University of South Wales

Strategic Financial Management (AF4S31-V2)

Module Assessment 1

Tutor: Angelos Arkoulis

Student: Chioma Edna Ezechukwu
(3379447)

October 2020

Student ID: 3379447

Abstract

This report comprises of two main parts whose objectives are to respectively analyze the key
Tesco stakeholders and the financial position of Benedict Co. in the first part the author will
use Tesco annual report 2016 to identify and analyze its key stakeholders who are customers,
suppliers and employees , focusing on how the company’s Environmental and Social Review
and the Corporate Governance Report help Tesco demonstrate its performance in terms of its
corporate and social responsibilities to two of its stakeholders. Although there are many other
stakeholders that are affected by corporate decisions or serve as link between financial and
non-financial objectives, the report concluded that these two stakeholders play a very
significant role in helping the company measure the performance of both of its financial and
non-financial objectives.
On the other hand, Benedict Co.’s financial position has been evaluated using a number of
financial statements/ratios. In this regard, the report has revealed a company that is financially
weak within the period under revew.

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CONTENT

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CHAPTER I: INTRODUCTION
In an ever evolving business world, it is essential that management of organizations recognize
what their company requires as their operations grows. Since the support of their stakeholders
is essential, what are the best practices to attract and retain existing and potential stakeholders
in their business. Also, what financial tools are required to analyze how the business is
growing?. All these answers are contained in Strategic Financial Management. This essay will
attempt to answer the highlighted questions by strategically and financially evaluating two
companies: Tesco PLC and Benedict Co.
Tesco PLC is world’s third largest, British international grocery and general merchandising
retail chain with operations in 14 countries. It is the largest British retailer by both global sales
and domestic market share, with profits exceeding £3 billion, and the third largest global
retailer based on revenue, behind Wal-Mart and Carrefour. (Tesco, 2009).
On the other hand, Benedict Co, according their website is an American company which can
be described as one of the biggest and most experienced professional, experienced buyer and
reseller of damaged cargo, abandoned freight, casualty losses and more. (Benedict Co.,
2018).
This essay will examine Tesco’s 2016 annual reports to identify the three key stakeholders of
the company. It will also analyze the company’s Environmental, Social Review and the
Corporate Governance Report to reveal how its social and corporate responsibilities are
deployed to any two of the earlier identified stakeholders.
The report also seeks to analyze and evaluate the financial condition of Benedict Co. using a
range of financial ratios to ascertain if it meets the requirements of its potential customers,
investors, lenders and suppliers. The report will also cover the purpose and relevance of the
selected ratios within a given period of time, the results for each chosen ratio and reasons for
any movement. In addition, while highlighting vital aspects of the performance of Benedict Co.,
the report will also evaluate the application of these financial ratios in interpreting and
measuring the performance of the company within the period under review.
This study will be useful to existing companies, startups, and future investors in the business
world as it will emphasis that stakeholders are just as important to organisations as
shareholders. The stakeholder view does not alter the goal of maximizing shareholder’s wealth

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instead it is considered as part of the organisation’s “social responsibility”. This essay will
expose some actions and projects that successful organisations are using to delight their
stakeholders. It will also apply a range of financial ratios that are vital in measuring a
company’s financial performance within a specific period of time.

