ACCY131 Fundamentals of Accounting Haskell

Java Python ACCY131

Fundamentals of Accounting

Assignment

Due Date and Time: Week 10, Monday 23 September 2024 5.00pm

Instructions: A case study with 5 sub-parts.

The work you submit must be entirely your work. Please do not plagiarise. Copying the works of others is considered cheating and will lead to zero mark and disciplinary action.

Contribution to Final Grade: 30%

Word Limit: 2,000 words including references.

Total Marks: 100 marks

Case Study: Louis Vuitton, Société Européenne (LVMH)

Financial Statement Analysis

LVMH Moët Hennessy - Louis Vuitton, Société Européenne (LVMH) is aglobal luxury goods company headquartered in Paris, France. It offers a wide range of products, including champagnes, wines, spirits, fashion and leather goods, perfumes and cosmetics, watches and jewellery, and custom-designed yachts. The company operates under numerous prestigious brands such as Louis Vuitton, Dom Pérignon, Christian Dior, Givenchy, and Tiffany & Co. LVMH also engages in selective retailing, luxury tourism, and media services. Established in 1923, LVMH operates 5,664 stores worldwide.1

LVMH’s financial year for 2023 concluded on 31 December 2023. The  2023 Universal Registration Document, which includes the Consolidated Financial Statements (from pages 238 to 301), is attached.

Additional information:

•   As of 31 December 2023, LVMH had 500,056,586 ordinary shares in issue.

•   As of 31 December 2023, the effective tax rate for LVMH was 26.2%.

•   As of 31 December 2023, the market value per share for LVMH stood at 645 EUR.

Required:

You are required to perform the following ratio analysis for LVMH for the financial year ending 31 December 2023. Please&n ACCY131 Fundamentals of Accounting AssignmentHaskell bsp;show all your workings. Please also provide appropriate reference sources, accurately cited using APA referencing or legal citation (footnotes).

After performing each ratio analysis, provide a brief assessment of your understanding of what that ratio analysis tells you about LVMH’s performance during the financial year ending 31 December 2023.

Part 1: Activity Ratios

1.   Receivable turnover and days of sales outstanding (4 marks).

2.   Inventory turnover and days of inventory on hand (4 marks).

3.   Payablesturnover and number of days of payables (4 marks).

4.   Asset turnover (4 marks).

5.   Fixed asset turnover (4 marks).

6.   Working capital turnover (4 marks).

[Total of 24 marks]

Part 2: Liquidity Ratios

1.   Current ratio (4 marks).

2.   Quick ratio (4 marks).

3.   Cash ratio (4 marks).

4.   Defensive interval (4 marks).

5.   Cash conversion cycle (4 marks).

[Total of 20 marks]

Part 3: Solvency Ratios

1.   Debt-to-equity ratio (4 marks).

2.   Debt-to-capital ratio (4 marks).

3.   Debt-to-assets ratio (4 marks).

4.   Financial leverage (4 marks).

5.   Interest coverage ratio (4 marks).

[Total of 20 marks]

Part 4: Profitability Ratios

1.   Gross profit margin (4 marks).

2.   Operating profit margin (4 marks).

3.  Net profit margin (4 marks).

4.   Return on assets - ROA (4 marks).

5.   Return on equity - ROE (4 marks).

[Total of 20 marks]

Part 5: Valuation Ratios

1.   P/E ratio (4 marks).

2.   P/B ratio (4 marks).

3.   P/S ratio (4 marks).

4.   P/CF ratio (4 marks)