Financial And Corporate Governance Analysis Assignment Sample

Accsys Technologies vs Alumasc Group: Financial & Corporate Governance Analysis

Introduction

The mission, fundamental beliefs, business strategy, and employees of Accsys are all focused on leaving a good and everlasting legacy. The Group has maintained a sharp focus on its goals and on the physical well-being as well as security of individuals throughout COVID-19's struggles. The priority given to sales efforts in establishing the local marketplace as a more substantial component of the total sales mix may be seen in the Benelux region's outstanding performance. The ratio analysis for the five financial years describes the financial and nonfinancial performance of Accsys Technologies plc and its competitors Alumasc Group plc (finance.yahoo.com, 2023). The company's corporate governance compliance is described impact on the reputation and brand of the company.

Section A

Financial and non-financial performance

Profitability Ratios

The profitability ratio has been computed for Accsys Technologies plc to identify the gross profit as well as net profit along with the sales. In order to, the gross profit ratio for Accsys Technologies plc has been calculated as 0.30, 0.33, 0.33, 0.34 and 0.34 for the five consecutive financial years. The return on capital employed has been calculated after finding out the capital employed and operating profit margin of the company which is approximately 0.02, 0.03, 0.03, 0.03 and 0.04 for the five consecutive financial years.

Efficiency Ratios

In order to calculate the current efficiency level of the company the efficiency ratio has been computed through the receivable days, payable days and inventory days. The disable days have been computed for Accsys Technologies plc as 0.24, 0.32, 0.31, 0.23 and 0.18 respectively for the five consecutive financial years.

Liquidity Ratios

The current ratio and quick ratio or Ace test ratio is considered by the liquidity ratios for the company. The current ratio has been calculated as 1.74, 1.71, 2.91, 2.75 and 2.67 respectively from the financial year 2022 to 2018. That indicates the company has excessive acids as compared to its liability and the 2.67% current ratio indicates the liability has gradually increased as compared to the other financial years.

Gearing Ratios

Effort from that the caring ratio has been computed by the debt and equity of the company which is calculated for the five consecutive financial years. The ratios are calculated as 0.16, 0.07, 0.22, 0.22 and 0.20 respectively from 2022 to 2018.

Comparison with the competitor

Profitability Ratios

Efficiency Ratios

Liquidity Ratios

Gearing Ratios

The 5 years ratio has been computed with the competitor Alumasc group plc while the ratios are compared current financial performance of two companies. The ratio analysis for the five financial years describes the financial and nonfinancial performance of Accsys Technologies plc and its competitors Alumasc Group plc. The gross profit ratio of Alumasc Group plc is 0.37, 0.36, 0.30, 0.31 and 0.31 for the five consecutive financial years that demonstrate profitability level of Alumasc Group plc is high as compared to Accsys Technologies plc. On the other hand, while calculating the efficiency ratio the receivable turnover days are high for Accsys Technologies Plc indicating this company is less time consuming which is approximately 0.24.

The company's debt and equity, which are measured over five consecutive financial years, were used to establish the caring ratio. From 2022 to 2018, the ratios are computed as 0.16, 0.07, 0.22, 0.22, and 0.20, respectively. The efficiency ratio has been calculated using the receivable days, payment days, and inventory days to determine the company's present degree of efficiency. For the five successive financial years, Accsys Technologies plc's disable days were calculated as 0.24, 0.32, 0.31, 0.23, and 0.18, respectively (finance.yahoo.com, 2023). The Group has remained laser-focused on its objectives, as well as on security and physical well-being.

Financial information by income statement, balance sheet, and cash flows

The total revenue has been evaluated as €12852, while the cost of revenue is approximately €84852. Due to the cost increases mentioned previously as well as deliberate measures to optimize procedures in light of COVID-19 issues manufacturing gross margin grew to 33.4% FY20: 30.0% (Lusardi, 2019). Due to the robust income produced by operational operations (€20.2 million) mentioned above and partially compensated by Capex expenditure of €11.7 million, the amount of net debt dropped by €13.0 million in the past twelve months to €12.2 million.

The right-of-use asset has been depreciated from the start date until the earlier of its useful life and the end of the duration of the lease. Depreciation is credited to the consolidating financial statements in this manner (De Bruijn and Antonides, 2022). The Group's its financial statements are still solid, and it ended the year in an excellent financial state.

The robust commercial cash flow that was produced by the Group and rigorous management of working capital during the year are reflected in the cash flow generated through operational activities of €20.2m, compared to €2.4m in the previous year.

