The assignment requires you to recommend an investment portfolio to Mr Morrison on behalf of Forward Investments Ltd. If Mr Morrison invests all his fund of Au$60,000
in 5% debentures of Qantas Limited he will receive (Au$60,000 x 5%= Au$3,000) Au$3000 every year for the next 5 years totalling to $15,000 interest. At the end of the
five year term he will receive back the principal. On the other hand, if he invests all the Au$60,000 in debentures of JB Hi-Fi Limited, he will receive (Au$60,000 x
5.5%=$3,300) $3,300 every year for the next 5 years totalling to $16,500 interest. At the end of the five year term he will receive back the principal.
On the other hand, if Mr Morrison invests in shares he will receive dividend depending on the amount of dividend declared by respective companies. He will also have
the option of selling his shares if the price of shares increases in the market resulting in gain from such sale. Hence, if he invests in shares and the share price
increases and/or these companies declare dividend and/or perform well in future years, it will be a beneficial for Mr Morrison. Hence in deciding whether to invest in
shares you will need to consider the short and long term potential of these companies.
Alternatively you can recommend Mr Morrison to invest some of his funds in shares and some in debentures.
Your recommendation needs to be guided by at least the followings:
?Financial information of Qantas Limited and JB Hi Fi Limited over the last three financial years 2011, 2012 and 2013. Refer to information in financial statements
such as revenue, expenses, profit, assets, liabilities, cash and other information items. Your analysis should address whether these components have changed over the
three years and explain why they have changed (you do not need to do this for every single item of the Income statement, Balance Sheet and Cash flow, but you need to
provide a well rounded explanation about the changes in items that are more significant in terms of financial performance of the company) and consider relating these
information items to your investment advice.
Also consider non-financial information and other analysis provided in annual reports of these companies. The non-financial information contained in the annual reports
can help you in understanding better the changes in the financial statements and can help you explaining how the companies are performing. The assignment needs to
include thorough analysis of these three years’ financial statements and annual reports. We referred to financial statements in the first week and we will discuss in
further details about the components of financial statements in next few weeks.
?You need to also consider external sources. These may include news items, statistical information, industry analysis, current economy and other sources.
Please make sure that your recommendation to Mr Morrison is well argued and the report flows well.
œWith regard to the longitudinal analysis, we are not looking for detailed ratio analysis, but you can certainly look at the trend in components of financial
statements such as, whether the profit has increased or decreased and why? Whats the trend in current assets, non-current assets, current liabilities, non-current
liabilities and equity? This helps in analysing how risky the business is (from an investor’s point of view if a business has more borrowing it is more risky). Is the
business investing in non-current assets? or is it disinvesting? Why and what would be the implications? How is the cash situation?’
œThese are just some suggestions. Simona and myself are looking for how well you construct your arguments using the data provided in the annual reports and using data
from external sources.
FINANCIAL REPORTING AND ANALYSIS Assignment “ Trimester 2, 2014 Due Date: Monday 1 September 2014 by 11:59 pm (AEST1)
1. Assignment task
Imagine you are a financial analyst working for Forward Investments Ltd and have to prepare a report for a client in New Zealand, Mr Nick Morrison, who has Au$60,000
to invest in shares and/or debentures2. Mr. Morrison would like to invest in one or two of the following companies: Qantas Limited and JB Hi-Fi Limited in either equal
or varying proportion. Imagine that Qantas Limited is offering a return of 5% if invested in its debentures and JB Hi-Fi Limited is offering a return of 5.5% in its
debentures. Both companies have issued debentures of $1.5m for 5 years and Mr Morrison has the option of investing all of his funds into debentures only. Alternatively
he has the option to invest in a mix of shares and debentures.
