AFT 2073

FINANCIAL MANAGEMENT

SESI SEPTEMBER 2022/2023

GROUP ASSIGNMENT
NEGERI SEMBILAN OIL PALMS BERHAD
AND
SARAWAK OIL PALMS BERHAD

NAME OF LECTURER: DR. AZIRA HANANI BINTI AB RAHMAN

LECTURE / TUTORIAL: L4

GROUP MEMBERS MATRIC NUMBER TUTORIAL

NUR FATIN NABILA BINTI MOHD RADZI A21A2837 T2

NUR ALIS ALLYA BINTI MOHD NAZRY A21A2776 T1

FATIN SHAHIRA BINTI MOHD FODEE A21A2474 T2

FATIN NUR ALIS BINTI SHAMSUL A21A2470 T2

UMMUL HIDAYAH BINTI ANSAR A21A3165 T2

NUR AIN SYUHADA BINTI AZIZ A21A2763 T1

 TABLE OF CONTENTS

BIL CONTENT(S) NO PAGE

1. INTRODUCTION 2

2. BUSINESS NATURE OF THE COMPANY 3-5

3. DEFINITION AND FORMULA OF THE

6-8
CALCULATION ON FINANCIAL RATIOS

4. HORIZONTAL ANALYSIS ON FINANCIAL RATIOS 9 - 15

5. VERTICAL ANALYSIS ON FINANCIAL RATIOS 16 - 19

6. RECOMMENDATION 20

7. CONCLUSION 21

8. REFERENCES 22

9. APPENDICES 23 - 38

1
INTRODUCTION

Planning, arranging, and regulating all parts of finance are tasks that must be completed to
meet the company's financial objectives. The topics that are related to money can also be referred to
as finance. Giving someone money or credit for anything is another way to define finance. Finance
is generally utilized in relation to public finances or private funds of any kind of organizations.
Finance is an example of a bank that lends money to someone to purchase a home or a vehicle. A
financial manager's job is to estimate future profits, analyze financial data, and plan financially by
developing strategies to reduce operating costs for the company. In addition, financial managers also
control and coordinate the organization formulated efficiently or effectively to achieve organizational
and departmental goals.

2
BUSINESS NATURE OF THE COMPANY
• Negeri Sembilan Oil Palms Berhad

Negeri Sembilan Oil Palms Berhad is a Malaysia-based company, which is engaged in the
cultivation of oil palms and sale of fresh fruit bunches (ffb) and investment holding. The Company's
subsidiaries are engaged in the cultivation of oil palms, and processing and selling of crude palm oil
and palm kernel. The Company operates approximately four estates, namely, Ladang Senama,
Ladang Ibam, Ladang Gula and Ladang Maran with a total land bank of approximately 7,682
hectares. It also owns over two palm oil mills with a total milling capacity of 40 million tons (mt)
per hour. The Company through its joint venture interest in Chin Thye Investment Pte Ltd, owns
interest in an oil palm plantation in South Sumatera Province, Indonesia. The Company's subsidiaries
include Eng Thye Plantations Berhad and Timor Oil Palm Plantation Berhad.

The unprecedented COVID-19 pandemic throughout the country and the world has severe
impact on livelihoods and economic activities. They are grateful for the opportunity to be allowed to
operate as an essential service throughout the various phases of the Movement Control Order
(*MCO") imposed by the Malaysian Government. To protect employees and stakeholders, the
company executed safe operating Standard Operating Procedures ("SOP*) required by the
government and have also carried out other internal risk mitigation measures.

Since the end of FY2020, the average selling prices of ffb, CPO and PK have strengthened
significantly. The prevailing strong selling prices of ffb, CPO and PK are expected to have a
favourable impact on the plantation profit for financial year ending 31 December 2021. The long-
term prospects of palm oil are promising as there is global demand for palm products. Palm oil is
widely available and affordable, and it is one of the vital oils in meeting the world's dietary needs.
Besides its nutritional values, palm oil also has vast potential as a renewable energy source

3
PERFORMANCE

During FY2020, revenue of the Group increased by 23.20% to RM62.382,920 from

RM50,636,442 a year ago. The average selling prices of fresh fruit bunches ('ff*), crude palm oil
('CPO") and palm kernel (PK*) in FY2020. Strengthened significantly when compared with those a
year ago. During FY2020, production of ffb increased by 12.62% to 101,881 tonnes from 90,463
tonnes. Purchases of 11L decreased by 56.54% to 6,938 tonnes from 15.965 tonnes. Overall,
production of CPO decreased by 12.12% to 9,864 tonnes from 11,225 tonnes and production of PK
also decreased, by 14.03% to 2,598 tonnes from 3,022 tonnes. Overall, the Group recorded profit net
of tax of RM867.596 in FY2020 compared with loss net of tax of RM4.032,814 a year ago.

