[Chandan]

Not yet…

[Chandan]

1) cashflow with 80% acquisition during year and joint venture

1)B) principles of decommissioning cost and if it’s against the definition of asset as per framework

1)C) benefits of environmental disclosures and ethical issues in overstating environmental performance

2) A) Why grant date for equity and reporting for liability, will expense change based on vesting conditions, why non-employees and employees treatment different, difference in definition of fair value as per IFRS 13 and IFRS 2)

2)B) CGU impairment where CV included current liabilities but value in use didn’t include

2)C) Fixed rate loan treatment (actively traded) so ftvpl and also they used internal wacc which is level 3 when interest rate publicly available

3) a) simple IFRS 15 of wind turbines + warranty and maintenance contract

3)b) fixed price contract to buy steel in foreign currency (embedded derivative)

3)c) Offshore wind farm was being built to test prototype so capitalise or not as per IAS 38, they got income during testing so how to account for it

[Chandan]

What’s the underlying in this case? The dinar?

[Chandan]

Okay sir.

Thanks a lot for the advice and for patiently solving all my doubts on a prompt basis.

Really greatful! Means a lot.. 🙂

[Chandan]

Embedded derivative is basically when a contract has both a derivative element and non-derivative item I believe?

And derivative is when it’s value changes according to the value of an underlying

[Chandan]

IFRS 9 suggests that when the financial asset in question is a receivable or contract asset (and)

There is no significant financing component,

The credit losses need not be assessed for under normal 12 month/lifetime expected/actual but there can be a simplification and the losses can always be calculated as ‘lifetime expected losses’

But if there’s significant financing component,

Then regular test to see where it fits in..

What’s the logic behind the simplification only with regards to when there’s no significant financing component

[Chandan]

There’s no specific heading ‘interest income’ in the statement of p&l but I feel it’s under other income?

[Chandan]

Yeah but won’t we take the 8% to interest income in the p&l?

Dr financial asset
Cr interest income

[Chandan]

Hey,

Meanwhile I just asked my friends the same question and one of them came up with this:

Recycle :
H- hedging
E- exchange – translation g/l on subs

Don’t recycle :
A -actuarial – pension remeasurement
P – PPE revaluations
S – strategic equity- FVOCI financial assets g/l

Can you please confirm the accuracy? And weigh in with elaboration or further comments?

It makes a nice mnemonic ‘HEAPS’.. 😛

[Chandan]

Finally submitted the project!

Fingers crossed for the results…

Thanks a lot to @trephena and everyone else who helped and supported me throughout answering my queries promptly and giving valuable guidance.

Now one thing I’m worried about is, the number of slides in my PPT is 19. Is that ok or should I be concerned? I know I can’t do anything now.. but still..

[Chandan]

Hello,

I am worried about my word count of RAP..

Without in text citations, my entire RAP’s word count is 8837 words.

How do I reduce my word count? Can I cut down on any ratio?

PART A is of 895 words
PART B is of 2112 words
PART C is of 5830 words

I did ratio analysis, SWOT and PESTEL

Financial Analysis:

Revenue analysis
Operating Profit
Asset turnover
ROCE
Current ratio
Gearing ratio
Interest Cover
EPS
DPS
Receivable days
Payable days

I understand receivable days and payable aren’t that relevant so I have kept them very short.. barely 300 words both of them together..

I was considering removing interest cover.. is that a good decision? it[ll reduce 500 words… any other way in which I can trim the word count?

[Chandan]

@trephena, thanks a lot for your valuable feedback..

I have worked on SWOT and PESTEL both.. but it is my mentor who is insisting to just focus on just one and elaborate it more rather than just listing out the points in short of both SWOT and PEST.. so wanted second opinion…

Yes I just read your article on how not considering the wider environment caused failure..

[Chandan]

@Learning Lumarium, My mentor has advised me to do only SWOT and elaborate it more rather than doing SWOT and PESTLE both.. do you think its risky to just include SWOT

[Chandan]

Hello Learning Lumarium/ Trephanie

I decided to make use of SWOT and PESTEL for my business analysis but I am concerned about conflicting points between SWOT and PESTEL and how do I deal with them? Also do yo advise any other model to use in liaison with SWOT apart from PESTEL?

Thanks in regards

[Chandan]

@trephena, I need your advice on this..

If I compare Emirates with Singapore Airlines Group results, the issue is that the group consists of two subsidiary which are low cost carriers so I fear that it’ll not be a like for like comparison

If I compare Emirates with results of only Singapore Air parent company’s results then I will be missing out on comparison of cargo revenue as Singapore Airlines’ freight operations are managed by a different subsidiary, ‘SIA Cargo’.

I thought of adding SIA Cargo’s results to the results of Singapore Air and then do the analysis but only the individual P&L of SIA Cargo is available and not the balance sheet..

What do I do???

@ch305 said:
I have 2 papers to give in June along with the project.. :/

So I think switching over wouldn’t be wise now..

So I have chosen Singapore Airlines but not sure if I should compare Singapore Airlines Group with Emirates or just the Singapore Airlines parent company..

