General Queries Topic 8

@zeest - Please note this has should have been posted to the Forum - 'OBU Marker-speak - what your marker feedback really meant - as that is what you are asking about. I will move it in a day or two but PLEASE ensure that you select the most appropriate forum so that queries and answers are in a logical place for other students to refer to and benefit from. 1. Your marker wanted good explanations rather than comparisons in terms of mere figures (just talking about how much something has increased or decreased alone is not real analysis). Anyone can calculate figures but for the RAP you are expected to go beyond this. I suggest that you look at my article on Evaluation (if you haven't already read it) and also read the question on this in our FAQs both of these may be found via our homepage www.opentuition.com/obu so that you learn how to adopt the correct approach. Note: If you want to pass you do what the marker wants NOT what you want. 2. You failed the two elements of Assessment Criteria 6 i.e. both Information Gathering and Referencing. I do not understand your comments although the marker feedback would seem to mean the following. (a) Referencing: markers hate 'lazy referencing' this means they frown upon website addresses /URLs in the body of the report but the address is needed in the list so that the marker can access it. So as an example if referencing my article you would put (Open Tuition, n.d.) in the exact place in the text to show what you are referencing and then in your list you would put Open Tuition (n.d.) - Evaluation & Analysis, Open Tuition, https://opentuition.com/obu/tackle-evaluation-analysis-rap-part-1/ [Accessed 15 April 2015]. You must always have the same designation in the text as in the list so that the reader can find them e.g. it would not be permissible to put (Trephena, n.d.) in the text and then Open Tuition (n.d.) in the list as the reader would wonder what happened to the reference Trephena, n.d. and where the Open Tuition one was in the report as it would not be obvious they are the same (remember with electronic searching they can probably check these things easily). These are the sorts of things the marker meant by being 'consistent'. (b) Information Gathering - the marker probably felt that you were overly relying on the Annual reports for your evaluation which is too narrow for a balanced analysis. They want to see evidence that you have researched more widely by using articles and part of the proof of this is by referencing properly and showing that your work has used a broad range of sources. Markers will probably check some of your references to locate the original source and therefore you need to include sufficient information for them to do this. If they can't find them then it means the referencing is inadequate and likely to lead to another fail for referencing. I can only deduce from the moderator (senior marker) comments that you probably used Porters but only did 4 of the 5 forces. It looks as if you are approaching the word count limit and they are suggesting (as I do too) that you are better off ensuring that your evaluation and analysis is done in sufficient depth and editing out superfluous material and background details in Parts 1 & 2 to ensure that you comply with word count requirements. The business analysis is normally centered round the models and then leads on to the financial analysis which incorporates the ratio analysis but also should bring in the models as the two should be integrated - THEY DO NOT STAND ALONE as I explain in the Evaluation article (read or re-read the article as I cannot explain everything again here) Your query "do i need to do an investigation of business decisions and strategies resulting in changes of figures in ratio analysis i.e. financial analysis?" - Yes, absolutely this is what the marker and moderator think is currently missing and needs to be addressed. Read the CEO/chairman/directors reviews for the 3 year perios and look at what decisions they made and how these impacted on the performance. Also consider the effect of the SWOT & PESTLE factors on these decisions and results

@ahmedshariq - Absolutely not in Part 3! Copying and pasting heavily (even if in quotation marks and accompanied by appropriate references) is NOT the way to go unless you want to be failed for 'poor academic practice'. Learn to paraphrase and precis and use your own words to demonstrate that you understand what you are writing. A limited amount of direct citation is tolerated in Part 2 but generally it is not something markers like....

Hi, can someone please help me. For capital employed can I used (total assets minus current libilities ) formula. For my PBIT can I used PBT and add interest on it. Lastly the organizational I am doing most of my ratios results coming different compare to some other sites results. Will that be OK.

thankyou trephena, and with graphs, we have to make them in MS excel and then link to MS word or we can directly make it on MS word( though when making in word, data entry is done in excel windows). and in information pack it says ''Have you included the relevant pages of the company’s Financial Statements (if necessary)? (Please do not submit the entire document, copies of the relevant sections are adequate)'' can you elaborate how this has to be done? what is meant by copies of relevant section? like in directors report reason for variation in gross profit margin is told which i have mentioned in part3, so how do i take out the relevant section of annual report for referencing.