• Sarawak Oil Palms Berhad

SOPB started out as a joint venture between the Commonwealth Development Corporation
(CDC) and the Sarawak State government in 1968 to pioneer the commercial planting of oil palms
in the state with an initial land area covering 4,600 hectares of oil palm plantation under the name of
Sarawak Oil Palms Sendirian Berhad (SOPSB) before the group changed to its name to SOPB
officially in 1990.SOPB is involved primarily in the cultivation of oil palms and the operation of
palm oil mills.

SOPB was listed on the Bursa Malaysia in August 1991. In June 1995, Shin Yang Plantations
Sdn. Bhd. (SY Group) bought over CDC’s entire share in SOPB of 25%. Presently, SY Group
together with Pelita Holdings Sdn. Bhd., an investment arm of the Sarawak State Government
involving in property, urban development and plantation remain as the two substantial shareholders
of SOPB with shareholding of approximately 35% and 28% respectively. SOPB Group has since
then expanded its land bank to over 122,000 hectares, with 88,000 hectares planted with oil palm
trees in Sarawak. Oil palm plantation and the production of crude palm oil and palm kernels will
continue to remain as the sole core business of SOPB Group.

SOPB Group has more than 10,000 employees ranging from estate workers to professionals in
various functional units. The Group has always emphasised on upgrading the skills and knowledge
of the employees to expand and improve efficiencies in its business operations. SOPB practices
responsible and good agricultural practices from its first oil palm plantation developed in the late
1960’s when it was jointly established between Commonwealth Development Cooperation (CDC)
and the Sarawak State Government. These agricultural policy, good management practices and
methodologies were further refined and improved incorporating sustainable agricultural practices to
include social and environmental aspects.
4
PRODUCT

This company have branded consumer product such as cooking oil like Merris and Sarraco.
Firstly, MERRIS Premium Red Palm Oil which is the Finest that enriched blend from palm which
is enhanced with Tocotrienols [Super Vitamin E] and Carotenes [Pro-Vitamin A], The Classic
MERRIS Red Palm Oil is enhanced with Caro-A pro-Vitamin A, and T3E Super Vitamin E,
MERRIS Pure Vegetable Oil (100% Natural and Versatile) which is enriched with T3E® Super
Vitamin E, trans-fat free and has no cholesterol. Next is, MERRIS Blended Oil from Quality
Packing Plant MERRIS Blended Oil- cooking oil with peanut and sesame aroma blended from all
natural ingredients, from quality packing plant. MERRIS Blended Oil is rich with natural Vitamin
E, cholesterol free, trans fat free. Lastly, MERRIS Sunflower Oil which is the healthy choice.
MERRIS Sunflower Oil, healthy choice with high content of poly-unsaturated fat. MERRIS
Sunflower Oil are extracted from sunflower seeds of premium origin and processed under stringent
process control to maintain high contain of natural Vitamin E, suitable for household cooking and
salad dressings.

Next is Saracco which is SARACO Pure Vegetable Oil (Great Value Frying Oil). SARACO
Pure Vegetable Oil is our heart-healthy cooking oil processed from pure refined palm olein. It is rich
in natural Vitamin E with no cholesterol. SARACO oil is stable at high temperature, making it an
excellent choice for general and high-heat cooking. Ideal for both household and industrial frying
application, it offers longer frying life and greater value for money while maintaining the crispiness
and taste of food. Other than that, there is a lot of products that the company produced such as
Biodiesel (B100), Crude Glycerine, Neutralized Palm Oil (NPO), Palm Kernel Meal, Crude palm
Kernel Oil and many more.

5
DEFINITION AND FORMULA OF THE CALCULATION ON FINANCIAL RATIOS

Liquidity Ratios

Liquidity ratios can be defined as measuring the ability of the business to make payments to
the banks and creditors in short terms which shows the ability of the business to clarify current
liabilities when claimed.