Singapore Airlines Group consists of 4 airlines out of which two are low cost

Singapore Airlines parent company is all premium but doesn’t take into account cargo.. cargo revenue is reported under separate subsidiary SIA cargo

[Chandan]

I have 2 papers to give in June along with the project.. :/

So I think switching over wouldn’t be wise now..

So I have chosen Singapore Airlines but not sure if I should compare Singapore Airlines Group with Emirates or just the Singapore Airlines parent company..

Singapore Airlines Group consists of 4 airlines out of which two are low cost

Singapore Airlines parent company is all premium but doesn’t take into account cargo.. cargo revenue is reported under separate subsidiary SIA cargo

@ehsanshah said:
Still one month, it is possible if you have no other time consuming commitments.

[Chandan]

Anyone using Singapore Airlines as competitor here against Emirates?

The financial statements available online of Singapore Airlines Group in the annual reports has consolidated financial statements consisting of Singapore Air, Silk Air, Scoot and Tiger Air.

Tiger Air and Scoot are budget airlines so will it affect comparison with a all-premium airline like Emirates? I am not able to find the individual financial statements of just Singapore Air..

@trephena could you please advise as well

[Chandan]

Should I show the KPIs such as Load factor and yields separately in the financial analysis or should use them for explanation of changes in profitability/revenue?

[Chandan]

@trephena, Thanks a lot for the reassurance. I was panicking about that.

@ehsan, Singapore Airlines’ consolidated statements available consist of Singapore Airline, Silk Air, Tiger Air and Scoot and the latter two are budget carriers. Won’t it skew my comparison with Emirates which is a premium carrier? Is there any possibility of getting the individual statements of Singapore Air only?

Also, the revenue breakup of Emirates is based on operations such as passenger, cargo, sale of goods etc but the revenue breakup of Singapore Airlines is based on how much revenue was from which subsidiary

@ehsanshah said:
No, I chose Qantas and Virgin Australia.

For Emirates – Singapore Airline is best rival based on available information !

[Chandan]

In relation to below.. I see many problems with Emirates… Is the time left sufficient for the analysis if I move over to another company or topic perhaps?

@ch305 said:
I can see there are many doing Emirates like me here but has anyone realized that Emirates is not listed and there will be issues in calculating the shareholder ratios?

If you type Emirates share price on Google you will find the share listing details and everything but the ‘Emirates’ that is listed is basically the Emirates bank listed under the name ‘Emirates NBD PJSC’ and not the Emirates Airlines.

What do I do?!?!?! I just realized this..

https://www.bloomberg.com/quote/EMIRATES:UH

[Chandan]

I can see there are many doing Emirates like me here but has anyone realized that Emirates is not listed and there will be issues in calculating the shareholder ratios?

If you type Emirates share price on Google you will find the share listing details and everything but the ‘Emirates’ that is listed is basically the Emirates bank listed under the name ‘Emirates NBD PJSC’ and not the Emirates Airlines.

What do I do?!?!?! I just realized this..

https://www.bloomberg.com/quote/EMIRATES:UH

[Chandan]

I am also confused about which years to compare.

The year ends which are to be taken for May 17 submission are y.e. 2014,2015 and 2016.

So the growth comparisions should be only between 2014 and 2015, 2015 and 2016?

Or do I need to consider growth from y.e. 2013 to y.e. 2014 as well?

[Chandan]

I am doing an analysis on Emirates Airlines.

Could anyone please advise on the appropriate comparator?

There are issues obtaining the annual reports of Etihad and Qatar as they both aren’t listed.

American airlines have year end of December whereas Emirates has an year end of March.

I was thinking of Singapore Airlines but Singapore airlines group consists of both full service airlines such as Silk Air and low cost airlines such as Tiger airline as a part of the group so I am worried if analysis will be appropriate?

I am panicking about this from almost a month. Please help.

[Chandan]

Thanks @trephena

@trephena said:
@Chandon – Normally the financial statements are in the Investor Relations section of a company’s website. With private companies they are not obliged to make all of their information public and this can be an issue. However regarding EPS it would be fine to have this for just one company while explaining why you don’t have it for the other. You do however need some comparable information for most of your analysis.

Apply your models and as you introduce the ratio analysis: start with a discussion of revenue and the importance of the KPIs (load factor followed by the ‘ASK’ [mile] ratios). You should then be able to link these and the factors from the models to profitability (however you need to find proper reasons why there have been increases/decreases in passenger numbers etc.). Aircraft utilisation is also a measure of efficiency and can be discussed alongside asset utilisation if the company buys its own aircraft

[Chandan]

@trephena

Could you please advise with regards to the quoted post and other queries listed below:

* I have seen your previous replies and as per that i have calculated the industry KPIs as well like load factor and revenue per passenger mile. Will this form part of the financial analysis or business analysis?

* Even if i manage to get the financials of Qatar, it’s not listed so I’ll not be able to compare Emirates’ P/E ratio.. should i bin the ratio altogether then or what do i do?

@ch305 said:
I have just started with the RAP and have chosen Emirates and Qatar but the issue is I am able to find only the latest annual reports and statements of Qatar i.e. of 2015 – 16 and not the ones before. Could anyone please help me in finding the previous 2 years’ annual reports and statements or advise me which other company would be suitable to compare with Emirates?

[Author]

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