BUS 328: Business Finance
Group Project 1: Financial Statement Analysis of a Real Company
Objective:
The aim of this project is for students to apply financial analysis techniques
to evaluate the performance and financial health of a real-world company.
Students will work in groups, selecting a publicly traded company, analyzing
its financial statements, and providing insights on the company's financial
condition, profitability, liquidity, and investment potential.
Summit the Group Report (Week 4):
Task: Consolidate all analyses into a comprehensive Financial
Statement Analysis Report (3000 words – exclude tables and
figures captions). This report should include:
o Overview of the company and industry
o Detailed financial statement analysis (ratios, horizontal & vertical
analysis, cash flow analysis)
o Comparative analysis and industry benchmarking
o Conclusion and investment-management recommendation.
Deliverable: Final written report and submitted for grading, excel file
Assessment Criteria:
Report (80%): Quality and depth of financial analysis, coherence,
clarity of explanations, and use of data.
Peer Evaluation (10%): Individual contributions within the group.
Timeliness (10%): Submission of deliverables on time.
Additional Guidelines:
Each group must cite all sources and ensure the accuracy of financial
data.
Use financial analysis software/tools (e.g., Excel, Power BI, or similar)
to visualize trends and comparisons.
BUS 328: Business Finance
PROJECT STRUCTURE AND DELIVERABLES:
1. Group Formation & Company Selection (Week 2):
Group Size: 4-5 students per group.
Task: Each group will select a publicly traded company (either
domestic or international). The company must have at least three
years of publicly available financial statements.
o What does the company do, and in which industry does it
operate?
o What are the key products or services the company provides?
o What are the company’s key markets (domestic, international)?
o What are the major factors impacting the company's business
(e.g., economic, regulatory, geopolitical)?
o Why are these companies chosen for analysis (e.g., industry
leader, interesting growth potential, financial distress)?
Deliverable: A brief introduction about the company, its industry, and
why the group chose it. Submit the company’s name for approval.
2. Collection of Financial Data (Week 2):
Task: Collect the company's Income Statement, Balance Sheet,
and Cash Flow Statement for the last three years. The data must be
sourced from reliable platforms like the company’s official website,
annual reports, or databases such as Yahoo Finance, Bloomberg, or
Vietstocks, CafeF, etc.
o What accounting standards does the company follow (e.g., IFRS,
GAAP)?
o Are there any notable changes or trends in the major figures
(e.g., revenue, profit, total assets)?
Deliverable: Submit to Moodle the collected financial statements for
verification and analysis approval.
3. Financial Ratio Analysis (Week 2-3):
Task: Conduct a detailed ratio analysis using the financial
statements. Key ratios to be analyzed include:
BUS 328: Business Finance
o Liquidity Ratios (e.g., Current Ratio, Quick Ratio)
Does the company have enough current assets to cover its
current liabilities? (Current Ratio, Quick Ratio)
Is the company facing liquidity issues?
o Profitability Ratios (e.g., Gross Profit Margin, Net Profit Margin,
Return on Assets, Return on Equity)
How profitable is the company in terms of generating
income from its operations? (Gross Profit Margin, Net Profit
Margin)
How efficiently does the company use its assets and equity
to generate profits? (Return on Assets, Return on Equity)
o Efficiency Ratios (e.g., Asset Turnover, Inventory Turnover)
How well does the company manage its inventory and use
its assets? (Inventory Turnover, Asset Turnover)
o Leverage Ratios (e.g., Debt to Equity, Interest Coverage Ratio)
How heavily is the company relying on debt for financing?
(Debt-to-Equity Ratio)
Is the company able to meet its obligations of interest?
(Interest Coverage Ratio)
o Market Ratios (e.g., Price to Earnings, Price to Book)
How is the company valued by investors? (Price-to-
Earnings Ratio, Price-to-Book Ratio)
Deliverable: Write a section in the report summarizing the ratio
analysis with detailed interpretations for each ratio.
4. Horizontal and Vertical Analysis (Week 3):
Task: Perform Horizontal Analysis (year-over-year growth in key
financial statement items) and Vertical Analysis (common-size
financial statements).
o How has the company’s financial performance evolved over
time? (Identify trends in revenue, profits, and key balance sheet
items over the last three years.)
BUS 328: Business Finance
o Are there any significant growth patterns or declines?
o What portion of the company’s revenue is allocated to various
expenses?
o Are there any changes in the company’s cost structure (e.g.,
COGS, operating expenses)?
o How does the structure of the balance sheet compare across
years (proportions of assets, liabilities, and equity)?
Deliverable: Write a section in the report summarizing horizontal and
vertical analyses, including trends over the past three years.
5. Comparative Analysis & Industry Benchmarking (Week 3):
Task: Compare the company’s performance against at least two direct
competitors or industry averages.
o How does the company’s financial health compare to its peers?
Are its liquidity, profitability, and efficiency ratios in line
with industry standards?
Is the company’s debt level higher or lower than its
competitors?
Does the company have a competitive advantage in
profitability or operational efficiency?
o What external factors (e.g., economic conditions, market trends)
may explain differences between the company and its
competitors?
Deliverable: A comparative analysis section in the report, highlighting
where the company stands in terms of financial health, including
comparisons with industry averages, with their competitors.