Section B

Critically appraises a range of approaches to corporate governance, accountability and regulatory environments

Accsys embraced the QCA Corporate Governance Code in 2018 and currently has to provide information in accordance with this code on a comply-or-explain approach. Accsys' current Statements of Compliance according to the QCA Code explain how Accsys complies with the Code and therefore mitigates risk in combination with the information that is provided in this Report and Accounts. As cited by Shahab et al. (2019), directors get qualified advice on their responsibilities as part of their introduction process, either from the organization or from outside consultants. At Board conferences throughout the year, substantial duties and other organizational governance issues are considered.

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Legal and ethical issues

In order to make the instruction more readily available to everyone, the Group updated and re-established the online course for all employees in both the Dutch and English foreign languages in January 2021 (Ogunlusi and Obademi, 2021). The classes covered important areas of compliance with law and regulations, such as fighting corruption, corrupt behaviour and avoidance of taxes, slavery in modern times, and abuse of the market.

The company places the utmost importance on adhering to obligations in key ESG areas such as promoting the safety of people and mental health, ensuring ethical and impartial conduct, generating and distributing merchandise that is environmentally responsible and sourced ethically, and minimizing environmental impact (Harford et al. 2018).

Medium-term financial strategies

In September 2020, the Audit Committee began essential, complement addition to Board, with over 30 years of experience working in the chemical, medication, and process industries for fostering talent and incorporating ESG in initiatives to grow. Lombard Osier is a shareholder of Volantis, a multinational management of Assets Company that specializes in alternative putting money techniques (Grohmann, 2018). BGF is an investment firm that offers to extend British companies long-term equity finance so they may carry out their goals for the future.

The business has set up new international teams, functions, and approaches for technological innovation, and health and safety, and it has received extremely excellent results from the second annual Accsys Individuals stakeholder survey, which is a reflection of the several work streams aimed at enhancing employees' quality of life (Hastings and Mitchell, 2020). The goal of the medium-term fiscal strategy was to affect public expectations about anticipated inflation rates, help manage government expenditure, and establish a recognised, solid foundation for the federal government's fiscal discipline. The MTFS outlined goal values for the Public-sector borrowing requirement represented as a proportion of Gross domestic products as well as a target range for growth in terms of the Financial Supplied.

Conclusion

Based on the above discussion it can be concluded that the goal of Accsys is to establish a positive and enduring legacy, and this goal is reflected in the business's mission, core values, business plan, and workforce. Both the financial and nonfinancial accomplishments of Accsys Technologies plc and its rival Alumasc Group plc are examined in the ratio comparison for the five years of operation. The influence of a business's regulatory compliance on its brand and reputation is discussed. Alumasc Group Plc, an opponent, was used for calculating the 5-year ratio as the present economic health of each company was compared. Following the adoption of the QCA Corporate Responsibility Code in 2018, Accsys is now required to disclose data related to compliance with its provisions using the comply-or-explain method.

References

• Combrink, S. and Lew, C., 2020. Potential underdog bias, overconfidence and risk propensity in investor decision-making behavior. Journal of Behavioral Finance, 21(4), pp.337-351.
• De Bruijn, E.J. and Antonides, G., 2022. Poverty and economic decision making: a review of scarcity theory. Theory and Decision, 92(1), pp.5-37.
• Grohmann, A., 2018. Financial literacy and financial behavior: Evidence from the emerging Asian middle class. Pacific-Basin Finance Journal, 48, pp.129-143.
• Harford, J., Kecskés, A. and Mansi, S., 2018. Do long-term investors improve corporate decision making?. Journal of Corporate Finance, 50, pp.424-452.
• Hastings, J. and Mitchell, O.S., 2020. How financial literacy and impatience shape retirement wealth and investment behaviors. Journal of Pension Economics & Finance, 19(1), pp.1-20.
• Lusardi, A., 2019. Financial literacy and the need for financial education: evidence and implications. Swiss Journal of Economics and Statistics, 155(1), pp.1-8.
• Ogunlusi, O.E. and Obademi, O., 2021. The Impact of behavioural finance on investment decision-making: A study of selected investment banks in Nigeria. Global Business Review, 22(6), pp.1345-1361.
• Shahab, Y., Ye, Z., Riaz, Y. and Ntim, C.G., 2019. Individual's financial investment decision-making in reward-based crowdfunding: Evidence from China. Applied Economics Letters, 26(4), pp.261-266.

Website

• finance.yahoo.com, 2023, Annual report, Available at: https://finance.yahoo.com/quote/AXS.AS/financials?p=AXS.AS [Accessed on: 20^th August, 2023]
• finance.yahoo.com, 2023, Competitor, Available at: https://finance.yahoo.com/quote/0JL.SG/financials?p=0JL.SG [Accessed on: 20^th August, 2023]