Category: Finance

Q11.How does a well-constructed investment policy statement (IPS) contribute to the long-term success
of portfolio management, and why is it important to regularly review and update the
IPS?
Q12. How does the concept of asset-liability management (ALM) affect the investment strategies of
institutional investors such as pension funds and insurance companies

Scenario
In this project, you will step into the role of a financial analyst tasked with conducting a comprehensive financial analysis for a potential corporate investment opportunity. Your goal is to create a detailed financial analysis report that will guide the investment decision-making process for the corporation you select from the Final Project Student Spreadsheet, which is linked in the What to Submit section.
You have been hired by a prominent financial consulting firm known for its expertise in providing data-driven insights to corporations seeking to make informed investment decisions. Your firm has a reputation for delivering accurate financial analyses that aid companies in identifying profitable investment opportunities.
Final Project Submission: Financial Analysis Report
In Module Nine, you will submit your financial analysis report along with your completed Final Project Student Spreadsheet. It should be a complete, polished artifact containing all of the critical elements of the final project. It should reflect the incorporation of feedback from your instructor provided throughout the course. This submission will be graded with the Final Project Rubric.
What to Submit
Your financial analysis report should be 7‒12 pages, not including a title page and references page. It should use 12-point Times New Roman font, double spacing, and one-inch margins. Cite sources according to APA style. Also, submit your completed. Your supporting research should be as up to date as possible. Any news stories, press releases, or additional sources must be dated within the last 60 days. Company data should be no more than one year old. Using older data may result in being asked to resubmit your work.

Scenario
In this project, you will step into the role of a financial analyst tasked with conducting a comprehensive financial analysis for a potential corporate investment opportunity. Your goal is to create a detailed financial analysis report that will guide the investment decision-making process for the corporation you select from the Final Project Student Spreadsheet, which is linked in the What to Submit section.
You have been hired by a prominent financial consulting firm known for its expertise in providing data-driven insights to corporations seeking to make informed investment decisions. Your firm has a reputation for delivering accurate financial analyses that aid companies in identifying profitable investment opportunities.
Final Project Submission: Financial Analysis Report
In Module Nine, you will submit your financial analysis report along with your completed Final Project Student Spreadsheet. It should be a complete, polished artifact containing all of the critical elements of the final project. It should reflect the incorporation of feedback from your instructor provided throughout the course. This submission will be graded with the Final Project Rubric.
What to Submit
Your financial analysis report should be 7‒12 pages, not including a title page and references page. It should use 12-point Times New Roman font, double spacing, and one-inch margins. Cite sources according to APA style. Also, submit your completed. Your supporting research should be as up to date as possible. Any news stories, press releases, or additional sources must be dated within the last 60 days. Company data should be no more than one year old. Using older data may result in being asked to resubmit your work.

The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.
Assignments submitted through email will not be accepted.
Students are advised to make their work clear and well presented; marks may be reduced for poor presentation. This includes filling your information on the cover page.
Students must mention question number clearly in their answer.
Late submission will NOT be accepted.
Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).
Submissions without this cover page will NOT be accepted.

Assignment Questions: (Marks- 10)
Answer all the following Questions:
Identify and briefly discuss the various types of option transaction costs? (250-300 words) 2.5 Marks
Explain why an option’s time value is greatest when the stock price is near the exercise price and why it nearly disappears when the option is deep- in -or out- of -the money. (250-300 words) 2.5 Marks
ABC Company stock currently priced at $ 80. One period later it can go up by 25% or go down by 20%. The risk-free rate is 7 percent. Calculate the current /theoretical value of the European call option if the exercise/strike price is SAR 80? (5 Marks)
Answers:
1
2
3

The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.
Assignments submitted through email will not be accepted.
Students are advised to make their work clear and well presented; marks may be reduced for poor presentation. This includes filling your information on the cover page.
Students must mention question number clearly in their answer.
Late submission will NOT be accepted.
Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).
Submissions without this cover page will NOT be accepted.

