You are required to analyse a company which is a constituent of the FTSE 350 index of the London Stock Exchange.
As each student is required to choose a different company, you should agree your choice of company with the module leader prior to commencing work.
Since 2005, all European Union companies with securities traded on a regulated market have been required to prepare their consolidated financial statements in accordance with IFRS. The intention of European policymakers was to make financial reporting by European listed companies more transparent and comparable and to enable EU capital markets to function more efficiently.
(i) Critically comment on the financial performance and financial position of your chosen company over a five year period and consider how this might differ from the wider stockmarket. Any detailed calculations should be included in an appendix and support your discussion.
(ii) Critically evaluate the degree to which the development of a consistent international financial reporting framework enables a meaningful comparison of your company’s performance with those of its competitors.
The board’s role is to provide leadership of the company within a framework of effective controls, enabling risk and opportunity to be managed. An effective board promotes its vision and the values and behaviours it requires to ensure that directors meet their statutory and moral duties.
Directors of all UK companies, irrespective of size, have an ultimate duty to promote the success of their company for the benefit of its members. In most cases, this means the shareholders.
Directors, however, must also have regard to a number of other specified stakeholders and wider issues. These include the interests of the company’s employees and the need to foster relationships with suppliers, customers and others. This approach, known as “enlightened shareholder value”, is set out in section 172 of the Companies Act 2006.
Critically evaluate the extent to which the board of your chosen company has demonstrated compliance with this legislation since its introduction. Your answer should include focused comment and examples of changes to stakeholder expectations in respect of corporate governance and non-financial reporting over this period.