Module Title: MSc FINANCIAL MODELLING
Module Code: ACCA40531
The module will be assessed by a 4,000-word individual assignment.
Specific issues to be addressed include the following:
Industry and Company Analysis (30%)
1. Provide a summary of the company’s business activities, and an analysis of its industry. Review the competitive landscape of this industry and examine the macro environmental factors that could affect the industry’s performance.
2. Undertake a financial analysis and evaluation of the historical performance over the past five years. (15%)
Modelling and Valuation (60%)
3. Develop pro-forma financial statements of the chosen company as a basis for estimating its intrinsic price. Your spreadsheet should include:
a. a set of forecasted financial statements (at least 5 years)
b. key assumptions and drivers that influence each of the components of the forecasted balance sheet, income statement and cash flow statements,
c. key parameters to be used for valuation, and
d. the valuation model.
4. Explain and justify the reasons underlying the assumptions and forecasts you made in your valuation model (10%)
5. Conduct a sensitivity analysis [i.e. how future business decisions and strategies can change the valuation outcome. Also how changes in the specific environment of the business such as response to competitive threats, or preparing for different possible outcomes for the wider economy (boom or return to recession) can change the valuation outcome] (10%)
a. Font: Verdana
b. Font size: 10-point size
c. Line spacing: Use 1.5
d. Preferably use justified text
e. All pages should be numbered
f. Use heading styles for all headings
g. All headings should be numbered
h. All tables and figures should be captioned and cross-referenced in the main body of the text.
i. References should be consistent with the NTU Harvard referencing convention.
The assignment is marked in its entirety as one piece of work. However, you need to submit two documents:
1. Your main report (MS Word/PDF)
2. Your model (MS Excel workbook) Restrictions:
• Your chosen company should:
o be a non-financial company. So, you cannot choose banks, insurance companies or any finance related company.
o not be an asset-based company. So, you cannot choose companies in the oil, energy, or mining industries.
o be listed on the London Stock Exchange with quoted share-prices for at least five years.
The report hand in date will be 11.00pm late Sunday, 28-February-2021
NBS Feedback Form for Postgraduate Coursework
Module Financial Modelling
ACCA40531 Student Number and Name
Assessment Element (as stated in the assessment brief) Element 1
Element 2 Element 3
Element 4 Tutor name (s)
Assessment submission date 28th February 2021 Please refer to the Module Learning Room Dropbox Folder for the date you were due to submit. Date Feedback Uploaded Please refer to the Dropbox folder for the date on which your feedback was uploaded.
MODULE LEARNING OUTCOMES ASSESSED
• Evaluate the theoretical issues of financial modelling
• Develop appropriate models to support strategic decision making
• Understand conceptual approaches to financial modelling
• Appreciate common and generic techniques in financial modelling • Critically evaluate financial models used in various decisionmaking contexts
• Critically evaluate modelling tools available to deal with different types of financial risks facing an organisation
• Evaluate and synthesise the problem-solving mechanisms applicable to financial modelling and assess the application of relevant tools and techniques to enhance decision making using comprehensible documentation
The overall grade for the work is based on a holistic assessment and is determined by how well the criteria have been met overall and not the sum of the individual aspects of the work.
In the matrix below, grades awarded against each criterion indicate that the relevant aspect of the work can be more readily associated with that category than any other. Allocation of a grade does not indicate that work exactly matches the associated description.
High Pass High Commendation High Distinction
Mid Fail Mid Pass Mid Commendation Mid Distinction
Low Fail Marginal Fail Pass Commendation Distinction
Zero If a zero grade, select the appropriate comment below:
NS – No work submitted or submitted 5 working days after deadline NK – Work submitted and is in moderation
NE – Work is not yet submitted, and student has an Extension NN – Student did not attend for an exam
Component, and weighting Fa il Marginal Fail Pass Commendation Distinction
15% No awaren
issues relev market sect report dem little aware factors rele the competi landscape o industry. ess of
ant to the or. The
onstrates ness of
tive f the Some breadth of analysis but lacks direct relevance to the firm’s strategy. There is some order to the issues identified, but no evidence of prioritisation.
Some awareness demonstrated from a limited range of information sources, but no justification. A good breadth of
demonstrated with several key issues identified expressing a solid grasp for the issues and good quality of analysis. Issues prioritised with justification.
Good awareness demonstrated by utilising information from a variety of sources but with the absence of full justification and integration. A very good breadth of analysis demonstrated with a number of key issues identified expressing an excellent quality of analysis.
Most key factors have been critically analysed to a reasonable extent.
Rounded awareness demonstrated by utilising information from a variety of credible sources in a logical and integrated manner with good justification. An excellent
overview and an outstanding breadth of analysis demonstrated by the assessment of key issues using conceptual tools to review the structure as well as
landscape of the industry.
High level of awareness demonstrated by utilising information from a variety of credible sources in a logical, integrated and justified manner.
15% No or inapp discussion financial pe of the firm, or no refere common ra
Demonstrat or no under of evaluati
e Some good explanation of the financial performance of the firm, with limited reference to common ratios or some
Demonstrates a limited understanding of evaluating historical performance Good expla the financia performanc firm, with a assessment relevant co ratios;
Demonstrat understandi evaluating performanc analysis fail adequately holistic ass of performa nation of l
e of the
es a good ng of
s to provide a
essment nce. Very good evaluation of the financial performance of the firm;
logical and holistic approach to financial analysis by addressing the interrelationship between various performance metrics and by critically assessing changes in performance. Exceptional evaluation of the financial performance of the firm;
Demonstrates an excellent approach to financial analysis
60% No or inapp explanation justification variables a
Demonstrat or no logica approach t Discounted modelling i estimating interpreting intrinsic val company; No or inapp sensitivity/ analysis ropriate
ue of a
ropriate scenario Poor explanation and very descriptive justification of variables and proxies used; Demonstrates a limited approach to using Discounted cash flow modelling in estimating and interpreting the
intrinsic value of a company;
No or inappropriate sensitivity/scenario analysis
Limited engagement with relevant literature Good expla and some c justification variables a
a good, logi approach t Discounted modelling i estimating interpreting intrinsic val company; errors are e the submitt model(s); Demonstrat
mechanical to scenario/se analysis wit marginally j assumption nation ritical
ue of a
ion of a approach
nsitivity h ustified
s. Very good
critical justification of variables and proxies used; Demonstrates an excellent, logical approach to using Discounted cash flow modelling in estimating and interpreting the
intrinsic value of a company; Few errors are evident in the submitted model(s); Descriptive
relevant literature; Demonstration of a logical approach to scenario/sensitivity analysis with well
justified assumptions. Excellent explanation
and critical justification of variables and proxies used; Demonstrates an exceptional, logical approach to using Discounted cash flow modelling in estimating and interpreting the intrinsic value of a company; Very few or no errors are evident in the submitted model(s); Critical engagement with relevant literature in critiquing modelling techniques, choices and decisions; Demonstration of a rounded approach to scenario/sensitivity analysis with well