Assessment Task: You are the Assistant Financial Analyst at GreenLeaf Industries, a mid-sized company sp

Learning Outcomes Assessed:

LO1: Demonstrate the skills and knowledge to interpret and maintain basic financial data.

LO2: Illustrate how financial data analysis can aid decision making in business.

LO3: Demonstrate ICT skills in data manipulation

Assessment Task:

You are the Assistant Financial Analyst at GreenLeaf Industries, a mid-sized company specialising in eco-friendly packaging solutions. The company is considering expanding into new markets and seeking additional investment from potential investors. Senior management requires a comprehensive financial analysis report to assess the company’s current financial health and the viability of the expansion.

Your task is to use financial data interpretation and problem-solving techniques to prepare a professional report for the senior management team and potential investors.

Your report should include the following sections: –

 

 

Introduction (Aim of the report)                                                                                             (5 Marks)

Section 1 (20 Marks)

(i)     Define and discuss the theory behind financial management and its importance.               (10 Marks)

(ii)    Explain the usefulness of financial statements in decision making process.        (10 Marks)

 

Section 2 (50 Marks)

You are required to use the templates provided in MS Excel document and provide 1 screenshot each in the appendix area for all questions in this section.

GreenLeaf Industries

Trial Balance as at 31 March 2025

Account

Debit (£)

Credit (£)

Revenue

 

93,500

Cost of Goods Sold

42,570

 

Salaries and Wages

16,900

 

Sales & Admin Expenses

4,285

 

Marketing Expense

2,875

 

Overheads

3,800

 

General Expenses

1,250

 

Interest Expense

1,000

 

Tax Expense

3500

 

Cash

8,500

 

Accounts Receivable

12,000

 

Inventory (Closing)

10,000

 

Property, Plant & Equipment (PPE)

65,000

 

Furniture & Fittings

24,820

 

Motor Vehicles

30,000

 

Accounts Payable

 

9,000

Accrued Expenses

 

3,000

Short-term Bank Overdraft

 

2,500

Bank Loan (Long-term)

 

30,000

Bonds Payable

 

20,000

Share Capital

 

50,000

Retained Earnings (Opening)

 

18,500

Totals

226,500

226,500

 

 

 

 

 

 

Using the financial data provide above, you are required to:

2(A) Prepare the Income Statement in the Excel Sheet (A). (see Excel Template)                           (10 Marks)

2(B) Conduct a vertical analysis of the income statement in the Excel Sheet (A). (see Excel Template)                                                                                                                             (10 Marks)

2(C) Prepare the statement of financial position (Balance sheet) in Excel Sheet (B) (see Excel Template).                                                                                                                                     (15 Marks)

2(D) Use the data from the Excel sheet (A & B), GreenLeaf Industries’ financial statements to calculate the following ratios in Excel Sheet (C) (see Excel Template):

Profitability: Net Profit Margin, Return on Capital Employed (ROCE) Liquidity: Current Ratio, Quick Ratio Efficiency: Asset Turnover Ratio                                                                                  (15 Marks) (Show ratio formulas & workings)

 

Section 3 (20 Marks)

Industry averages

Ratio

Industry Average

Net Profit Margin

15%

ROCE

18%

Current Ratio

2.0

Quick Ratio

1.2

Asset Turnover Ratio

1.8

 

Using the industry averages given above, you are required to:

Compare GreenLeaf Industries’ performance results from section 2(D) with the industry averages and discuss where the company is performing better or worse compared to industry.