CHAPTER 1: TESCO’S STAKEHOLDERS

Although maximization of shareholder wealth is the primary goal, many firms like Tesco PLC
have broaden their focus to include the interest of stakeholders as well as shareholders.
A review of Tesco’s 2016 annual report reveals that as the company strives to achieve their
long- term strategy of becoming the market leader brand in their industry, they are focused on
maintaining and restoring good rapport and trust with their stakeholders. (Tesco 2016)
Who are stakeholders? According to Clarkson (1995), stakeholders are “persons or groups
that have, or claim, ownership, rights, or interests in a corporation and its activities, past,
present, or future”. Also, Thomson, Wartic and Smith (1991) defines stakeholders as groups
“in relationship with an organisation.” Adding that they can affect or be affected by the
organization’s action, objectives or policies. Stakeholders, in a broader sense, are customers,
creditors, employees, government agencies, shareholders, creditors, owners who have a direct
economic connection to the firm etc. In addition, Alkhafaji (1989) buttresses that stakeholders
are groups to whom the corporation is accountable”.
Just as most organisations are accountable to their shareholders, they are also in the same
vein, accountable to their stakeholders. This is because stakeholders are largely endowed with
the powers and abilities to influence choices and decisions which affect an organization.
Furthermore, a broader definition of stakeholder is: “…any group or individual who can affect
or is affected by the achievement of an organization’s objectives.” (Freeman, 1984 pp46;
Freeman and Reed 1983 pp93). In summary, stakeholders are people, firms, organizations,
entities or simply the entire community that can affect or be affected by the company’s
activities.
Most companies have different stakeholders such as customers, suppliers, employees,
investors, shareholders, etc. These stakeholders can be summarised into two major groups:
• Internal stakeholders: employees & colleagues

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• External stakeholders: customers, government, suppliers, and communities (Tesco 2016)
In narrowing this down to Tesco, their 2016 annual report mentions their three main
stakeholders - customers, suppliers and colleagues (Tesco, 2016, p.13).
Tesco Customers are referred to as individuals or bodies who patronize their
product/services, use their products regularly or refer them to other shoppers. This group
belongs to the company’s external stakeholders and their customer’s loyalty is defined by the
frequency of shopping, loyalty to their brand and how much they spend on Tesco’s products.
Customers want to know about the various products produced by the company, the best
discount options available, information about after sales services and to decide whether to
continue to patronize Tesco or not.
Suppliers are Tesco’s stakeholders that supplies goods and services to them. These are part
of the supply chain of the business and actually provides the bulk of the value offered by the
company.
Colleagues are referred to by the company as Tesco’s employees, in whom the company
invests in order to better serve its customers. Employees (staff) are the power house of the
organization. Under the direction of the management, they execute their individual
responsibilities in the organization.

How the Environmental and Social Review and the Corporate Governance Report help
Tesco demonstrate its Performance to two of its stakeholders - Customers and
Suppliers
The Environmental and Social Review and Corporate Governance reports reveals how Tesco
PLC has performed in terms of its Corporate Social Responsibilities (CSR) to its stakeholders.
This report will discuss only two out of the three key stakeholders - the customers and
suppliers, for the purpose of this exercise.
According to the CEO’s statement, he mentioned that the company would retain the same
strategy for success endorsed since October 2014. They are to regain competitiveness,
protect and strengthen the balance sheet and rebuild trust and transparence (Tesco, 2016).
This global brand, armed with over 400,000 staff, 6,902 retailer shops that serves millions of
customers upholds a strong mantra -“Serving Shoppers a Little Better Every Day”
It has also defined clear strategies for applying best global practices for its suppliers.

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In the Tesco’s annual report 2016, customers and suppliers’ KPIs were introduced which
suggests how important these stakeholders are in measuring the company’s performance. The
report show the significant contribution of these two stakeholders to the company’s overall
performance in the Corporate Governance Report (Tesco, 2016).
Following from the above, Tesco’s CSR and corporate governance is key to rebuilding trust
and transparency among its customers and suppliers. This is demonstrated and reported by
Tesco (2016) as follows:
• All surplus food from Tesco stores in UK goes to charity and none is wasted
• From the above mentioned they have adopted a strong Corporate Social Responsibility
(CSR) where 18 million meals have been donated to various charities through their surplus
redistribution work and neighborhood food collection.
• Tesco has also created Local Communities around its 6,902 retailer shops,
• Community Food Collection Nationwide drive has been deployed
• Local charities work with local stores (Local Food Collection and Distribution
Community) to help feed the needy. This was extended to 100 large stores by end of year
2016,
• Charity partnership with Diabetes UK and the British Heart Foundation to raise $30M to
promote healthy living,
• Tesco has also included customers and suppliers in its 6 big KPIs (Tesco, 2016 p. 12);
• The corporate report clarifies that "supplier code of conduct" together with "key
relationships with stakeholders, including employees, customers and suppliers", are the
responsibilities of the company and the board (Tesco, 2017, p.39)
• Customers have chosen specific community projects to receive $11.5M raised from sale
of Tesco bags since 2015; donated through Bags of Help (biggest environmental improvement
drive in UK) Performance of these non-financial CSR initiatives are tied with financial
objectives of Tesco as reported in Tesco (2016).