Current ratio

Current ratio can be said to measure the business ability to pay off the short-term debts within
a year. If the ratio is low and the current liability exceeds the current asset, the business will face
several problems like the business will not be able to pay all the current liabilities owned while if the
ratio is high, it means that the liquidity of the business is high.

CURRENT RATIO = CURRENT ASSETS / CURRENT LIABILITIES

Quick Ratio

Quick ratio can be defined as measuring the ability of a business to pay the short-term debts
immediately without selling inventory. This ratio will give a more accurate picture of liquidity of
business as it considers the assets that can convert into cash immediately.

QUICK RATIO = CURRENT ASSETS - INVENTORY / CURRENT LIABILITIES

Net Working Capital

Net working capital is an important measure that helps the investors in determining the
liquidity position of the company. It basically indicates if the company has enough short-term
convertible assets to meet its short-term debt obligations.

NET WORKING CAPITAL FORMULA = CURRENT ASSETS – CURRENT LIABILITIES

Activity Ratio
Inventory turnover

Inventory Turnover is the rate that inventory rate that inventory stock is sold or used and
replaced. The inventory turnover ratio is calculated by dividing the cost of goods by average
inventory for the same period. A higher ratio tends to point to strong sales and a lower one to weak
sales.

INVENTORY TURNOVER= COGS OR SALES / INVENTORY

6
Account Receivable Turnover

Accounts Receivable Turnover can be defined to measure how efficiently a company collects
revenue and, further, the extent to which it uses its assets efficiently. This ratio measures the number
of times that a company contains an average of its accounts receivable in each period.

ACCOUNT RECEIVABLE TURNOVER = SALES / ACCOUNT RECEIVABLE

Fixed Assets Turnover

Evaluating performance of the company can be known as the Fixed Assets Turnover. The
ideal ratio compares net sales with fixed assets on the balance sheet and analyses a business’s capacity
to produce sales revenue from fixed assets. A higher fixed asset turnover ratio shows that a business
has successfully used fixed asset expenditures to earn revenues.

FIXED ASSETS TURNOVER = SALES / FIXED ASSETS

Total Assets Turnover

Total Assets Turnover calculates a company's business. The asset turnover ratio could be used
to determine how effectively a firm utilizes its assets to produce revenue. The greater a business's
asset turnover ratio, the more effective it is in generating revenue by their assets. In contrast, a lower
asset turnover ratio implies that a business is not properly exploiting its assets to generate revenues.

TOTAL ASSETS TURNOVER = SALES / TOTAL ASSETS

Leverage or Solvency Ratio

Debt Ratio
A common evaluation for any investment that requires a loan is a measure of a company's
financial stability. The less reliant a company is on debt for asset formation, the less risky the
company is. On the other hand, a higher ratio indicates that a company is at high risk of insolvency
because excessive debt can result in a heavy debt repayment burden.
DEBT RATIO = TOTAL DEBT / TOTAL ASSETS

Debt to Equity

Debt to Equity Ratio is calculated by dividing the company’s shareholder equity by the total debt,
thereby reflecting the overall leverage of the company and thus its capacity to raise more debt.
DEBT TO EQUITY = TOTAL LIABILITIES / SHAREHOLDER’S EQUITY

7
Profitability Ratio

Gross Profit Margin

Is the percentage of gross profit earned from sales after sales costs are deducted. Furthermore,
it reflects the business's efficiency in determining and controlling the price of merchandise or raw
materials purchased for sale. If the ratio is high, it is considered satisfactory; if it is low, it is
considered unsatisfactory due to high selling costs and low selling price.

GROSS PROFIT MARGIN = GROSS PROFIT / SALES

Net Profit Margin

The Net Profit Margin, or simply net margin, measures how much net income or profit is
generated as a percentage of revenue. It is the ratio of net profits to revenues for a company or
business segment. Net profit margin is typically expressed as a percentage but can also be represented
in decimal form.

NET PROFIT MARGIN = EARNING AFTER TAX / REVENUE

Return on Assets

Return on assets (ROA) is an indicator of how profitable a company is relative to its total
assets. ROA gives a manager, investor, or analyst an idea as to how efficient a company's
management is at using its assets to generate earnings.