You are required to prepare a report on behalf of Forward Investments Ltd for Mr. Morrison outlining your suggested investment strategy. Your suggestions have to be
informed by a longitudinal analysis of the last three years (2011, 2012, 2013) of the published annual reports of all two companies: Qantas Limited and JB Hi-Fi
Limited (the annual reports are available on CloudDeakin). In your analysis you need to consider both financial and nonfinancial aspects. Your evidence needs to
include data from the annual reports published by the companies. You may also refer to other sources such as news articles and relevant journals in addition to annual
reports. Drawing on additional sources will add to the breadth and depth of your discussion. This assignment is to be undertaken individually. The due date is Monday
1st September 2014, 11:59 pm (AEST). There will be no extensions of time granted unless there are exceptional and most unusual circumstances outside the students’
control. Any material used in this assignment must be acknowledged and appropriately referenced. Please refer to the Unit Guide for more information on ˜referencing’
requirements. The reference list (using Harvard Referencing System) is included in the total word count. If you include table(s) and figure(s) these are not included
in the word count. An assignment with less than 10 appropriate prime reference sources (blogs, internet discussions and Wikipedia are NOT acceptable as references)
dated back 20 years or more is unlikely to have demonstrated enough research to form defendable conclusions and will be assessed accordingly. Some marks are awarded
for report format, structure, spelling, grammar, punctuation etc. The Division of Student Life at www.deakin.edu.au/studentlife provides all students with editing
assistance. Students who wish to take advantage of this service should plan ahead and contact the Division of Student Life in order to schedule a booking, well in
advance of the due date of this assignment.
Australian Eastern Standard Time. Debentures are loan instruments issued by companies.
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MPA751 Assignment Trimester 2, 2014
2. THE ASSIGNMENT STRUCTURE
Please refer to the attached rubric for allocation of marks. # 1 2 3 SECTION Title page (not counted in the word count of the report) Introduction: Contains a concise
discussion of the background and purpose of the report. Longitudinal analysis of companies (financial and non-financial data including strategies, vision, comment on
change in executive remuneration etc.): “ Longitudinal analysis of Qantas Ltd. “ Longitudinal analysis of JB Hi-Fi Ltd. Discussion and analysis of the comparison of
longitudinal analysis of the two companies. Recommendations. Conclusion: Provides a summary of the issues raised, with concluding remarks. References Total words Word
4 5 6 7
Be sure that you adhere strictly to these requirements as penalties apply for failure to remain within the parameters of the prescribed word limits. A 10% tolerance
will be applied to the word limit. The title page should be the first page of your assignment and it must include the following information: ? Title: ˜Mr. Morrison’s
Investment’. ? Unit code and unit name: MPA751 “ Financial Reporting and Analysis. ? Name of the Unit Chair: Dr. Bikram Chatterjee. ? Your full name and Deakin student
ID number. ? Due date: Monday 1 September 2014, by 11:59pm (AEST). If granted a time extension, then insert the following: o Revised date approved by the unit-chair
(show approved date). ? The following statement: œI certify that the attached work is entirely my own, except where material quoted or paraphrased is acknowledged in
the text. I also declare that it has not been submitted for assessment in any other unit or course. Assignments that do not contain this statement will not be
assessed. ? Each page must be numbered and must show the total number of pages (e.g., Page 1 of 10), and every page must have a header that identifies your full name,
your Deakin student ID number, and the unit code MPA751. Students are NOT required to complete an ˜Assignment Attachment Sheet’ for this assignment. Tables or figures
are acceptable in this assignment and they are expected to be fully discussed and analysed. Tables or figures should be numbered sequentially, given appropriate
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MPA751 Assignment Trimester 2, 2014
and placed in the main body of this assignment at suitable points. Use of footnotes and Appendices are not permissible in this assignment.