@hannah0275 I can only answer queries that I can understand and yours unfortunately are not clear. What do you mean by: "I have subtitled two types performances and using PESTEL analysis for business performance and ratios and revenue anaysis for financial performance. Is this good method to divide company’s financial and business performance in two sections?" ???? Have you read my article on Evaluation & analysis on our homepage www.opentuition.com/obu as I stress the importance of INTEGRATING factors from the SWOT and PESTLE when EXPLAINING the factors in the financial analysis? Again I do not understand the following commentary – I appreciate English may not be your first language but if I don’t understand it neither will a marker: ”Net profit margin was dropped from 3% in 2010 to -12% in 2013, by analysing this margin, we can assess the ability to expand the business through additional debt or other investments. However it does not look feasible” What are you trying to say here? It has to be clear. So the net profit fell from +3% to a net loss of 12% but after that I don’t know what you are saying. I know what you SHOULD be saying and that is explaining exactly why this company went from a profit to a loss situation – what factors produced this – bad management decisions (i.e. ones that were not based on the SWOT but should have been) e.g. attempting to enter a difficult market, loss of contracts, attempting to cut costs that impacted on quality that resulted in loss of sales overall? PESTLE factors – changes in the law regarding its operations making them more difficult/expensive? Obsolescence – the product is too dated in technological terms? Changes in consumer preferences (social factors)? You need to research the reasons. The SWOT & PESTLE factors often lie at the heart of what has gone on (hence the reason I talk in my article about integrating the two). The structure of the RAP is set out in the Information Pack which all students must familiarise themselves with this. A degree is about thinking and researching for yourself and working some things out for yourself too – this is not the mentor’s task The conclusion should be a summary of the principal findings i.e. the main points that influenced and impacted on the company’s performance and results over the last 3 years Regarding Referencing: the marker needs to be able to identify exactly what is being referenced so references go in the text unless the whole paragraph is being referred to. The rule is every idea or use of a source must be referenced each time including the graphs and charts If you are struggling through lack of guidance then I suggest that you look for a very good mentor (by the way I am not a mentor I am the Forum Moderator. We recommend The Learning Luminarium as they are very experienced and offer a variety of packages suited to different students’ needs). You will need to have a mentor to certify your work.

@Anna. The link you provided is not working.

I am doing Topic 8 for my RAP but there are only three company in the industry and only one is listed, as such the other are refusing to give me there information as in FS, can i go ahead and do the RAP without a Comparator?

You do not state which companies you are looking at but the choice is worldwide so you will have to use listed companies in another country if necessary. You must either use a comparator or bench mark against industry averages but you will have to supply proof of the industry averages i.e. a publicly available document that shows these. If you do not use a comparator/ industry average for Topic 8 you will failed by the marker. Comparisons should now be made over 3 years as only doing this for one year will mean you don't get higher than a C grade.

Thanks Traphena, am helped

@trephena, Could we still aim for an A grade if we base our analysis on unconsolidated financial statements of a group company? For example can I only use KLM's financial statements and compare it with British airways solely?

@trephena, DO you think its better to use the Porter Five forces model or the PESTEL model for a company which has a global presence. I will be using SWOT but i am not sure about what other model to use. Please guide me and if you have any other suggestion please share it too. Thanks

Interesting question as normally I think Porter's 5 forces is of limited use but I can see where you are coming from with this. Porter's may be better - it depends on the industry as a PESTLE could still be relevant. What you really need to do though in addition is read the CEO and directors reports for the last 4 years - yes 4 years - as the earliest one will give you some idea of the management plans for future years (the 3 you are looking at). Try to focus on the company strengths and opportunities and see how they have built on these if possible. Also even if not doing a full PESTLE consider how slowdowns or surges in the global economy may have impacted on results and how the fall in the global price of oil has affected things in the last year or two when looking at costs, revenues, turnover and margins. I always suggest starting Part 3 with the application of the models and trying to bring in the factors from them as much as possible in the financial analysis. (I have seen comments from markers going on about how management strategies should be discussed when evaluating results and that the models need to be better integrated into the work generally). Although you probably only can apply 2 models in your report because of word count limitations it may be worth looking at SWOT, PESTLE and Porters when drafting your ideas as they could possibly all help you do a better all round analysis.

Hi I have pick the Mobile telecommunication industry and my company is rogers.I have two ask two questions 1. My company issued its 2015 financial statements on 11 feb according to the Obu 2015-2016 packet we don't have to pick the year if the statements are issues less than 90 days before the start of the submission period.In my case it does fall in that category.Is it okay if i take years 12 13 14 ? 2.Since my company is a telecom company its sales consist of all other telecom products also asides mobile telecom. Where I have to show industry sales should i should sales related all telecom products or Mobile only as Mobile only sale aren't available. Hope someone helps.

need some help with the structuring ....my mentor is a dud ..... HELP !