RETURN ON ASSETS = EARNING AFTER TAX / TOTAL ASSETS

Return on Equity
The Return on Equity can be defined to measure the profitability of a business in relation to
equity. Because shareholder’s equity can be calculated by taking all assets and subtracting all
liabilities, ROE can also be through of as a return on assets minus liabilities.

RETURN ON EQUITY= EARNINGS AFTER TAX / TOTAL EQUITY

Return on Investment
Return on investment (ROI) is a financial ratio used to calculate the benefit an investor will
receive in relation to their investment cost. It is most commonly measured as net income divided by
the original capital cost of the investment. The higher the ratio, the greater the benefit earned.

ROI = EARNINGS AFTER TAX / TOTAL ASSETS

8
HORIZONTAL ANALYSIS ON FINANCIAL RATIOS
• Negeri Sembilan Oil Palms Berhad
Liquidity Ratio

2019 2020 2021

RATIO
(RM) (RM) (RM)
= Current Assets /
= Current Assets / = Current Assets / Current
Current Liabilities
Current Current Liabilities Liabilities
= 40,340,310 /
Ratio = 28,103,695/ 3,021,975 = 26,211,850 / 2,803,031
4,287,388
= 9.29 times = 9.35 times
= 9.41times
2021 is the highest current ratio which is 9.41 times than 2019 which is 9.29 times
Summary and 2020 which is 9.35 times. This higher ratio shows that 2021 could pay the short-
term obligations immediately.

= Current Assets - = Current Assets - = Current Assets -

Inventory / Current Inventory / Current Inventory / Current
Quick Liabilities Liabilities Liabilities
Ratio = 28,103,695 – 545,012 / = 26,211,850 – 438,162 / = 40,340,310 – 920,413
3,021,975 2,803,031 / 4,287,388
= 9.12 times = 9.19 times = 9.19 times

2020 and 2021 is the highest quick ratio which is 9.19 times than 2019 which is 9.12
Summary times. The higher ratio proved that in year 2020 and 2021 can pay the short-term
obligations without rely on its inventories.

= Current Assets –
= Current Assets – = Current Assets – Current
Net Current Liabilities
Current Liabilities Liabilities
working = 40,340,310 -
=28,103,695- 3,021,975 = 26,211850- 2,803,031
Capital 4,287,388
= 25,081,720 = 23,408,819
= 36,052,922

By year 2021, it was recorded as the highest net working capital for RM36,052,922
Summary through 2019 until 2020. Followed by year 2019 and year 2020, with RM25,081,720
and RM23,408,819 respectively.

9
Activity Ratios

2019 2020 2021

RATIO
(RM) (RM) (RM)

= COGS or sales / = COGS or sales / = COGS or sales /

Inventory Inventory Inventory
Inventory Turnover = 10,422,806 / = 10,682,801 / = 14,798,710 /
545,012 438,162 920,413
= 19.12 times = 24.38 times = 16.08 times

2020 are the highest of inventory turnover which is 24.38 times than
Summary 2019 (19.12 times) and 2021 (16.08 times). Years 2020 are the
effectiveness of inventory to generate the sales.

= Sales / Account = Sales / Account = Sales / Account

Receivable Receivable Receivable
Account Receivable
= 15,882,326 / = 23,989,245 / = 42,496,730 /
Turnover
2,025,875 2,700,833 4,711,164
= 7.84 times = 8.88 times = 9.02 times

2021 is the highest account receivable turnover which is 9.02 times than
2019 which is 7.84 times and 2020 is the lowest which is 8.88 times.
Summary
This higher ratio shows that 2021 has the ability collections process is
efficient.

= Sales / Fixed Assets = Sales / Fixed Assets = Sales / Fixed Assets

Fixed Assets = 15,882,326 / = 23,989,245 / = 42,496,730 /
Turnover 541,212,533 543,539,062 542,123,085
= 0.03 times = 0.04 times = 0.08 times

By Year 2021, it was recorded as the highest fixed asset turnover for
0.08 times through 2019 until 2021. Followed by Year 2019 and Year
Summary 2020, with 0.03 times and 0.04 times respectively. It was shown that,
Year 2021 was the most ideal and suitable of fixed assets to earn
revenues.

