The analysis by Steel Tube division of Engineering Products Plc Assignment

The analysis by Steel Tube division of Engineering Products Plc accountant - Assignment Example Center of discussion in this paper is a financial analyst for Steel Tube division of Engineering Products Plc named Roger Davis. He is having a tough time convincing the management for a project proposal. The analysis by his accountant and the additional information obtained from other sources has added to his woes. Roger Davis needs to convince his managing director about the viability of a new proposal for computer numerically controlled (CNC) milling machine. The MD is not ready to spend money on the project unless it can start yielding profits within 3 years. However, the accountant’s analysis shows an overall loss for the project over the next 4 years. It won’t be prudent to expect much from the project after this period. Roger has collected a lot of additional information as well. But he has not been able to justify the viability of the project with given information. Most of the information available to Roger seems relevant at first sight. However, the consultant charges of  £18,000 have already been paid by the company. Hence, they would not make much difference to the investment decision. Also acquiring opening stock at the beginning of the year rather than considering the same at year end would have minimal impact on the decision (the impact due to time value of money would be very small as compared to other numbers) and hence should be neglected for analysis. In addition there are pieces of information which don not directly reflect the performance of the project and must be excluded for a fair evaluation. They would be discussed in greater detail in section 5. 4. Cash flow Analysis using all additional information The accountant’s analysis was quite limited. Therefore, additional information collected by Roger needs to be incorporated in the financial analysis (Johnson, Derek). The same has been done in Table 4.1. The methodology for the same is discussed here. Table 4.1: Cash Flow Analysis using Accountant’s Analysis a nd Additional Information    Year       0 1 2 3 4 Total Sales    400.00 600.00 800.00 600.00    Cost of Sales    180.00 300.00 380.00 300.00    Labour Cost    80.00 120.00 120.00 80.00    Revised Other production expenses    64.00 66.00 68.00 84.00    Depreciation    40.00 40.00 40.00 40.00    Administrative Overhead    54.00 76.00 74.00 74.00    Interest on loans    22.00 22.00 22.00 22.00    Total Cost    440.00 624.00 704.00 600.00    PBT    -40.00 -24.00 96.00 0.00    PBDT    0.00 16.00 136.00 40.00    Depreciation for Tax purpose    60.00 45.00 33.75 25.31    Cumulative Depreciation for Tax purpose    60.00 105.00 138.75 164.06    PBT (for Tax purpose)    -60.00 -29.00 102.25 14.69    PAT (for Tax purpose)    -42.00 -20.30 71.58 10.28    Net profit (for company)    -62.00 -25.30 77.83 24.97    Scrap sales 20.00 0.00 0.00 0.00 20.00    Cash benefits due to sell-off of existing machine 0.00 18.00 18.00 18.00 18.0 0    Additional advertising expenses -40.00 -8.00 -8.00 -8.00 -8.00    Consultant expenses -18.00 0.00 0.00 0.00 0.00    Reduction in sales of competing products    -60.00 -60.00 -60.00 -60.00    Net cash flow -38.00 -112.00 -75.30 27.83 -5.03

The Workplace Relations Amendment Essay Example | Topics and Well Written Essays - 3250 words

The Workplace Relations Amendment - Essay Example (Parliament of Australia, 2006) The bill has caused strong reactions from numerous stakeholders. A substantial number of employer association affirmed their support for the Bill. However, there are also some trade unions and labor associations that strongly campaigned against the Act. Some of these groups oppose the way the Bill was passed in parliament; they feel that most of them were not adequately informed about it. These arguments were brought forward by opposition members of parliament who argued that members of the Liberal National Coalition did not give the Bill enough time. However, there are intentions to change many parts of the Work Choices legislation as asserted by Prime Minister Kevin Rudd. He represents the Labor party which may have won the election due to this issue. Numerous opposition parliamentarians were opposed to the legislation. This affected the way the matter was handled in parliament. These opposition members; who represented the Labor party, claimed that there were inadequate copies of the Bill. Consequently, they took part in numerous campaigns against the Bill on the day it was introduced. Matters became more heated when parliamentarians were required to question the Bill; Labor party members were seen interrupting remarks made by proponents of the Bill and a substantial number had to be removed from the House. ... This was quite a hurried arrangement. As if that was not enough, the Bill was passed exactly a month after it had been introduced. Minister at that time argued that the hurried response was to avoid introduction of the legislation during an election year. However, this undermined the need for consensus. In order for pieces of legislation to gain acceptance by the public, they need to be thoroughly scrutinized. When this is not done effectively, some problems may arise in the future especially during implementation. The role of the Australian Industrial Relations Commission (AIRC) The AIRC has been in charge of unfair dismissals and terminations too. However, the enactment of the Work Choices legislation has reduced their efforts in this regard. For example, employees who wish to make a claim to the Commission about unfair dismissals are expected to do so within a period of twenty one days fork the time their employment was terminated. This means that employees are placed at a disadvantage because twenty one days are not enough. In light of this, the legislation places more power in the hands of the employer rather than the employee since most of them may not be bale to meet this new deadline. The Australian Industrial Relations Commission is expected to approve extensions of claim periods. However, it has been shown that most of the time, these extensions are rarely granted. Part of the reason for this could be that there is a fee for application and most employees may not be able to afford this. Another reason for this observation could be the long procedures that employees have to pass through before they are granted extensions. The Work Relations Amendment has created long procedures;