@Bakhtawer 1. Yes you can analyse 2014, 2013 & 2012 year ended financial statements. 2. You can mention both mobile & all telecom products. I will recommend to highlight those items in industry which are your company's main product(s). In-case if no data available for only mobile then you can skip it in industry analysis and mention overall statistics. Regards, Hammad Ahmed Qureshi - OBU Registered Mentor.

@ember What help do you need Ember? Regards, Hammad Ahmed Qureshi – OBU Registered Mentor.

@trephena Thanks for the reply. I highly appreciate the feedback

@ember, First of all you should read Bsc info pack 2015/2016 and make a list of questions. I will be happy to answer you. If you have any specific question, feel free to ask me. Regards, Ali Farooq OBU Registered Mentor

Hello, i have selected glaxosmithkline for RAP. But i am confused whether i should choose its parent company based in UK or its subsidiary in India for evaluation . And if i choose subsidiary will i have to evaluate performance of parent company also. And second issue is about choosing the competitor company for benchmarking the performance i am planning to choose pfizer, is it the right choice. Thank you

@roop1234 Hi, Roop, Hope you are well! 1. If you choose UK Based Parent Company then you will have to look at its diverse performance over range of regions or countries where it control operations including India. If you chose Indian and you have standalone accounts available for Indian Operations only then you are not required to analyse parent company as their figures are not included in Indian company financial statements that you are analysing. 2. Company Pfizer is fine and also Glaxo as both meet criteria of OBU for topic 8 & 15 that they are Pharmaceutical companies. 4. Remember if you select UK company accounts for Glaxo operations then Pfizer accounts should also be of UK, if you use standalone accounts covering only Indian operations then you cannot compare UK Pfizer financial statements with Indian Glaxo. Comparison must be Like With Like. Regards, Hammad Ahmed Qureshi - OBU Registered Mentor.

roop1234 You will bring all these issues to the attention of your project mentor, He/she guides you step by step and develop your research skills. I suggest you to select companies from same countries because you will analyze Business and Financial performance over three year period. to keep balancing your report you will have to have reliable information from different sources to help you end your report within word limit. Both countries have different business and financial environment and how will you make sure your analysis is more meaningful and like with like, You can select any of the following companies for your research project Novartis Pfizer Roche Sanofi Merck & Co. Johnson & Johnson GlaxoSmithKline AstraZeneca Gilead Sciences Takeda AbbVie Keep in mind you can find different sources easily during your project, only annual report is not enough to prove your deep research. most of the information students access online. Does this sound good to you Regards, Ali Farooq OBU Registered Mentor

Thanks for replying @ahmed qureshi and @ali Farrooq . GSK pharmaceutical Ltd is subsidiary of GSK (UK). so can I select this company for RAP. Thank you

@roop1234 Yes, you can subject to information available on GSK Pharmaceutical Ltd. Regards, Hammad Ahmed Qureshi - OBU Registered Mentor.

@roop1234 you can select for your RAP. and make sure you will have sufficient information for both companies in India. If you do find more information in India then you should evaluate those annual reports otherwise select both companies in the UK. Regards, Ali Farooq BSC registered Mentor

Hello I am writing on pfizer co. I want to know when i calculate net profit margin ,do I need to take net profit attributable to pfizer or total net profit? Thank you

@aishaasad Both are fine, depending you what you are analyzing buti recommend total profit as it tells overall company's performance and amount invested in it. Regards, Hammad Ahmed Qureshi – OBU Registered Mentor.

In Pakistan, there is no listed Airline and mobile company, I am going with pharmaceutical industry and as per my knowledge there are only two company which are listed GlaxoSmithKline and Sanofi. Can i chose both of them, one as my main company and second for benchmarking purpose? Do i need to write my report in $ or local currency? One thing more, can i write in "reason for choosing this industry" as there are no mobile and airline listed company available in Pakistan?

@Handsome PIA is listed in Pakistan and yes you can go for GSK and Sanofi. You need to write your report in currency in which accounts are made. Yes, this is good idea and useful to write reason for selection of industry. Regards, Hammad Ahmed Qureshi – OBU Registered Mentor.

I wanted to clarify something, persons submitting for Period 32(May) can only do so for companies in the designated industries?

@hammadahmedqureshi Thank you for reply, there is no second company against PIA for ratio analyze available :/