= Sales / Total Assets = Sales/ Total Assets = Sales /Total Assets

Total Assets = 15,882,326 / = 23,989,245 / = 42,496,730 /
Turnover 569,316,228 569,750,912 582,463,395
= 0.03 times = 0.04 times = 0.07 times

By Year 2021, it was recorded as the highest total asset turnover for
0.07 times through 2019 until 2021. Followed by Year 2019 and Year
Summary
2020, with 0.03 times and 0.04 times respectively. It was shown that,
Year 2021 was the most appropriate of fixed assets to earn revenues.

10
 • Sarawak Oil Palms Berhad

Liquidity Ratio

2019 2020 2021

RATIO
(RM) (RM) (RM)

Current = Current Assets / = Current Assets / = Current Assets /

Ratio Current Liabilities Current Liabilities Current Liabilities

= 653,880 / 98,111 = 710,941 / 124,518 = 765,984 / 257,001

= 6.66 = 5.71 = 2.98

2019 is the highest current ratio which is 6.66 times than 2020 which is 5.71
Summary times and 2021 is the lowest which is 2.98 times. This higher ratio shows that 2019
could pay its short-term obligationsimmediately.

Quick = Current Assets - = Current Assets - = Current Assets -

Ratio Inventory / Current Inventory / Current Inventory / Current
Liabilities liabilities Liabilities
= 653,880 - 42,316 / = 710,941 - 40,841 / = 765,984 - 57,317 /
98,111 124,518 257,001
= 6.23 = 5.38 = 2.76

2019 is the highest quick ratio which is 6.23 times than 2020 which is 5.38 times
Summary and 2021 is the lowest which is 2.76 times. This higher ratio proved that 2019 could
pay its short-term obligations without rely on its inventories.

= Current Asset - Current = Current Asset - = Current Asset - Current

Net
Liabilities Current Liabilities Liabilities
working
= 653,880 - 98,111 = 710,941 - 124,518 = 765,984 - 257,001
Capital
= 555,769 = 586,423 = 508,983

2020 is the highest average collection period which is 5864,23 times than 2019
Summary which is 555,769 times and 2021 is the shortest which is 508,983. This is showing
the highest net working capital is 2020 which is 586,423.

11
Activity Ratios

2019 2020 2021

RATIO
(RM) (RM) (RM)

=COGS or sales / =COGS or sales / =COGS or sales /

Inventory Inventory Inventory Inventory
Turnover = 737,574 / 42,316 = 874,245 / 40,841 = 1,314,298 / 57,317
= 17.43 = 21.41 = 22.93

2021 is the highest inventory turnover which is 22.93 times than 2020 (21.41
Summary times) and 2019 (17.43 times). Years 2021 are the effectiveness of inventory to
generate the sales.

= Sales / Account = Sales / Account = Sales / Account

Account
Receivable Receivable Receivable
Receivable
= 737,574 / 303,545 = 874,245 / 316,496 = 1,314,298 / 420,260
Turnover
= 2.43 = 2.76 = 3.13

2021 is the highest account receivable turnover which is 3.13 times than 2020
Summary which is 2.76 times and 2019 is the lowest which is 2.43 times. This higher ratio
shows that 2021 could make the collection process efficient.

Fixed Sales / Fixed Assets Sales / Fixed Assets Sales / Fixed Assets
Assets = 737,574 / 1,911,351 = 874,245 / 1,920,620 = 1,314,298 / 2,003,399
Turnover = 0.39 = 0.46 = 0.66

By Year 2021, it was recorded as the highest fixed asset turnover for 0.66times.
Followed by Year 2020 and Year 2019, with 0.46 times and 0.39 times
Summary
respectively. It was shown that, Year 2021 wasthe most ideal and suitable of fixed
assets to earn revenues.

12
 Total Sales / Total Assets Sales / Total Assets Sales / Total Assets
Assets = 737,574 / 2,565,231 = 874,245 / 2,631,561 =1,314,298 / 2,769,383
Turnover = 0.29 = 0.33 = 0.47

By Year 2021, it was recorded as the highest total asset turnover for 0.47 times.
Followed by Year 2019 and Year 2020, with 0.29 times and 0.33 times respectively.
Summary
It was shown that, Year 2021 was the most appropriate of fixed assets to earn
revenues.