3. ASSIGNMENT SUBMISSION
This assignment must be submitted electronically by the due date as a Microsoft Word document by uploading it to the assignment Dropbox, via the MPA751 site on
CloudDeakin. When uploading your assignment, give the document a name using the following syntax: <your surname_your first name_your Deakin student ID
number_MPA751.doc (or ˜.docx’), For example, ˜Jones_Barry_123456789_MPA751.doc’. Submitting a hard copy of this assignment is not required. Please review the section
on ˜Plagiarism’ in the Unit Guide for this unit and on the CloudDeakin site for this unit. You need to check that your assignment does not contain plagiarism. This is
done automatically when submitting your assignment to the ˜Dropbox’, which uses Turnitin, which in turn checks your assignment for plagiarism and generates an
originality report that you can use to be confident that your assignment does not contain plagiarism. Turnitin will tell us (but tell you first) the extent to which
your work has copied material from others without appropriate recognition through referencing. If this is excessive you will lose marks or you may not receive any
marks, or you may have some form of disciplinary action taken if the issue is severe. Take appropriate action to amend your report to avoid this from happening. Note
that uploading your assignment to Turnitin via the prescribed link in the CloudDeakin site for this unit constitutes submission to this unit AND also constitutes a
declaration regarding the contents of the assignment being all your own work, except where appropriate references to the work of others has been acknowledged. You can
upload your assignment to Dropbox as many times as you like up to the due date. In order to avoid a late submission penalty, you must upload your assignment to Dropbox
by the due date. A penalty of 30% of the mark achieved will be imposed if assignments are submitted after 24 hours past the due date without a valid extension.
Students who require a time extension in relation to this assignment should submit a written request to the Unit Chair, supported with documentation (for example,
medical certificate). Such requests should be e-mailed to the Unit Chair. Requests for time extensions will not be considered after 12 noon, Wednesday 27 August 2014.
Students are also reminded that extensions will only be given for exceptional and unusual circumstances outside the students’ control.
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MPA751 Assignment Trimester 2, 2014
4. MARKING RUBRIC
Performance Level descriptor Find information appropriate to the task (Total marks available 5 out 40) Poor (Score range 0-1.4) No appropriate evidence to support
arguments. Yet to achieve minimum standards Need improvement (Score range 1.5 -2.4) Little or inconsistent evidence to support arguments. Satisfactory (Score range
2.5-2.9) Some evidence to support arguments Meets standards Good (Score range 33.4) Reasonable use of evidence to support arguments Very good (Score range 3.53.9)
Appropriate use of evidence from the annual reports to support arguments, and some reference to additional sources of data/evidence. (Score range 3.53.9) A good
introduction. Well formulated background, objectives and/or conclusions. Information covers the breadth of the task, and shows depth. Discussion has a logical flow.
Exceeds standards Excellent (Score range 4-5) Appropriate use of evidence from the annual reports to support arguments, and extensive reference to additional sources
of data/evidence. (Score range 4-5) Excellent introduction. Clear articulation of background, objectives and/or conclusions. Discussion has a logical flow and coherent
line of argument throughout the assignment.
Evaluate and organise information in a logical and coherent way (Total marks available 5 out of 40)
(Score range 0-1.4) Poor introduction, no background, objectives or conclusions. Information provided does not relate to the task. Discussion is disjointed and
(Score range 1.5-2.4) Introduction provides little information. Some information provided relates to the task, but it is incomplete. Discussion lacks flow and is
somewhat disjointed and fragmented.