The above mentioned are evident in the Tesco’s annual report 2016, especially on (p. 8, 12-
13, 30, 39, 43, 51, 126) where these relationships between Corporate Governance and its
Social and Environmental Reviews and their stakeholders and performance measures are
clearly defined.

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CHAPTER III: BENEDICT Co. CORPORATE STRATEGIC FINANCIAL ANALYSIS

Barnes (1987) explains that financial ratios are useful and concludes that ratios are strong
indicators and excellent measure of performance for companies. Whereas Horrigan (1968)
asserts that the most significant development in finance has been the advent of financial ratios
for the purpose of financial analysis. The use of financial ratios is a time-tested method of
ascertaining the true picture of a company’s state of financial condition within a given period.
On the surface, a company’s prospective stakeholders may view a company as a thriving
business however the only way to truly ascertain how the company has been faring within a
given period of time is by dissecting the business using financial ratio analysis.
Even though Benedict Co’s since its establishment in 1983, has been popular for trading in
damaged or abandoned cargo and other items, from transport claims or warehouse losses
(Benedict Co. 2019). This report will now examine the company’s state of financial health and
its performance with a selected period of time - years 20X0 and 20X1. After calculating the
financial rations from the provided statement of income and financial position of the company,
the ratios will then be compared to the trend witnessed in other organisations in their industry,
The chosen financial ratios are tabulated below:
SUMMARY OF SELECTED FINANCIAL RATIOS
S/ Financial Relevance and purpose Formula
N Ratio
Profitability ratios: used to assess a business's ability to generate earnings relative to its
revenue, operating costs, balance sheet assets, or shareholders' equity over time, using
data from a specific point in time
1 Gross indicates the percentage of revenues that remain Gross Profit
Profit after deducting the cost of goods sold. x100
Margin www.thebalancesmb.com Sales
2 Net Profit indicates how well a company can transform its PBITx100
Margin revenues into profits. Net profit margin is the percent Sales
of revenue remaining after all operating expenses,
interest, taxes, and preferred stock dividends have
been deducted from a company's gross or total

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 revenue
www.accountingtools.com
3 Net Asset Asset turnover (total asset turnover) is a financial ratio Turnover___
Turnover that measures the efficiency of a company's use of its __
assets to product sales. It is a measure of how Capital
efficiently management is using the assets at its Employed
disposal to promote sales. The ratio helps to measure
the productivity of a company's assets
https://www.readyratios.com/reference/asset/asset_tu
rnover.html
4 Return on is a financial ratio that can be used in assessing a PBITx100_____
Capital company's profitability and capital efficiency. In other ___
Employed words, the ratio can help to understand how well a Total Assets-
(ROCE) company is generating profits from its capital Total Liabilities
Liquidity ratios: are an important class of financial metrics used to determine a debtor's
ability to pay off current debt obligations without raising external capital.
Quick ratio The Quick Ratio, also known as the Acid-test Current asset
measures the ability of a business to pay its short- less stock
term liabilities by having assets that are readily Current
convertible into cash. These assets are, namely, Liabilities
cash, marketable securities, and accounts receivable.
These assets are known as “quick” assets since they
can quickly be converted into cash.
Current also known as the working capital ratio, measures the Current asset
ratio capability of a business to meet its short-term Current
obligations that are due within a year. The ratio Liabilities
considers the weight of total current assets versus
total current liabilities. It indicates the financial health
of a company and how it can maximize the liquidity of
its current assets to settle debt and payables. The
Current Ratio formula (below) can be used to easily
measure a company’s liquidity.
Efficency ratios: Also known as use of resources tools. It is used to measure the