Profitability Ratio

2020 2020 2021

RATIO
(RM) (RM) (RM)

= Gross Profit / = Gross Profit / = Gross Profit /

Gross
Revenue Revenue Revenue
Profit
= 148,311 / 885,885 = 153,147 / 1,027,392 = 331,674 / 1,645,972
Margin
= 0.17 @ 17% = 0.15 @ 15% = 0.20 @ 20%

2021 is the highest gross profit margin which is 20% than 2019 which is 17%and
2020 is the lowest which is 15%. The gross profit margin every year is not
Summary
consistent because if there is an up and down it will be better if it alwaysincreases
even slowly.

= Net Profit/ Total = Net Profit/ Total = Net Profit/ Total

Assets Assets Assets
Return On
= 67,709 / = 48,952 / = 154,952 /
Investment
2,565,231 2,631,561 2,769,383
= 0.03 = 0.02 = 0.06

Return on investment in 2019 is 0.03 and decrease to 0.02 in 2020. In 2021, return
Summary on investment has increase from 0.02 to 0.06. The higher return on investment is
0.06 at 2021.

13
 = Earnings After = Earnings After = Earnings After
Net Profit Tax/Revenue Tax/Revenue Tax/Revenue
Margin = 67,709 / 885,885 = 48,952 / 1,027,392 =154,952 / 1,645,972
= 0.08 @ 8% = 0.05 @ 5% = 0.09 @ 9%

The net profit margin for the year of 2019 is 0.08. In 2020, net profit margin has
Summary decrease from 0.08 to 0.05. After that, net profit margin has increase from 0.05 to
0.09.

= Earnings After = Earnings After = Earnings After

Return on Tax/Total Assets Tax/Total Assets Tax/Total Assets
Assets = 67,709 / 2,565,231 = 48,952 / 2,631,561 = 154,952 / 2,769,383
= 0.03 @ 3% = 0.19 @ 19% = 0.06 @ 6%

The return on assets for the year of 2019 is 0.03 and increase to 0.19 in 2020. In
Summary
2021, return on assets has decrease from 0.19 in 2020 to 0.06 in 2021.

=Earnings after tax / =Earnings after tax/ =Earnings after tax/

Return on Total equity Total equity Total equity
Equity = 67,709 / 2,115,570 = 48,952 / 2,140,371 = 154,952 / 2, 242,946
= 0.03 @ 3% = 0.02 @ 2% = 0.07 @ 7%

2021 is the highest return on equity which is 0.07 times than 2019 (0.03 times)
Summary and 2020 (0.02 times). This higher ratio of 2021 indicates the higher return to
shareholders.

14
Leverage or solvency Ratios

2019 2020 2021

RATIO
(RM) (RM) (RM)

= Total Debt / =Total Debt / Total = Total Debt / Total

Debt TotalAssets Assets Assets
Ratio = 449,661 / 2,565,231 = 491,190 / 2,631,561 = 526,437 / 2,769,383
= 0.18 @ 18% = 0.19 @ 19% = 0.19 @ 19%

Year of 2020 and 2021 have the same debt ratio which is 19% and in 2019 debt
Summary
ratio is 18%. Since in 2020 they have faced a Covid-19 it affects the debtratio.

= Total Debt / Equity

= Total Debt / Equity = Total Debt / Equity
Debt To = 491,190 /
= 449,661 / 2,115,570 = 526,437 / 2,242,946
Equity 2,140,371
= 0.21 = 0.23
= 0.23

This shows that debt to equity the company was lowest in 2019 which is 0.21. In
Summary
2020, debt to equity increase from 0.21 to 0.23 and remain 0.23 in 2021.

15
VERTICAL ANALYSIS ON FINANCIAL RATIOS

Comparison between Negeri Sembilan Oil Palms Berhad and Sarawak Oil Palms Berhad

Liquidity Ratio

Negeri Sembilan Oil Palms

Sarawak Oil Palms Berhad
Berhad
Ratio
2021 2021

Current Ratio 9.41times 2.98times

In 2021, it shows that the current ratio for Negeri Sembilan Oil Palms
Summary Berhad is 9.41 times which is the highest compared to Sarawak Oil Palms
Berhad which is only 2.98 times.

Quick Ratio 9.19 times 2.76 times

In 2021, it shows that the quick ratio for Negeri Sembilan Oil Palms
Summary Berhad is 9.19 times which is the highest compared to Sarawak Oil Palms
Berhad which is only 2.76 times.

Net working
36,052,922 508,983
Capital

In 2021, it shows that the net working capital for Negeri Sembilan Oil
Summary Palms Berhad is 36,052,922 which is the highest compared to Sarawak
Oil Palms Berhad which is only 2508,983.

