[pallavirai]

@trephena. thankyou again, you’ve been of great help throughout the whole process. im extremely grateful 🙂

I had a small doubt, in the presentation, can we use the same graphs we used in the main RAP? also, do I have to reference the information in ppt as well?

also I am trying to cut down my word count, mainly from part 1 and 2 and wanted to know if industry overview is required under criteria? or can I cut it out of my RAP? If it is required, what are the main points to write under it, as I feel I might have gone into too much detail.

kind regards.

[pallavirai]

topic 8: SLS

for question 1, if I have had more than three meetings with my mentor (ive had four/five). can I write about each meeting separately, so should I only talk about three meetings only?

[pallavirai]

thankyou 🙂

[pallavirai]

thankyou @LearningLuminarium and @trephena

makes sense now 😀

although I would like advice on the ratios. I found it extremely hard to find enough information to barely make a good point or two on payables and receivables.

my company is Coca-Cola and comparator is PepsiCo. I have honestly gone through annual reports and online searches and found practically nothing. do you think this ratio is important to still keep in my RAP?

the ratios I have done are: horizontal analysis of revenue growth and ratio analysis on-GP, NP, ROCE, Inventory turnover, payables turnover, Receivable turnover, Current Ratio, Debt/Equity, PE ratio and EPS.

I feel like I have done a good analysis on the revenue growth, gp, np, d/e, eps and pe ratio. the rest im not too confident about.

do you think its a bad idea to remove payables and receivables turnover? because if I do then I would only have 8/9 ratios, doesn’t that seem too little? I know that its quality over quantity but it still makes me a little nervous. :\

do let me know what you suggest.
thankyou again x

[pallavirai]

@trephena
is it necessary to write on limitations in part 3 after doing the analysis?

i am aware of the limitations being covered in part 2 under info gathering and accounting/business techniques

under info gathering i talked about- time limitations and excessive info online

under accounting/business techniques i talked about- general limitations of ratio analysis, pest and swot.

but what i mean is, for example, something along the lines of not being able to find info on current ratio/payables/recievables due to info being little to none in annual reports or online, and it being internal to the company. therefore not being able to write much on this aspect. or something like that

is it required to do so? im already struggling with word count, but im worried about failing on the account of not self reflecting in the RAP. i have read that it is important to self reflect on both SLS and RAP.

please advise.

[pallavirai]

@trephena. I had a doubt in the depth of analysis that is required. here is an example

NET PROFIT MARGIN.
say for example net profit margin increased from 2011-2012.(will have a bar graph showing the results for 2011,12,13)
so my reasons are:
this is mainly due to operating charges reducing by this% and also effective tax rates decreasing. effective tax rates decreased due to increase in grants given and also increase in sales in emerging markets where the tax rate is lower than the standard 35% in US.

these benefits were partially offset by other income decreasing by this%, and therefore the increase is very marginal.

(insert comparator performance)

so my doubt is, is that amount of analysis enough, or do I need to mention why the other income decreased and why the operating charges reduced. because most of this information is hard to find.

[pallavirai]

@trephena thanks, I just came across a issue

this is my example:

Current Ratio:
(bar graph inserted showing years 2011, 2012, 2013 for company A and same for comparator B side by side)

the figures are: company A, 2011- 1.05, 2012-1.09, 2013- 1.13 Comparator: 0.96,1.10,1.24

I haven’t been able to find information for the changes in the ratio in either annual report or internet, I tried searching for differences in current assets, liabilities, inventory, cash etc.

the only reasons I found are earthquake in japan affecting inventory(not enough to make much of a movement though), cash management system changing,transferring some cash items into short term investments (but that wont affect current assets as its just a movement from one asset to another), and an asset for sale in 2012(sold off the same year).

in such cases where I cant find much of significant reasons, can I just mention these small differences and then talk about comparator performance. maybe include industry average? if not, please advice on what to do when sufficient info cant be found.