Assignment Questions: (Marks- 10)
Answer all the following Questions:
Identify and briefly discuss the various types of option transaction costs? (250-300 words) 2.5 Marks
Explain why an option’s time value is greatest when the stock price is near the exercise price and why it nearly disappears when the option is deep- in -or out- of -the money. (250-300 words) 2.5 Marks
ABC Company stock currently priced at $ 80. One period later it can go up by 25% or go down by 20%. The risk-free rate is 7 percent. Calculate the current /theoretical value of the European call option if the exercise/strike price is SAR 80? (5 Marks)
Answers:
1
2
3

Powerpoint Presentation for the attached document
The narrated PowerPoint presentation should be about 6-7 slides. It is recommended to include the following slides:
Slide 1: The title slide with your name and the companies analyzed in the project;
Slide 2-3: The most significant results of the trend analysis of the company with short comments;
Slide 4-5: The most significant results of the ratio analysis of the company with short comments;
Side 6-7: Recommendations

Powerpoint Presentation for the attached document
The narrated PowerPoint presentation should be about 6-7 slides. It is recommended to include the following slides:
Slide 1: The title slide with your name and the companies analyzed in the project;
Slide 2-3: The most significant results of the trend analysis of the company with short comments;
Slide 4-5: The most significant results of the ratio analysis of the company with short comments;
Side 6-7: Recommendations

Powerpoint Presentation for the attached document
The narrated PowerPoint presentation should be about 6-7 slides. It is recommended to include the following slides:
Slide 1: The title slide with your name and the companies analyzed in the project;
Slide 2-3: The most significant results of the trend analysis of the company with short comments;
Slide 4-5: The most significant results of the ratio analysis of the company with short comments;
Side 6-7: Recommendations

Assignment Content The goal of this assignment is to understand the principles of project valuation and capital budgeting in a practical setting, using a combination of fictitious data and real-world examples. Begin by proposing a fictitious project for a hypothetical company. This can be any type of project-expanding a product line, launching a new service, entering a new market, etc. Provide a brief overview of the project, including the expected benefits, the target market, and any initial capital requirements. Complete the following steps in your journal: • Cost of capital analysis: Identify the different types of capital the hypothetical company would need for the project. Estimate the cost of debt, preferred stock, and common stock using assumptions based on typical industry figures. Justify your assumptions. Apply the dividend growth model where relevant and calculate the company’s weighted average cost of capital (WACC). • Capital budgeting and cash flows: Categorize your project (e.g., replacement projects, expansion projects). Lay out the expected cash flows for the project for a defined period (for example, 5 years). Calculate the net present value, internal rate of return, and profitability index of your project. Estimate the payback period for your project. • Real-world comparison: Use the CSU Online Library to research at least two real-world project valuation cases relevant to your fictitious project or industry. Compare the financial metrics (e.g., NPV, IRR, payback period) of these real-world projects to your fictitious project. Discuss any significant deviations between your project and the real-world examples. • Reflection and conclusion: Reflect on the data-driven decisions you made throughout your fictitious project’s proposal and financial feasibility analysis. Document these decisions in your journal. Summarize key learning points and any potential managerial issues that may arise during the real-world implementation of such a project. Use tables, charts, or graphs to present your data and financial calculations wherever applicable. Ensure that your journal has a clear structure, with distinct sections for the proposal, cost of capital analysis, capital budgeting and cash flows, real-world comparison, and reflection and conclusion. Remember, the purpose of this assignment is not just to perform financial calculations, but to critically think about the feasibility of projects and make informed, data-driven decisions. Your journal should be at least 2000 words. All sources, including the real-world project valuation cases, should be properly cited in APA Style.

