Author: alishahart01

This begun as a blog specifically created for a accounting unit. However, like everything that unit has come to an end. Currently I have begun to study Foundations of Business Law. It is a different unit and experience from moving from a course with high communication to one with nearly none. So I have begun to write this blog just for myself and for no one to really read.

Here we are, officially finished this course, everything handed in an done.

I would like to thank everyone whom has helped me so much throughout this course. My own experience of this course was enhanced by the many people in it.

I would like to thank my lectrures whom showed me that rote learning was not the only type of learning. Before this course that is all I feel I did and now I truly understand how it feels to change as a person through learning.

I can not believe we are finished this course, it was at most time challenging however overall enjoyable and interesting all at the same time.

So I guess this is it, all I can say is goodbye for now.

To begin with, these ratios have been such a process! They have been challenging, enlightening and difficult. From these ratios I have learnt that Keller UK are in trouble. However, they do have high efficiency which is just not reflected in their profitability ratios. The worst year for Keller across all sectors was 2018, due to losses which can be read about in the assignment. Keller overall is great to shareholders and gives more than they have in EPS to DPS.

In every scenario, Keller’s ratios were improved by separating the operating from the financial. I believe this portrays the reason why my company only has a small amount of financial activities and a high amount of operating activities.

The main questions I had raised was over the Price Earnings Ratio being so small. I wonder why it is so small and yes I do wonder whether it is correct or if I have calculated it incorrectly.

For this assignment I mainly compared with Louise’s company, Iberdrola. From here I learnt that Iberdrola had better profitability ratios due to better performance reflected through higher OI and net profit margin figures. Unlike Iberdrola however Keller has given more to shareholders in DPS than they received in EPS. This is great for shareholders however, not for the company which does need to save money. Unlike Iberdrola, Keller has a low RNOA which does portray that it does not effectively use it’s operating assets to generate profit, a main driver of the issues with profitability ratios.

However, I did learn through Facebook that many people with construction companies found that their days of inventory was high. Again that conversation can be seen in my assignment. This was so great as I got to compare with an industry benchmark and found overall Keller sat nicely on that benchmark where they did not lose opportunities through turning over their inventory to high, or lose to much in taking to long to turn over their inventory.

Through PASS, I was also able to compare Keller UK with both construction and just other companies. I learnt that although my profitability ratios were not to impressive, other companies also had low figures. This made me go ‘well Keller UK if they can do it so can we,’ which is weird I feel as if I have emotionally connected with Keller UK throughout this process. But I did learnt that other companies have had lower figures than Keller for net profit margin and return on assets for 3-4 years, as Keller has seen good figures in 2017-2016, but decreases from 2015 and 2018.

From this I feel as if Keller UK has a pattern where they buy/ upgrade assets and sectors (something I did notice in their 2018 and 2015 annual reports) every three years. This makes sense as their profitability ratios obviously decrease but their efficiency ratios increase. Also, this makes sense as Keller UK has quiet a high current ratio and hence more current assets than current liabilities. My company may seem as if they are going ‘off the rails’, however when you look at the big picture Keller UK push. They push their finances to improve their sectors and add value to their firm. they do this safely through having enough assets to cover any debts. Keller UK are quiet and interesting and well managed company.

Nonetheless, most of what I did learn is in my assignment.

Hello everyone,

I have placed up my draft and I would love your feedback

I found that this process was very interesting and that as I continued through calculating and analysing the different aspects of economic profit I began to see the different ways that each factor effected my economic profit.

From this process I learnt that Keller’s figures for economic profit were not consistent. But this made sense due to the RNOA figures being inconsistent. The figures are from 2015-2017 however significantly dropped in 2018 due to massive loses in the company.

I learnt from this process that if the RNOA is less than the cost of capital a negative Economic Profit figure is formed. Even if there is a high NOA figure that will only increase the negative figure and hence decrease the Economic Profit.

This process has been very emotional. I did have to change a few ratios as they were wrong and I found this put my behind due to having to re-write about them. However, I saw no sense in handing up an assignment which I knew wasn’t completed properly.

However, the main insight I gained from step 8 was the idea that we all need to look at the big picture of everything. to begin with when I was completing the profitability ratios I was like ‘wow these are terrible, how is my company running?’. However, I learnt that Keller have great Current and Efficinecy Ratios when compared to other companies. I learnt that Keller take longer to turn their inventories into cash just due to the fact they are in construction. I learnt that whilst my company looks as if it is going down, Keller does play safe. Keller had more than a dollar of aasets for a dollar of liabilities, Keller give constant DPS to their sharholders to keep them happy. Keller does not do what is best for their figures, they use the figures to do the best for their company and everyone whom values them.

I am actually sad that I have to let this company go and move on. When I saw Keller UK and construction back in week 1 I was mortified and had no idea on where to begin. But I became to really like Keller and how they run and how a business runs, something which was not the overall focus of the unit but something we all gained and need to know as accountants.

Well, finishing my ratios and just beginning my commentary I found a main aspect to be comparing ratios with others. So below I have placed the excel spreadsheet which contains my ratios and I would love it if people left a comment with their ratios included.

Hello everyone, I cannot believe we are already halfway through the last assignment! I thought that I would just pop up my step 5

Beginning this journey I was asking myself how exactly could I do this? I knew the equations but I was struggling and then, I found Maria’s videos. This video proved to be a life saver and a great way to start my ratio analysis journey. How did you start your ratio analysing journey?

The past few days I have been busy reading drafts of my peers and wow, has the quality increased from the last drafting phase! I feel as if everyone in this course is jus improving so much. I have read some fantastic drafts which have had so many hours poured into them.

I was also very grateful to receive some fantastic feedback from Louise, Sarah, Jessica and Miranda. Thankyou so much, all of your feedback was excellent and I am so grateful that you chose my draft to read!

How has everyone else found the drafting phase?

Well here it is, a lot of time and effort has gone into this draft, I hope that you enjoy reading it.