ACCAP3考试模拟真题答案Word下载.docx

1、5% and a net profit margin of 82%. This has declined steadily over the period under consideration. The figures for2009 were 200% and 47% and for 2011, 179% and 29% respectively. There has been a general failure to keep costsunder control over this period. Sales have fallen by $150m in four years alm

2、ost an 18% decrease. In contrast the cost ofsales has decreased by only $75m, a decrease of about 115%. This probably reflects the problem of reducing labour to reactto lower demand, particularly in a country where generous redundancy payments are enforced by law and in an organisationwhich sees the

3、 employment of local labour as one of its objectives. The Return on Capital Employed （ROCE） has droppedsubstantially, from 2414% in 2007 to 645% in 2011.Gearing: The capital structure of the company has changed significantly in the last four years and this is probably of greatconcern to the family w

4、ho are averse to risk and borrowing. Long-term borrowings have increased dramatically and retainedearnings are falling, reflecting higher dividends being taken by the family. Traditionally, the company has been very lowgeared, reflecting the social values of the family. The gearing ratio was only 69

5、% in 2007, but has risen to over 225% in2011. During this period, retained profit has fallen and an increasing number of long-term loans have been taken out tofinance activities. Overall, gearing may still appear quite low and indeed this is probably the view of the senior managementof the company.

6、However, the speed of these funding changes is a concern, particularly when trade receivables and tradepayables are considered.One of the values held by the family is the importance of paying suppliers on time. In Arnland, goods are normally suppliedon 30 days credit. In 2007, Hammond Shoes, on aver

7、age, exceeded this target, paying on 28 days. However by 2009 thisvalue had risen to 43 days and by 2011 to 63 days. During the same period, trade receivables, from the selected dataprovided, appear to have come down slightly （from 3865 days in 2007 to 3650 days in 2011）. It is difficult to escape t

8、heconclusion that Hammond Shoes is increasingly using suppliers as a source of free credit on top of the loans they have takenfrom the banks. Financing costs have risen significantly over the last four years, affecting profits and also causing the interestcover ratio to fall dramatically from 14 to

9、133.The financial analysis essentially supports the descriptive analysis provided by the business analysts. Profits are falling, withthe firm unable to cut costs sufficiently quickly. The company is increasingly dependent on external finance which is likely tocause disquiet amongst the owning family

10、 （on ethical grounds） and may concern suppliers.Investment analysis:The two scenarios developed by the senior managers also reflect the pessimism of the company. There seems to be universalacceptance that in the next three years the company will still experience low sales even after the company inve

11、sts in the newproduction facilities. Beyond that, managers only see a 30% chance of higher sales resulting and this depends uponfavourable changes in the business environment.For both scenarios, the net benefits of the first three years are $5m per year, giving a total of $15m.For the next three yea

12、rs, managers suggest that there is a 07 chance of continuing low demand, leading to net benefitsstaying at $5m per year, giving a further benefit of $15m total, with an expected value of $105 （$15m x 07）. Higherdemand would lead to net benefits of $10m per year, providing a total of $30m, but with a

13、n expected value of only $9m（$30m x 03）.Thus the expected benefits of the project are only $345 （$15m + $105m + $9m）, which is below the proposed investmentof $375m. Only if the second scenario materialises after three years will the investment （in broad terms） have been justified.This scenario woul

14、d return $45m.However, it has to be recognised that the projection only covers the first six years of the new production facilities. The factorywas last updated twenty years ago and so it seems reasonable to expect net profits to continue for many years after the sixyears explicitly considered in th

15、e scenario, but it must be recognised that predicting net benefits beyond that horizon becomesincreasingly unreliable and subjective.（b） This question does not require the candidate to use a specific framework for generating strategic options. A number ofpossibilities exist. The TOWS matrix, the str

16、ategy clock and the Ansoff matrix all come to mind. Each of these frameworks hassufficient facets to generate the number of options or directions required to gain the marks on offer. For the purpose of thisanswer, the TOWS matrix is used, because it fits so well with the SWOT analysis produced by th

17、e consultants. However, thefocus is on the options generated, not the framework itself and so other frameworks may be as appropriate.The TOWS matrix is a way of generating directions from an understanding of the organisations strategic position. It buildsdirectly on the work of the SWOT with each qu

18、adrant identifying options that address a different combination of the internalfactors （strengths and weaknesses） and external factors （opportunities and threats）.Taking each quadrant in turn:SO using strengths to take advantage of opportunities. A number of possible options might be considered here

19、. HammondShoes retail expertise is an acknowledged strength of the company, and it may be possible to use it to take advantage of theopportunities provided by increased consumer spending and consumerism in Arnland. Two possible options come to mind.Firstly, the company could consider selling competi

20、ng products or complementary goods in its retail shops. This would giveconsumers a greater choice of products and allow Hammond Shoes to reap some of the profit margins enjoyed by itscompetitors. Given the companys acknowledged retail expertise, this option should help preserve the long-term future

21、of theshops.Secondly, the increasing appetite of the public for safe, car-free shopping from a variety of shops might suggest thedevelopment of retail villages on the land that Hammond Shoes have, both in Petatown and in the, now disused, factory inthe north of the country. This option would combine

22、 the twin strengths of retail experience and the availability of land ownedby the company, to provide consumers with an experience they increasingly seek and value. The fact that only two sites areavailable in towns where there are currently no Hammond Shoes retail shops means that there is no appar

23、ent reason whythe creation of the retail villages should not be combined with the diversification of the products offered in the retail stores.The software expertise of the companys information systems department can also be used to fulfil consumers desire forincreased purchases over the Internet. U

24、p to now this software expertise has been mainly used to develop in-house productionand retail systems which are acknowledged as being amongst the best in the industry. This expertise might be used to developan innovative e-commerce site. This, of course, also opens up the possibility of sales outsi

25、de Arnland, something that isunlikely at the moment, given that all the retail shops are within the country.WO options that take advantage of opportunities by overcoming weaknesses. To some extent this option contains theapproach suggested by the Board, upgrading production machinery. This is addres

26、sing a known weakness （out-datedproduction facilities）, simultaneously tackling another weakness, the cost of production. Here the approach is to reduce unitcost by improving productivity and reducing energy costs through the use of modern production equipment. The Boardperceives that overcoming the

27、se weaknesses will allow the company to continue to compete in the market they are familiarwith.Reducing energy costs might also be used to appeal to the increasing number of green consumers of Arnland who take intoaccount ethical issues when making purchasing decisions. The business analysts have i

28、dentified these savings as anopportunity in their SWOT analysis. They should be attracted to a product that has been produced using an energy efficientprocess, and has not travelled thousands of kilometres （using energy consuming boats, road transport and trains）. At the timeof writing, there is an

29、increased interest in measuring product miles or kilometres, a term used to assess the environmentalimpact of delivering a product from its point of production to its point of sale. Although the measures are controversial, thisneed not necessarily concern the messages put out by Hammond Shoes marketing department.Hammond Shoes might also use the negative impact of television programmes showing the use of cheap and exploited labourin the production of goods in Orietaria as part of their marketing message. Although the consultants hav