has been able to establish a chain of restaurants operating in various towns all across the UK. The caller had been enjoying strengthen pecuniary outlook in the prior years, but due to the increased competition and repercussions of the recession, the management is of the view that the company requires substantial cash in hand in order to reform its ope dimensionnal strategy and further increase its market share. The management plans to refurbish few old restaurants in order to depict new customers and restore its profitability. With the availability of funds, Burke plc would also be able to manage its working capital requirement in the most appropriate manner. The company buttocks hire new workforce, acquire state of the art machine and open up new restaurants in order to enhanc e its market share in the industry. The closest competitor of the company is Hare plc which also holds a substantial market share of the industry. In order to acquire competitive advantage, Burke plc can utilize the funds in countering the forces of competition which are the bargaining power of customer and supplier, threats of new entrants and substitute and the rivalry among the companies. With the sanctioned loan, the company can implement and align Information Systems into its overall corporate strategy, which is likely to give an edge over the other players in the market. In addition, product and service specialization can also be created when a company has substantial pool of funds available. Promotion is considered to be the corner stone in the marketing unite of any organization, and it is an established fact that a company always requires a substantial amount of capital in order to finance the promotional activities. keep company Analysis Ratio analysis is a very accurate and reliable tool when it comes to analyzing the financial outlook of an entity. The primary reason to conduct a ratio analysis is to quantify the results of the operations of a company and compare them with that of the prior year(s) in order to assess different aspects of the financial feasibility. The ratios can be change integrity into various categories such as profitability, gearing and liquidity, each focusing on a different area of the financial outlook of the organization and highlighting the companys performance. These analyses form an integral part of the financial statement analysis, especially from the investors point of view, who always strive to invest in companies having strengthen and stabilizing financial ratios and representing an upward trend. It is of great significance that the ratios must be benchmarked against a standard in order for them to possess a meaning. Keeping that into account, the comparison is usually conducted betwixt companies portraying same b usiness and financial risks, between industries and between different time periods of the same company. The analysis is divided into three main categorize to wit Profitability, Liquidity and Gearing. Profitability ratios identify how efficiently and effectively a company is utilizing its resources and how successful it has been in generating a desired rate of return for its shareholders and investors. Liquidity