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efficiency of a company’s operations. It utilizes data from both balance sheet and profit and
loss statement
Stock days Calculates the number of days using an average Inventory x 365
worth of stock held by a company Cost of sales
Creditor Measures the number of days taken to compensate Trade payables
days creditors x 365
Sales
Debtor Measures the number of days taken for debtor to Trade
days reimburse receivables x
365
Sales
Cash cycle metric that expresses the time (measured in days) it Stock days +
conversion takes for a company to convert its investments in Debtor days -
inventory and other resources into cash flows from Creditor days
sales. Also called the Net Operating Cycle or simply
Cash Cycle
Gearing ratio is a financial ratio that compares some form of owner's equity (or capital) to
debt, or funds borrowed by the company. Gearing is a measurement of the entity's financial
leverage, which demonstrates the degree to which a firm's activities are funded by
shareholders' funds versus creditor's funds. www.investopedia.com
Gearing Measures debt as a percentage of the total capital Long term debt
ratio (equity and borrowings) funding the business x 100
Total Assets –
Total Liabilities
Debt/Equit indicates how much debt a company is using to Total Liabilities
y ratio finance its assets relative to the value of Shareholders
shareholders' equity. equity
Debt ratio Measures the relative amount of a company’s assets Total Liabilities
funded from debt Total Assets
Interest measures how many times a company can cover its Profit before
cover current interest payment with its available earnings interest and tax
Interest payable
Investor ratios are used to measure the ability of a business to earn an adequate return
for the owners of the business. The owners have money tied up in the business and need

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 a return commensurate with the risk involved
Return on A similar measure of ROCE Earnings after
equity tax x 100
Ordinary share
capital plus
reserve
Dividend DPS Dividend issued
per share to ordinary
(DPS) share
Earnings Show the amount of dividend (DPS) and profit (EPS) Earnings after
per share available to each ordinary shareholders tax or issued
(EPS) ordinary shares
Dividend Inverse of payout ratio EPS
cover DPS
Price/Earni Show the number of years earning that a shareholder Market Price per
ng Ratio will be willing to sacrifice in order to purchase one share
share EPS
Payout Inverse of dividend cover Dividend paid to
Ratio ordinary
shareholders x
100
Earnings after
tax
Earnings Shows the return to ordinary shareholders as a EPS x 100
yield percentage of the share price represented by EPS Market price per
share
Dividend Shows the return to ordinary shareholders as a DPS x 100
yield percentage of the share price represented by DPS Market price per
share

Adapted from: Scicluna, C. (2019), Module Handout Notes and Corporate Financial TM
Institute (Undated)
Calculations, Interpretations and Analysis of Benedict Co. Financial Ratios
Benedict Co. Profitability Ratio for 20X1 and 20X0

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Include the results for each chosen ratio and reasons for the movement between the
two years

The gross profits margin: This grew from $10.4M in 20X0 to $14.8M in 20X1 which is a
42.31% increase. Further calculation reveal that the Gross profit margin increased from
41.77% to 48.05% from 20X0 to 20X1 respectively. This increase can be as a result of the
23.69% increase in sales within the same period. It can be deduced that since the company
made more sales within a period, all things being equal, it will also make more profit.
Therefore, the increase in sales and reduced cost of sales in the company’s financials may
explain the increase noticed in gross profit margin
Net profit margin: This, however decreased from 32.93% in 20X0 to 22.73% in 20X1. This
was a result of the significant increase in finance cost (interest payment) which more than
doubled from $0.5m to $1.3m representing an increase of 160%.
Net Asset Turnover: Also, Net asset turnover increased during the years under review from
0.73 to 0.77 times. This may be attributed to the reported increase in sales than the capital
employed. This shows an improvement in Benedict Co.’s ability to generate more revenue
from capital injected in the business.
Return on Capital Employed (ROCE): The ratios above reveals that ROCE decreased from
24.19% in 20X0 to 17.50% in 20X1. From the above scenario, it is worthy to note that though
ROCE decreased under the two years in review, this could mean that there were more sales
with reduced prices to attract customers.
the increase in the capital employed from $33.9M to 40.0M in 20X0 and 20X1 respectively
seem to have contributed to the decrease in ROCE as well. The decrease in ROCE may also
be due to the company’s profit before taxes decrease from $8.7M to $8.3M in years 20X0 and
20X1 respectively (Appendix 6.2).
The decreased ROCE suggest that the company’s efficiency to use its capital to generate
profit has significantly reduced; or the company bought more products and sold at lower and
more competitive prices to attract and grow a larger customer base as evidenced by the

