Select at least two key ratios you would use to evaluate

  

Questions

The following questions provide guidance for accounting analysis of your allocated company (Commonwealth Bank)

1) Select at least two key ratios you would use to evaluate each of the following aspects of your allocated company. Explain why you have selected the above ratios. You should refer to the company’s industry and nature of its business operation.

• Operating management

• Investment management

• Financing strategy

• Dividend policy

2) Conduct the cash flow analysis of your allocated company, i.e. evaluate the liquidity and the management of following activities

• Operating

• Investing activities,and

• Financing activities

3) Evaluate the company’s overall financial performance and financial position for the year ending 30 June 2016.

4) Make appropriate recommendations to the company’s executives. You should include the good news highlights, and explain plausible reasons for any bad news.

5) Identify connections between the company’s financial policies and its strategy as discussed in Report 1 Industry and Strategy Analysis. For example, does any financial policy support the company’s strategy in any way?