This case compares two similar but very different companies (all financials have been placed in Google Sheets here). P&G is often thought of as one of the great consumer product companies in the world. Colgate, relatively speaking, flies under the radar and is not as well known or respected. The case presents the history of the two companies and the recent issues at P&G. Be sure to address the following points in your write-up of the case:
Perform a DuPont analysis of P&G and Colgate from 2008 through 2012. Include sustainable growth (for the retention ratio, you can use (1 – payout-ratio), where the payout-ratio can be calculated as dividends-per-share/basic-earnings-per-share). For 2012 only, calculate each companies’ P/E and M/B (for P&G, assume a year-end stock price of $67.89). Assume that Net Income equals ‘net earnings attributable’ or ‘net income attributable.’
Evaluate the overall financial performance of the two companies. Which company is doing better? Are there interesting trends happening over this time period?
What can the DuPont analysis and other financial information tell us about the company’s marketing and operations? (the Note on the DuPont Analysis provides some guidance; use of outside resources is unnecessary). What do you think about Cook’s leadership at Colgate or Lafley’s and McDonald’s at P&G?
OPTIONAL (to increase your chance of receiving 4’s): Draw meaningful insights from a common size analysis of the companies and from a DuPont analysis of the companies’ segments.
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NOTE:
In some instances, financial figures or stock prices presented in the case may differ from what you can find online or in annual reports (since the case was written, financials may have been restated and stock “splits” can affect stock price units). If so, please use the financials from our case. There is no need to use outside data.
You are free to help each other and review each other’s work as long as no copying and pasting occur and you submit your own work.
​
Be sure to follow these guidelines:
**Do not put your name anywhere **on the assignment or on shared exhibits (Forum will track your submission). Your assignment will be graded blindly.
Be sure you submit a single PDF on Forum (do NOT submit Zip files).
Assume your audience is knowledgeable about the accounting/finance concepts we’ve covered in class and is familiar with the case facts. Don’t waste words explaining what asset turnover is or what P&G sells. Jump right into the analysis. Also, there’s no need to replicate case exhibits (you may reference them directly).
Go deep. When formulating a response, ask why. Then ask why again and justify your explanation by citing case facts and material. Back up your explanations with evidence. Integrate numbers into your arguments.
Use no more than two significant digits for all numbers in the text and exhibits (12%, 3.5%, or 0.46%, not .12480294). Less is more. Displaying too many digits makes numbers hard to read and actually obscures their value and intuition.
All exhibits you create yourself and referenced in your write-up must be included in the write-up itself and be properly formatted. You must also include a link to all your exhibits so that your calculations can be seen and checked (only those exhibits that appear in the write-up and are explicitly discussed will be assessed). Place your link at the very beginning of the write-up and be sure to grant your professor and peer tutors viewing privileges. Follow these guidelines (e.g. avoid including numbers in a calculation cell but instead, reference inputs/assumptions cells that do contain numbers; use black text for calculations and blue text for inputs).
Check your spelling and grammar. Poor writing conveys carelessness and unprofessionalism.
The course-related LO’s that are #financials (x2) and #bizfunctions (x1) will be graded based on your answers to the 3 questions above, with each corresponding to a specific LO as described below. You should tag these LO’s and explain in detail how you used them.
In addition to the LO’s mentioned above, use and tag #breakitdown in the text wherever appropriate.
Add a word count at the end of the assignment (exclude exhibits, footnotes, and the bibliography).
For assignment deadline extensions please refer to the policies section written at the end of the course syllabus.
Assignment Information
Length:
1000 – 1250 words plus as many exhibits as necessary to show results of analysis.
Weight:
15%
Learning Outcomes Added
Financials: Evaluate business situations by identifying or calculating accounting and financial information.
BizFunctions: Analyze how improved operating, marketing, or other business functions can enhance financial performance.
links provided:
https://course-resources.minervaproject.com/uploaded_files/production/00230158-5804/assignment-1—procter—gamble-and-colgate-palmolive.pdf
https://docs.google.com/spreadsheets/d/1qwbg3Fz0SSsdmTNJkVbZziCMOxNA5q0h3vXRYHoVRh0/edit?gid=1098908424#gid=1098908424
https://course-resources.minervaproject.com/uploaded_files/production/00230028-2556/note-on-the-dupont-analysis.pdf