(Score range 2.5-2.9) Introduction provides some information. Information provided relates to the task but it is cursory. Discussion is disjointed or fragmented in
(Score range 33.4) A good introduction. Adequately formulated background, objectives and/or conclusions. Information covers the breadth of the task, and shows some
depth. Discussion has a
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MPA751 Assignment Trimester 2, 2014
logical flow, but is a little fragmented. Critically analyse and synthesise the information gathered (Total marks available 23 out of 40) (Score range 0-6.6) The
report is mostly descriptive. No constructive analysis of the information. Unable to organise and synthesise complex evidence and identify subtle patterns, differences
or similarities. None or little interpretation/evaluation, not enough to develop a coherent analysis or synthesis. (Score range 6.9-11.2) Some attempt to provide a
balanced discussion has been provided. No constructive analysis of information. Does not synthesise information and/or demonstrate an advanced and integrated
understanding. Some interpretation/evaluation, but not enough to develop a coherent analysis or synthesis. (Score range 11.5-13.5) (Score range 13.815.8) A balanced
discussion has been provided. The A balanced constructive analysis is discussion has been cursory. provided. A constructive analysis is present Adequate synthesis of
but lacks depth. information. Adequate interpretation/evaluation to develop a coherent analysis and understanding. Mostly wellarticulated synthesis of information and
demonstration of an integrated understanding. Specific position/perspective is presented. Some competing arguments are presented in the report as appropriate. (Score
range 16.118.1) A balanced discussion has been provided. A constructive analysis is present but lacks some depth. Mostly wellarticulated synthesis of information and
demonstration of an advanced and integrated understanding. Specific position/perspective is presented and accurately takes into account the complexities of an issue.
Some competing arguments are (Score range 18.423) A balanced discussion has been provided. The constructive analysis shows depth of knowledge and insight.
Well-articulated synthesis of information and demonstration of an advanced and integrated understanding. Specific position/perspective is expertly presented and
accurately takes into account the complexities of an issue. Extensive
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MPA751 Assignment Trimester 2, 2014
presented in the report as appropriate.
competing arguments are presented in the report as appropriate.
Insightfully and succinctly discusses relevant limitations and implications.
Communicate information accurately (total marks available 5 out of 40)
(Score range 0-1.4) Extensive spelling and/or grammatical mistakes. Paraphrasing closely resembles a quote. Too much quoted material provided and presently incorrect.
Always uses basic English spoilt by errors that frequently impede meaning.
(Score range 1.5-2.4) Some spelling and/or grammatical mistakes. Paraphrasing uses too much of the authors’ own words. Too much quoted material provided, and some
presented incorrectly. Mostly uses basic English spoilt by errors
(Score range 2.5-2.9) Few spelling and/or grammatical errors. Paraphrasing correctly portrays other authors’ ideas in student’s own words. Too much quoted material
used, but presented correctly. Satisfactorily uses advanced English that conveys meaning with clarity and fluency.
(Score range 33.4) No spelling and/or grammatical errors. Paraphrasing correctly portrays other authors’ ideas in student’s own words. Too much quoted material used,
but presented correctly.
(Score range 3.53.9) No spelling and/or grammatical errors. Paraphrasing correctly portrays other authors’ ideas in student’s own words. Fewer quotations could be
used, but presented correctly. Competently uses advanced English
(Score range 4-5) No spelling and/or grammatical errors. Paraphrasing correctly portrays other authors’ ideas in student’s own words. Quotations used sparingly and
presented correctly. Consistently uses advanced English that skilfully
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MPA751 Assignment Trimester 2, 2014
that frequently impede meaning.
Competent use of English.
that expertly conveys meaning with clarity and fluency.
communicates meaning with clarity and fluency and is virtually error-free.
Refer to information sources accurately (total marks available 2 out of 40)
(Score range 0-0.5) References do not use the Harvard method correctly. In-text citations not utilised or inaccurate.
(Score range 0.6-0.9) An attempt to use the Harvard method has been made, but not entirely correct. In-text citations are mostly inaccurate.
(Score range 1-1.1) References provided under Harvard method are accurate in most cases. In-text citations are accurate in most cases.
(Score range 1.21.3) References provided under Harvard method are accurate (perhaps some minor errors). In-text citations are mostly accurate. 24-27
(Score range 1.41.5) References provided under Harvard method are accurate (perhaps some minor errors). In-text citations are accurate. 28-31
(Score range 1.62) References provided under Harvard method are accurate. In-text citations are accurate.
High Distinction (HD)