MANAGING FINANCIAL RESOURCES

Managing Financial Resources and Decision

Table of Content

INTRODUCTION1

DISCUSSION1

Task 1: Sources of Finance1

1.1Identify the sources of the finance available to a company in general1

Internal source of Funds2

External source of funds2

1.2Identify and analyze how the assets of Qatar National W.L.L have been financed for the year of 2007 and 20083

Task 2: Working Capital Management4

2.1Explain the Working Capital Management4

2.2Identify the Net Working capital of the above company for the year of 2008 and 2009.5

2.3Analyse the working capital in terms of liquidity, profitability and risk taking ability6

a)Analysis - Liquidity7

b)Analysis - Profitability7

c)Analysis - Risk7

d)Summary of Working capital management8

Task 3: Investment Appraisal8

3.1Explain the importance of investment appraisal8

3.2Explain the available techniques to appraise an investment9

3.3Evaluate each technique from the investor's point of view10

3.4Identify the Net Present Value of the above project11

Task 4: Ratio Analysis12

4.1Ratios of Lake of Egypt Marina12

4.2Analyze the company performance over the period based on the findings above12

Task 5: Financial Statement14

5.1The Balance sheet as at 31st December 201114

5.2Income Statement for the year ended 201115

CONCLUSION16

REFERENCES17

APPENDIX18

Formulas18

Managing Financial Resources and Decision

Introduction

Money has the tendency to rotate the world. Each company constantly face the financial management problems and for that manager attempt to identify the solutions that will assist in business to be successful in future. Main financial decisions generally faced by manager are related to the financial investments. The investment and financial decision taken by the company are based on the techniques which ensure that particular investment will be profitability. This paper will focus on the Managing Financial Resources and Decision in which different Sources of Finance, Working Capital Management, Investment Appraisal, Ratio Analysis and Financial Statement.

Discussion

Financial management can improve the overall performance regardless of the size of the company, from the daily management of cash flows to the annual financial results. Business Management considers those decisions that will reduce the cost and increase the profitability of the company.

Task 1: Sources of Finance

Identify the sources of the finance available to a company in general

Companies obtain finance for various reasons. The traditional need that may arise for a company is due to the capital asset acquirement i.e. purchasing new machine or equipments, construction of new projects or department etc. new product development which is very costly such things are financed internally while capital for acquiring machinery or equipment, company opt for external financing. Currently, due to the tight liquidity, the preference of many companies is toward short term financing i.e. overdraft or in form of loans so that they can furnish a cash flow cushion.

Hence, there are two type of financing available for a company. One is internal financing in which money comes from inside the company from the retain earning while external financing is concern with the issuance of debt or equity in order to finance operations of the company (Goel, R. K. and Hasan, I. 2004, pp. 12).

Internal source of Funds

The following are the internal source of funds:

Personal saving of the people involved in the business

Retained Earnings of the company i.e. is the undistributed revenue of the company

Working Capital ...