also is it necessary to do quick ratio as well if the trend is literally the same as current ratio?

just for a little background, my industry is beverage and my companies are the top two rivals in this industry

the ratios I have planned to perform analysis on are:
Profitability ratios:
gross profit margin
net profit margin
Return on capital employed

Liquidity Ratios
current ratio
quick ratio

Activity Ratios
recievable turnover days
payables turnover days
inventory turnover days

Leverage Ratios
interest cover
debt/equity ratio

Investor Ratios
average market price during year
dividend per share
earnings per share
price earnings ratio

also have performed horizontal analysis on revenue growth (total and segmental)

[pallavirai]

@trephena. thankyou for clearing my doubts. will go over part one and two to cut down on word count. that’s a good idea.

I do understand that there needs to be a link between business analysis and financial analysis but I want to ensure Im not wasting words by repeating the same thing again.

so for example, when im doing horizontal analysis of sales/revenue growth over the years of the company under financial analysis, I feel as though a lot of points I talked about in SWOT and PEST would apply here. so do I just say something along the lines of “as mentioned in SWOT/PEST this factor would affect the revenue” im not exactly sure on how to bring the points in without repeating myself.

on a slight tangent, i did read the OT article on evaluation and analysis of part 3 but im still a little confused towards the depth of analysis i would need to go into in say for example, ratio analysis due to word count restrictions.

what I’ve been doing for each ratio is to make a graph showing the trends and increases/decreases for the 3 years of the company and its comparator and talking about the reasons for the increase/decrease of the company over 3 years and then how the company has fared up against the comparator.

is that enough or do i need to go into more detail than that and talk about how the reasons came out to be etc?

kind regards

[pallavirai]

alright thankyou @trephena. As you Suggested,I have done SWOT and PESTLE analysis, but considering word count restrictions, would it be okay to stick to PEST instead of PESTLE, I do feel I have strong points for the four factors (PEST)?

for environmental analysis, I haven’t found much info on significant factors.

for legal, I did see bans being placed on junk food, namely, NY soda ban and mexico taxing junk food and beverages. but couldn’t that be placed under political?

regards

[pallavirai]

@trephena im doing my RAP on Coca-Cola Company (Global) and comapartor company PepsiCo.(Global)

so id like to know if your comment above saying that PESTLE analysis is better than Porters is for topic 8 or for @avianwill’s industry/company, as it is telecom so being technological, Pestle covers that area. if so, would PESTLE still be a more appropriate choice compared to porters in my case as well?

and is it true that Porters has to be performed on a SBU and cant be performed on the company as a whole, like in my instance KO?

do let me know what you think 🙂

[pallavirai]

@trephena i totally understand. (y)

[pallavirai]

@trephena thankyour for your reply, you’ve cleared my doubts 🙂

im new to the whole forum system and my notification went into junk mail, so I didn’t realize you replied, therefore created a new forum asking the same question. sorry!

now im struggling to find the forum to delete it as the questions are the same! *technologically challenged*

[pallavirai]

hello, I too am doing topic 8 for November 2014 submission and have a few doubts myself id like to clarify with @trephena . I just recently found the OBU forums here and am I excited to read around more.

my two companies are from the beverage industry and their year end is December 31. so I have taken 3 years as (2011, 2012, 2013) so here are my doubts.
-it is acceptable for me to take latest as 2013 and not 2014? as im assuming because year end is 31 December, my latest is 2013?
-my mentor asked me to take four years while calculating ratios so I discuss the variances of ratios as (2010-2011) (2011-2012) (2012-2013) in my RAP. is that accurate? I was afraid that I will get penalized for using four years instead of three. in my graphs however I have been asked to use 3 years figures. so I am a bit confused
-in part 1 of the RAP, what is the difference between objectives and research question? because under that I have just written for example; to perform financial analysis through ratios for company xx and compare it with company xx etc
-where and how do I include segmental revenue figures and industry averages?

thanks in advance x

[Author]

Posts