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increase in sales from $24.9m to $30.8m. We can also deduce that the reduction was as a
result of the 160% increase in finance cost (interest) which reduced the company’s ability to
generate more profits from its capital.
Benedict Co. Liquidity Ratios used to determine a debtor's ability to pay off current debt
obligations without raising external capital.
Table 4. Benedict Co. Liquidity Ratios in 20X0 and 20X1

Quick ratio or ‘Acid Test’, looks at the most liquid assets and compares it with current
liabilities. This decreased slightly from 0.75 to 0.70 during the years under review. From Table
4, it’s observed that, though quick ratio decreased from 0.75 to 0.70, It reduced due to the fact
that whereas current assets and stock both increased by 100% from year 20X0 to year 20X1,
current liabilities increased higher by 112% with the same period. It is however satisfactory
since it remained with the recommended figures of between 0.5 to 1 (Corporate Finance
Institute, Undated).

Current ratio decreased slightly as well from 1.25 to 1.19 during the two years under review.
In 20X1 for every $1.19 of current assets, the company had $1.0 liabilities. Thus Benedict Co.
can cover its liabilities marginally. The decrease in current ratio may have been caused by
increased sales reported earlier. To increase current ratio, Benedict Co can re-invest back its
profits by buying more assets or acquire a long-term loan or pay its debts. A very high current
ratio may mean that, cash is not being utilized in an optimal way. It just goes to show that if this
trend continues, the company might lose its ability to pay its short-term liabilities by having
assets that are readily convertible into cash. Jim (2011) argued that current ratios of 1.0 to 1.5
implies that, a business may struggle to pay its short-term liabilities.

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Benedict Co. Use of Resources Ratios (Efficency ratios): It is used to measure the
efficiency of a company’s operations)
Table 5. Benedict Co. Use of Resources Ratios

Stock/Inventory days normally measures the average number of days that the company
keeps its stock before selling. Benedict Co. stock days / inventory days has increased from
65.45 days to 118.68 days (Table 5) compared to the industry average of 60 days (Appendix
6.1). This is despite the earlier reported increase in sales. A high days inventory outstanding
indicates that a company is not able to quickly turn its inventory into sales. This can be due to
poor sales performance or the purchase of too much inventory. Having too much idle inventory
is detrimental to a company as inventory may eventually become obsolete and unsellable
according to corporate finance website
Creditor/Trade payable days
It was observed that Benedict Co. increased creditor days from 108.24 to 155.13, a difference
of 43.31 days in the years 20X0 to 20X1. This trade payables are way more than the average
in the industry players of 90 days. Even though payables are longer than receivables, Benedict
Co.’s trade suppliers may opt not to give credit to the company and opt to deal with other
industry players with better prognoses. This may also be interpreted that, the company
financial position is poor.
Cash conversion cycle is a cash flow calculation that measures the time it takes a company
to convert its investment in inventory and other resource inputs into cash. Table 5 shows a
remarkable increase in Benedict Co.’s cash conversion cycle from a mere 12.91 to 53.56 from
20X0 to 20X1. When a company – or its management – take an extended period of time to
collect outstanding accounts receivable, has too much inventory on hand or pays its expenses
too quickly, it lengthens the CCC. A longer CCC means it takes a longer time to generate
cash, which can mean insolvency for small companies.
Debtor days ratio measures the average number of days required for a company to receive
payment (trade receivables) from its customers for invoices issued to them (Bragg 2018).