16
Activity Ratios

Negeri Sembilan Oil Palms

Sarawak Oil Palms Berhad
Berhad
Ratio
2021 2021

Inventory
16.08 times 22.93 Times
Turnover

In 2021, it shows that the inventory turnover for Sarawak Oil Palms
Summary Berhad is 22.93 times which is the highest compared to Negeri Sembilan
Oil Palms Berhad which is only 16.08 times.

Account
Receivable 9.02 times 3.13 times
Turnover

In 2021, it shows that the account receivable turnover for Negeri

Summary Sembilan Oil Palms Berhad is 9.02 times which is the highest compared
to Sarawak Oil Palms Berhad which is only 3.13 times.

Fixed Assets
0.08 times 0.66 times
Turnover

In 2021, it shows that the fixed assets turnover for Sarawak Oil Palms
Summary Berhad is 0.66 times which is the highest compared to Negeri Sembilan
Oil Palms Berhad which is only 0.08 times.

Total Assets
0.07 times 0.47 times
Turnover

In 2021, it shows that the total assets turnover for Sarawak Oil Palms
Summary Berhad is 0.47 times which is the highest compared to Negeri Sembilan
Oil Palms Berhad which is only 0.07 times.

17
Profitability Ratio

Negeri Sembilan Oil Palms

Sarawak Oil Palms Berhad
Berhad
Ratio

2021 2021

Gross Profit
0.65 @ 65% 0.20 @ 20%
Margin

Gross profit margin for Negeri Sembilan Oil Palms Berhad is better than
Summary Sarawak Oil Palms Berhad with 65% and 20% because Negeri Sembilan
Oil Palms Berhad had a higher gross profit margin.

Net Profit Margin 0.45 @ 45% 0.09 @ 9%

Net profit margin for Negeri Sembilan Oil Palms Berhad is better than
Summary Sarawak Oil Palms Berhad because Negeri Sembilan Oil Palms Berhad
had a higher gross profit margin.

Return on Assets 0.03 @ 3% 0.06 @ 6%

The return on assets for Sarawak Oil Palms Berhad is higher than Negeri
Summary
Sembilan Oil Palms Berhad.

Return on Equity 0.04 @ 4% 0.07 @ 7%

In 2021, Sarawak Oil Palms Berhad had a higher return on equity than
Summary
Negeri Sembilan Oil Palms Berhad.

Return on
0.03 @ 3% 0.06 @ 6%
Investment

In 2021, Sarawak Oil Palms Berhad had a higher return on investment

Summary
than Negeri Sembilan Oil Palms Berhad.

18
Leverage or Solvency Ratios

Negeri Sembilan Oil Palms

Sarawak Oil Palms Berhad
Berhad
Ratio

2021 2021

Debt Ratio 0.07 @ 7% 0.19 @ 19%

Sarawak Oil Palms Berhad had a higher debt ratio than Negeri Sembilan
Summary Oil Palms Berhad. It shows that Negeri Sembilan Oil Palms Berhad is
better than Sarawak Oil Palms Berhad.

Debt to Equity 0.08 @ 8% 0.23 @ 23%

Sarawak Oil Palms Berhad had a higher debt to equity than Negeri
Summary Sembilan Oil Palms Berhad. It shows that Negeri Sembilan Oil Palms
Berhad is better than Sarawak Oil Palms Berhad.

19
RECOMMENDATION

Based on our study, we found that the income of net profit margin for Negeri Sembilan
Oil Palms Berhad is better than Sarawak Oil Palms Berhad because Negeri Sembilan Oil Palms
Berhad had a higher gross profit margin. Berhad. Therefore, we provide a few
recommendations for both Palms Oil to take initiative to improve some aspects.

The irregularities and deficiencies in the procedures being used by businesses to obtain
the consent of local communities (often with the assistance of governmental agencies) suggest
that these procedures need to be drastically revised and rigorously monitored by independent
third parties, to ensure that consent, when given, is done so voluntarily, based on adequate and
comprehensive information, and before project permits are issued and operations begin.

