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I have question in regard to question 1 (a) (i) of Specimen 1. When it comes to analysis only, does it require me to assess whether a point I am trying to make is basically good or bad for the entity. If so, my analysis would be that for example, the stable political environment provides stability for the entity to operate smoothly and expand in order to growth their products/services. Is there any more information that I need to put in to make a valid point that is work 2 marks?
“From the information you have collated, draft a section of the consultancy report for the directors of DCS Company to include the following:
(i) An analysis of the industry and market which DCS Company is competing in, using an appropriate model. (15 marks)”
Analysis is really only worthwhile if it sets out both favourable and unfavourable points.
Some points are purely favourable (like a strong economy when you are trying to expand); some are purely unfavourable (like one of your products being responsible for someone’s death); some have both good and bad elements (like a lot of unused cash as this gives flexibility and security but is probably being eroded by inflation).
Ken Garrett wrote:Analysis is really only worthwhile if it sets out both favourable and unfavourable points.
Thanks, Ken. Very clear answer!
Here is an extract of my answer to the question:
“30% of the customers purchasing data communications from DCS are from outside Prydain where the currency is devaluing against Prydian’s dollar. The appreciation of Prydain’s dollar against the foreign currency renders the components exported by DCS more expensive compared to similar products sold in the devaluing current at the local market and less likely to attract customers from the country where the components are exported, negatively impacting revenue of DCS. The revenue decline by 6.1% from 2014 to 2015 may be due to the low competitiveness of DCS’s exported components in regard to price arising from the devaluation of the foreign currency against Prydain’s dollar.”
1. I drew from the facts of 30% foreign sales and devaluing currency and then made a point about sales decline. Is it the valid way the analysis should run to earn me 2 marks for this point?
2. I also drew the actual revenue decline rate from the financial report exhibit to back up my argument. Will that earn me 1 professional skill mark for evaluating?
Thanks
Tin Nguyen
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