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Table 5 shows an increase in debtor days ratio from 55.7 to 90.06, a significant increase of
43.9 days (62.66%) in 20X1 compared to the previous year. This shows a notable decrease in
the company’s ability to collect trade receivables and in my opinion reflects poorly on its
performance in 20X1. Benedict Co compares poorly with industry players with an average of
55 trade receivable days. On a positive note, this may be a deliberate policy to attract more
trade and compete with its industry players (Kaplan Financial, 2012).
The increase in all the efficiency ratios mentioned above makes it safe for us to conclude that,
Benedict Co. has not been performing optimally and has been inefficient in use of its
resources for its operations.

Gearing Ratios
Table 6. Benedict Co. Gearing Ratios for Years 20X1 and 20X0

Kaplan Financial (2012) argues that assessment of financial position of a business mainly
focuses on its stability and exposure to risk by considering the way the business is structured
and financed. This is referred to as gearing. Gearing measures the level of external debt a
company has (outstanding loans) in comparison to equity finance (share capital and reserves).
From our calculation in Table 6, gearing ratio increased slightly from 23.60 % to 30.00% from
20X0 to 20X1, which is below the recommended 50% (Scicluna, 2019). The increase may be
attributed to the company’s increase in long term debt from $8M to $12M (50%) compared to a
slight increase in capital employed from $33.9M to $40M (17.99%).

The liquidity ratios above, means that the company has increased its risk to cover its long-term
debts by its capital employed (Edwards, 2003). Debt/equity ratio has remarkably increased
from 30.89% in 20X0 to 42.86% in 20X1 (50%) which is due to an increase in the company’s
long-term debt acquisition than that of its stock capital and reserves (8.11% in Appendix 6.3).
Thus, the increase of capital and reserve was not able to balance a respective increase in

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debts of up to 50% as opined by Rushinek (1987, pp. 93 –100). Highly geared companies are
considered to be riskier but comparatively cheaper to service than lower geared companies.
Interest cover ratio measures the ability of a company to pay interest out of profits generated.
(Scicluna 2019 and Kaplan Financials, 2012). From Table 6, interest cover ratio decreased
from 16.40 times to 5.38 times, reflecting the decline in Benedict Co.’s profits (4.6% which also
led to an increase financial costs, having increased from $500.000 to $1.3 M (up by
160%).Though there is a decline I opine that, still the company is able to pay its interest from
the declined profits.
Though as a shareholder, this ratio should be monitored closely in the next financial year and
for it encouraged to invest in trade receivables recovery. As Edward (2003) argues Benedict
Co.’s interest cover ratio deterioration may pose a risk to shareholders’ dividends.
3.2.5 Benedict Co. Investor Ratios
Investor ratios measure the returns to the owner of the business (Kaplan Financials, 2012).
Table 7. Benedict Co. Investor Ratios for Years 20X0 and 20X1

Table 7 shows that return on equity decreased while DPS increased. The DPS increase can
be explained by the 25% increase in the total dividends paid (Appendix 6.2). Dividend Cover
decreased from 0.002 times to 0.001 times, because of the decreased earnings after tax and
the high dividends paid. EPS remained unchanged and significantly low. Payout ratio is
inversely proportional to dividend cover ratio and thus as one tends to zero the other grows to
infinity. Dividend yield ratio decreased from 0.56% to 0.45% as a result of increased stock's
market price of 55.56% (from $ 3.6 per share to 5.6 per share), offsetting the DPS by 25% as
observed. Earnings yield ratio decreased due to the observed deterioration of profitability and
EPS values tending to zero.
4. CONCLUSION
The analysis depicts Benedict Co. as a company whose financial position is weak, with strong
financial and business risks. They reveal very basic information such as whether you have
accumulated too much debt, stockpiled too much inventory or are not collecting receivables