Companies recognize pay more attention to the fact that indigenous and tribal
communities, whether they write legal ownership or not, rights to the land and resources they
have traditionally owned, inhabited, or otherwise used or purchased. often access Resources
and Rights to Resources more important to some communities as a landowner. local diversity
communities, ethnic groups, land use, Rights within one scope must be many better understood
and considered to avoid homogenization, companies should these different groups and
interests, and avoid generalizing about your views or needs. One for everyone else. there must
be this too Because it is reflected in the standard.

Stronger and clearer language is needed on the nature of FPIC as a right of indigenous
peoples and local communities in existing certification standards, as opposed to it being treated
as a form of consultation or ‘socialisation’, which are part of, but not tantamount, to FPIC.
Human rights training at the level of the company, government and local communities can be
instrumental to this end. In particular, the participation of local community members in
consultation activities should be clarified to these participants as not being equivalent to their
giving consent to the issues discussed. In the case of New Plantings, the early stages of the
process of respecting the right to FPIC of local communities should be initiated prior to the
identification of the net land area and well prior to obtaining final permissions.

20
CONCLUSION

As a result of the COVID-19 pandemic, Negeri Sembilan Oil Palms Berhad and
Sarawak Oil Palms Berhad saw a decline in their profit figures. The biggest number of earnings
were achieved by Negeri Sembilan Oil Palms Berhad and Sarawak Oil Palms Berhad in 2018,
followed by 2019 and 2020. This is since the COVID-19 is the primary reason that these issues
affect all enterprises and industries. This epidemic has an impact on numerous businesses,
forcing them to deal with bankruptcy and a decline in their financial performance. Other than
that, we may draw the conclusion that this assignment demonstrates that learning about
financial management involves more than just theoretical knowledge, it also involves applying
what we have learned or even faced in our own live expenses. Besides, this task has raised
awareness for us that financial management is crucial to run and maintain our business for a
long time. We also can conclude that the stronger our financial management the greater the
opportunity that we must maximize our profits in the short-term and to grow our capital value
in the long-term. The stronger our financial management the easier it is for us to raise finance
and probably at a lower cost. Obviously, banks prefer to work with business owners who can
control their financial well. Based on our observation, we can learn how to practice finance in
entrepreneurship. Experience is the knowledge or skills or observations of an object that gained
through involvement or exposure to objects or events.

21
REFERENCES

1. Bursa Malaysia. (n.d.). Retrieved January 2, 2023, from

https://www.bursamalaysia.com/market_information/announcements/company_annou
ncement
2. Bursa Malaysia. (n.d.). Retrieved January 2, 2023, from
https://www.bursamalaysia.com/market_information/announcements/company_annou
ncement
3. Bursa Malaysia. (n.d.). Retrieved January 2, 2023, from
https://www.bursamalaysia.com/market_information/announcements/company_annou
ncement
4. Bursa Malaysia. (n.d.). Retrieved January 2, 2023, from
https://www.bursamalaysia.com/market_information/announcements/company_annou
ncement
5. Bursa Malaysia. (n.d.). Retrieved January 2, 2023, from
https://www.bursamalaysia.com/market_information/announcements/company_annou
ncement
6. Bursa Malaysia. (n.d.). Retrieved January 2, 2023, from
https://www.bursamalaysia.com/market_information/announcements/company_annou
ncement

22
APPENDICES
• Negeri Sembilan Oil Palms Berhad

Figure 1: Statements of Profit or Loss 2019

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Figure 2: Statements of Profit or Loss 2019

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Figure 3: Statements of Financial Position 2019

25
Figure 4: Statements of Profit or Loss 2020

26
Figure 5: Statements of Profit or Loss 2020

27
Figure 6: Statements of Financial Position 2020

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Figure 7: Statements of Profit or Loss 2021

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Figure 8: Statements of Profit or Loss 2021

30
Figure 9: Statements of Financial Position 2021

31
• Sarawak Oil Palms Berhad

Figure 10: Statements of Profit or Loss 2019

Figure 11: Statements of Profit or Loss 2019

32
Figure 12: Statements of Financial Position 2019

Figure 13: Statements of Financial Position 2019

33
Figure 14: Statements of Profit or Loss 2020

Figure 15: Statements of Profit or Loss 2020

34
Figure 16: Statements of Financial Position 2020

Figure 17: Statements of Financial Position 2020

35
Figure 18: Statements of Profit or Loss 2021

Figure 19: Statements of Profit or Loss 2021

36
 Figure 20: Statements of Financial Position 2021

Figure 21: Statements of Financial Position 2021

37