Analyse the financial statements of the two companies Shell and BG Group in the year prior to the transaction, and the consolidated financial statements in each of the 3 years after consolidation using: A. 3 profitability ratios B. 2 solvency ratios C. 3 efficiency ratios D. 3 shareholder ratios E. 3 capital structure ratios

The chosen company merger for these questions: Shell and BG Group

Question1. Ratioanalysis (30marks)
Analyse the financial statements of the two companies Shell and BG Group in the year prior to the transaction, and the consolidated financial statements in each of the 3 years after consolidation using:
A. 3 profitability ratios
B. 2 solvency ratios
C. 3 efficiency ratios
D. 3 shareholder ratios
E. 3 capital structure ratios
Reflect on the differences between the ratio outcomes after the transaction versus before. Do this from the perspective of each of the three most important stakeholder groups.

Question 2. Consolidation (30 marks)
A. You are required to prepare a simple and a concise step-by-step guide for preparing the Consolidated Income statement and Statement of Financial Position to advise the Accountant of the parent company/Group of companies Shell and BG Group.
Ensure you explain the reasons behind your advice on dealing with the below sections when creating consolidated Income Statement and Statement of Financial Position:
i. Investment
ii. Intra-group Assets and Liabilities
iii. Intra-Group dividends (if any)
iv. Unrealised profits
v. Non-controlling interest
This guide should be related to the two companies Shell and BG Group. Avoid copying and redeveloping materials that are available via various information sources. If the guide is not found to be relevant to the two companies Shell and BG Group, your work will not be graded.
B. Calculate the goodwill that explicitly or implicitly has been paid in the transaction. Elaborate on the acquiring company’s (explicit or implicit) argumentation to do so. Furthermore, show how much of this goodwill has materialized in the results in the three years following the transaction.

Question 3. Financing of the transaction (30 marks)
You are a financial consultant and have been asked by the Board of the acquiring company you selected to provide advice on equity financing, specifically the issue of shares. Your advice should take into account the company’s current consolidated financial statements. Write and advice the management board on the following:
A. Describe the various types of shares which the company issued to raise capital. Illustrate your answer with relevant examples (including the composition of the amount of capital raised by each type of shares) as shown in respective section in the Balance sheet.
B. Based on your assessment of the company’s financial statement, what is your advice to the Board of Directors in considering a rights issue. Provide a clear rationale consistent with the relevant IAS (International Accounting Standards) and the company’s financial structure.
C. Explain the accounting treatment of the shares issue if the issued shares are undersubscribed due to the current impact of COVID-19 pandemic affecting many economies across the world? How will this affect the company’s shareholders? How will this be different if you were advising on the issue of a convertible debenture on the company’s capital structure and the shareholders?
D. In the event that some of the shares are forfeited, outline the accounting treatment of the same. How will this affect your selected case study company’s equity capital in the Balance sheet?
E. When forfeited shares are reissued, the company is likely to earn a share premium? If yes, how will the share premium impact your case study company’s’ equity capital?
F. What is your comment on your case study company equity capital when you compare its two consistent financial years?

  1. IAS, Accounting concepts, IFRS (10 Marks)
    You are required to answer only one question below. Either question A or B each question carries the same marks ie 10 points.
    A. Based on the case study company you identified, explain with reference to the specific sections of the consolidated financial statements, how the following accounting concepts have been reflected in the financial statements (Demonstrate your answer with reference to specific category items shown in the financial statements):
    i. Accrual concept
    ii. Matching concept
    iii. Going concern concept
    B. Based on the case study company you identified, name and describe two IAS (International Accounting Standards) and two IFRS (International Financial Reporting Standards) and demonstrate how each one of them has been reflected in the preparation of the:
    i. Consolidated profit and loss account/Income statement of a public company
    ii. Consolidated Balance sheet/Statement of Financial Position.
    Be specific on the respective sections relating to the above-named financial statements to support your answer.
Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our Guarantees

Money-back Guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism Guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision Policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy Policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation Guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more
error: