Intended learning outcomes:
1. Evaluate the performance of a company using
various financial analytical tools.
2. Analyse different patterns of cost behaviour and apply cost-volume-profit analysis to business decisions.
3. Select and apply investment appraisal techniques appropriately.
4. Evaluate the performance of business units using both financial and non-financial measures.
Suan Investments, a leading investment services company has employed you to evaluate the financial performance of two companies listed in Muscat Securities Market (MSM). You are supposed to consider the following instructions to complete this task and advise your client on which companies he has to invest.
General Instructions for answering this question:
a. Select any two companies from the same industry or sector. Remember that your client is not interested in Banking and Investment companies.
b. Collect the companies’ annual financial reports for two consecutive years. Avoid using quarterly statements. You may refer to http://www.msm.gov.om/ or the company websites for this.
c. Use the financial statements and additional information collected to complete the below mentioned tasks.
d. Do not forget to provide references for the data collected (use Coventry Harvard style of referencing).
1. Compute two of related ratios to comment on the below of the chosen companies:
a. Operational Efficiency – 2 marks
b. Liquidity -2 marks
c. Profitability -2 marks
d. Capital Structure/ Gearing -2 marks
e. Market Ratios – 2 marks