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fast enough Its profitability and performance is seen to have deteriorated. The company’s
creditor and debtor days has increased significantly as well as cash conversion cycle. Liquidity
of the company is also straining its operations. This worsening state is disputed by an increase
of the gross profit margin and a slight increase in net asset turnover. Thus more analysis may
be needed for these findings to be conclusive. Use of resources ratios show that Benedict Co.
failed to accelerate its stock trading, collect revenues and to turn stock into cash. The
calculated liquidity ratios shows that the company may not be able to meet its short-term
liabilities and that it may be unable to cover its operational and sales costs. The 2 years in
review shows the company business and financial risks are increasing. Gearing ratios confirms
this position. Finally, investor ratios demonstrate Benedict Co.’s inability to generate earnings
for its investors, due to the observed earning lesser than its dividends values. Based on the
analysis and data provided, Benedict Co. cannot meet the requirements of potential
customers, investors, lenders and suppliers.
Critically evaluate the application of financial ratios in interpreting and measuring the
performance of a company
At some point, most businesses require an in-depth look at their financial structure. An
expansion project, low cash reserves or a jump in expenses can prompt you to conduct such
an exercise
Determine which ratios are relevant to you Every ratio gives you a different kind of insight into
your business. How you use them depends on your particular goals
Keep track over time Once you’ve determined which ratios to use, compare the results over
time to pick out trends or changes in your business performance
Benchmark your business
You also need to know how your business compares to others in your industry. With ratios,
there is no “magic number” a business should strive for—every company and every industry is
different.
Use ratios to drive strategy

The insights that come from the ratios you use should shape the direction of your business
plan. “Status quo can kill the potential of a business,” says Bourret. “You always want to be
adapting and innovating, and ratios can help you do that

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It's important to keep in mind that ratios are only one way to determine your financial
performance. Beyond what industry a company is in, location can also be important. Regional
differences in factors such as labor or shipping costs may also affect the result and the
significance of a ratio. Sound financial analysis always entails closely examining the data used
to establish the ratios as well as assessing the circumstances that generated the results.
5. REFERENCES
Paul Barnes (1987) https://doi.org/10.1111/j.1468-5957.1987.tb00106.x
https://www.bdc.ca/en/articles-tools/money-finance/managefinances/pages/using-
financial-ratios-analyze-business.aspx?type=C&order=3&intlnk=rightbox
Benedict Co. (2019). Benedict Company profile. Available online at:
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23 April 2019] Bryson, J. (1995).
Strategic planning for public and non-profit organization (Rev. Ed.) San Francisco: Jossey-
Bass Publishers.
Bryson, J.M. (2003). ‘What to do when stakeholders matter: A guide to stakeholder
identification and analyses’,
London School of Economics and Political Science , 10 February 2003. Corporate Financial
TM Institute (Undated). Financial Ratios: The Use of Financial Figures to Gain Significant
Information About a Company
https://corporatefinanceinstitute.com/resources/knowledge/finance/financial-ratios/ [Accessed:
23 April 2019] Eden, C. and Ackermann, F. (1998). Making Strategy: The Journey of Strategic
Management , pp117, London: Sage Publications. Latest edition Edwards, C. (2003).
Fundamentals of Corporate Finance. Available at:
http://highered.mheducation.com/sites/dl/free/0070898669/65177/Chapter17.ppt. [Accessed:
28 April 2019] Freeman, R.E (1984).
Strategic Management: A Stakeholder Approach
. Boston: Pitman. Freeman, R.E. and Reed, D.L. (1983). Stockholders and Stakeholders: A
New Perspective on Corporate Governance.
California Management Review

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. Available at: http://journals.sagepub.com/doi/10.2307/41165018 [Accessed: 24 April 2019].
Jim R. (2011). Q&A - How is the current ratio calculated and interpreted? Tutor2U.
https://www.tutor2u.net/business/blog/qa-how-is-the-current-ratio-calculated-and-interpreted
[Accessed: 24 April 2019]. Kaplan Financial (2012). Interpretation of Financial Statements:
Efficiency Ratios. Available: http://kfknowledgebank.kaplan.co.uk/KFKB/Wiki
%20Pages/Efficiency%20Analysis.aspx?mode=none. [Accessed: 26 April 2019]. Nutt, P. C.
and Backoff, R. W. (1992).
Strategic management of public and third sector organisations.
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Student ID: 3379447

6. APPENDICES
6.1Industrial Financial Data

6.2 Benedict Co.’s Income Statement

Student ID: 3379447

Student ID: 3379447
Student ID: 3379447