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Sustainable Business Projects - Investment Returns

Investment Returns with Bitcoin

Assessment Task Requirements:
Your Role and Investment Task:
You are an independent investment consultant in Australia and you have been employed by Sunshine Growth Super (SGS) in order to assist them to improve their investment returns to their superannuation fund members. As part of increasing the returns to fund members, SGS has the combined objectives of diversifying investment risk and expanding their investments in global companies who are committed to developing sustainable business projects.
To achieve this outcome, the Board of Trustees would like to further expand SGS’s operations globally by investing $700 million in:
1- Fiat Chrysler Automobiles (United Kingdom)
2- BMW Group (Germany)
3- Toyota Motor (Japan)

To ensure that all global options are fully explored, three culturally different regions globally are of interest to the SGS Trustees as highlighted below:
Anglo Saxon countries (e.g. UK, Australia, Canada, former Commonwealth member countries such as India, Malaysia, Singapore etc. and the Nordic countries of Denmark, Netherlands and Sweden) – Note: you cannot use the US as a nation.
# Fiat Chrysler Automobiles (United Kingdom)

the Germanic/Latin countries (e.g. France, Germany, Italy, Poland, Czech Republic, Switzerland, Brazil, Chile, Argentina and Mexico); and
# BMW Group (Germany)

the Asian countries (e.g. China and Japan).
# Toyota Motor (Japan)
A: Preliminary Explanation for Selection of Three Global, Listed Companies
In your introduction: (a) provide a summary explanation of why you have selected the industry; (b) provide a preliminary and summary explanation of why you have selected each of the three, listed companies for your analysis.

For example, are all three companies from nations that have adopted IFRS and/or are there current (2018 or 2019) annual reports available from the three companies that you have selected? In these annual reports is it clear that the listed companies are profitable and that the company itself is actually using IFRS to prepare the financial information within the annual report? Are there issues of corruption or serious environmental impacts or economic issues related to the companies which may impact negatively (or positively if there is a lack/absence of corruption and environmental issues etc.) on any potential investment in the listed companies you have selected?
It is recommended that you use a table format for this explanation as highlighted in Lecture Four and the examples that will be provided on Discussion Board; and

2. Compare the strengths and weaknesses of these three, listed companies in a summary table. Why are these factors important for the sustainability of these companies in the global market?

B: Comparative Analysis of Three Nations – PRE-IFRS Development Factors, Cultural Dimensions and Accounting Values and Their Impact on POST-IFRS Accounting Values and Financial Information Quality

In entering into this new investment project, the SGS trustees have heard of the major global convergence project that has been developed since the major Economic Crisis in 1987, and are interested in understanding, firstly, what financial reporting factors/issues contributed to this event.

They are also interested in obtaining your advice as to whether the IFRS project has been successful in lowering foreign direct investment risk. In order to provide the relevant information to the trustees in terms of the three nations you have selected you are required to:

Provide a comparative analysis of the key (most important) PRE-IFRS development factors of the three nations associated with your three, selected, listed companies;
NOTE:

Provide a comparative analysis of the PRE-IFRS cultural dimensions identified for each nation within the Hofstede model and discuss how the PRE-IFRS development factors outlined in Part Two have impacted on these dimensions – NOTE: Do NOT use the Hofstede site/scores in this analysis – refer to class discussions;

Provide a comparative analysis of the PRE-IFRS accounting values that are then associated with each of these country-based sets of cultural dimensions as established within the Gray model and discuss how the PRE-IFRS development factors and the cultural dimensions discussed in Parts Two and Three have impacted on these accounting values; and

Summarise the major changes in the financial reporting/accounting processes in each of the three nations you have analysed in the POST-IFRS era. In your answer, identify the date each nation adopted the IFRS framework and provide a summary comparison table of the key accounting values in each nation in a PRE and POST-IFRS comparison. In your view, has the quality of the financial information provided by each nation’s global corporations improved in the POST-IFRS era? Why or Why Not?

Part Two: Analysis of Research Findings from Part One – Responses to the Trustees = 66 Marks:
Note: This International Financial Statement Analysis Framework is analysed in detail in Lecture Eight
C: Comparative Analysis of Three, Selected Companies, Identification of Corruption Levels and Financial Statement Analysis Limitations
To further assist the SGS trustees and based on the data/evidence you have collected on each of your three nations, the industry and your three companies:
(a) Provide a comparative analysis of the three companies selected utilizing the international financial statement analysis process which includes:

Step One – An overall Business Strategy Analysis;
Step Two - The analysis of each company’s Financial Reporting Practices; and
Step Three - A Financial Analysis

Note: A Prospective Analysis is not required.

Note: Within your Step One Business Strategy Analysis, further develop your response in Question One in relation to the listed companies selected, by discussing any key issues that you feel may impact on (increase or decrease) future FDI flows into each of your three nations and/or the industry selected.

For example, if you have selected a British company as a potential investment, then the withdrawal of the UK from Europe (the BREXIT issue) would be relevant. For listed companies from other nations, the current and or future level of corruption and/or environmental issues etc. would need to be considered; and

b) Summarize the three key hindrances or limitations to international financial statement analysis that you encountered in trying to complete the recommended international financial statement analysis in Part (a) and comment on whether you believe that these limitations can be successfully overcome and how this could be achieved; and

D: Overall Investment Recommendation
Using all of the information obtained from your cross-cultural comparative analysis of the three selected companies (pre-IFRS development, cultural dimensions and accounting values, POST-IFRS accounting values and your overall financial statement analysis), derive an overall comparative conclusion and make a recommendation to the SGS trustees as to the best investment option from any of the three companies analysed, providing reasons for your final recommendation.

Sustainable Business Projects - Investment Returns

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