UNIVERSITI TUNKU ABDUL RAHMAN

FACULTY OF BUSINESS AND FINANCE

ACADEMIC YEAR 2015/ 2016
BACHELOR OF BUSINESS ADMINISTRATION (HONS) BANKING AND FINANCE
BACHELOR OF COMMERCE (HONS) ACCOUNTING
BACHELOR OF BUSINESS ADMINISTRATION (HONS)
BACHELOR OF BUSINESS ADMINISTRATION (HONS) ENTREPRENEURSHIP
BACHELOR OF SCIENCE (HONS) LOGISTICS AND INTERNATIONAL SHIPPING
YEAR 2
GROUP ASSIGNMENT (Marking Scheme)
Topic: Analyze and Produce Report on Financial Firms Evaluation and Performance
Tutorial Group : T 25
Tutor : Cik. Nabihah Binti Aminaddin
Due date : Week6, 26 February 2015 (Friday)
Group Member:

No Student ID Name Course

1 13ABB02154 Wong Bing Xiang AC
2 13ABB03272 Goh Khai Loon BA
3 11ABB04270 Lim Meng Wei BA
4 14ABB06453 Vicknes Thevar BA
5 14ABB07178 Amy Charmaine BA
6 13ABB04247 Ng Jia Xin BA

MARKING SCHEME

No. Assessment Marks Allocation Marks Obtained

(a) Background of the company
-Introduction of company profile
-Summary of company asset and liabilities 2
3
(b) Calculate and interpret Financial Analysis Ratios
-Calculation for ratios
-Interpretation of ratios 5
5
(c) Comment and compare on the THREE (3) years company financial performance
-Briefly explain the comparison of company financial performance. 10
(d) Reviews on the related article/news
-Introduction
-Findings 5
10
(e) Recommendations and/or lessons learned 5
(f) Overall conclusion with justification on the company which is worth to i
nvest 5
Total 50
Overall comment:
_________________________________________________________________________
_________________________________________________________________________
Assessed by: __________________ Date
TABLE OF CONTENT

PART ASSESSMENT PAGE

A Background of the company
-Introduction of company profile
-Summary of company asset and liabilities 4
B Calculate and interpret Financial Analysis Ratios
-Calculation for ratios
-Interpretation of ratios 5-13
C Comment and compare on the THREE (3) years company financial performance
-Explaining on the comparison of company financial performance. 14-19
D Reviews on the related article/news
-Introduction
-Findings 20-21
E Recommendations and/or lessons learned 22-23
F Overall conclusion with justification on whether the company is worth to
invest 24
References/ Bibliography 25-28
Appendices 29 ONWARDS

PART A COMPANIES PROFILES

BERJAYA ASSETS BERHAD BACKGROUND
Berjaya Assets Berhad (previously known as Matrix International Berhad)
is a Malaysia based company and was recorded on Main Board of Bursa Malaysia Sec
urities Berhad on 17 August 1978. Berjaya Assets Berhad is involved in investme
nt holding and provision of management services to its subsidiary companies. The
company is divided into gaming and related activities such as property developm
ent, property investment and recreation that including hotel operation and theme
park.
Berjaya Assets Berhad is the developer of Berjaya Times Square which is
one of the biggest retail and business ventures in Malaysia and has now turned i
nto a global point of interest for Kuala Lumpur city. There are few business ope
rations under Berjaya Times Square Sdn Bhd such as Kuala Lumpur Berjaya Times Sq
uare mega mall and Berjaya Times Square Theme Park.
The group also owns Natural Avenue Sdn Bhd which operates number forecas
t lotteries in the state of Sarawak such as provision of lottery consultancy. No
t only that, Natural Avenue Sdn Bhd is the main agent for Sarawak Turf & Equestr
ian Clubs Special Cash Sweep Number Forecast Lotteries.
In addition, Berjaya Asset Bhd is fully owns 3 different company which a
re Berjaya Time Square Car Park Sdn Bhd, Berjaya Waterfront Sdn Bhd and Sublime
Cartel Sdn Bhd.
Financial highlights for Berjaya Asset Bhd as based on the companys annual
reports from the year 2012-2014, the companys total revenue in 2014 is RM419.4 mi
llion and a pre-tax profit of 121.7 million compared to the year 2012 revenue of
RM331.4 million and a pre-tax profit of RM201.3 million. It shows that the comp
anys revenue has increased from the year 2012-2014. Companys total assets were incre
ase drastically from year 2012 to year 2014. However, total liabilities for Berj
aya Asset Bhd were increasing from year to year. There is a huge decrease in ear
nings per share in year 2013 which amounting from 15.93 sen to 4.12 sen. Part B
and part C for this assignment will further discuss with Berjaya Asset Bhd finan
cial information.
PART B Financial Ratio Analysis- Calculation
2.1 Liquidity
Liquidity ratio is referring to the solvency of the firms overall financial positi
on and it is to determine the companys ability to satisfy its short term obligatio
n as they come due. (Gitman, 2007)
Current Ratio (times) :
The current ratio is used to measure the ability of the company to cover its cur
rent liability by using its current assets. The concept behind this ratio is to
ascertain whether a company's short-term assets (cash, cash equivalents, marketa
ble securities, receivables and inventory) are readily available to pay off its
short-term liabilities (notes payable, current portion of term debt, payables, a
ccrued expenses and taxes). In theory, the higher the current ratio, the better.
(Loth, n.d.)
2012 (RM000) 2013 (RM000) 2014 (RM000)
=3.05 times
=1.36 times
=1.67 times
From the table above, it shows that the current ratio of the company in year 201
2 is 3.05 times and it drops dramatically to 1.36 times in year 2013. However, i
ts current ratio in year 2014 is raise slowly in year that is 1.67 times.
Quick Ratio (times) :
The quick ratio also known as Acid-Test Ratio that indicates liquidity that furt
her refines the current ratio by measuring how the company use the amount of the
most liquid current assets to cover its current liabilities. The quick ratio i
s more conservative than the current ratio because it excludes inventory and oth
er current assets, which are more difficult to turn into cash. Therefore, a high
er ratio means a more liquid current position. (Loth, n.d.)

2012 (RM000) 2013 (RM000) 2014 (RM000)

=1.14 times
=0.44 times
=0.78 times
The table above indicates that the Quick Ratio of the company in year 2012 is 1.
14 times and has a sharp decreasing to 0.44 times in year 2013. However, the rat
io is increase 0.34 times to 0.78 times in year 2014.
2.2 Efficiency
Efficiency ratios measure the ability of a business to use its assets and liabil
ities to generate sales. A highly efficient organization has minimized its net i
nvestment in assets, and so requires less capital and debt in order to remain in
operation. In the case of assets, efficiency ratios compare an aggregated set o
f assets to sales or the cost of goods sold. In the case of liabilities, the mai
n efficiency ratio compares payables to total purchases from suppliers. (Bragg,
2014)
Inventory Turnover (times):
Inventory turnover is representing the ability of company sell its inventory and
replace over a period of time. It is commonly used to measure the activity or l
iquidity of a firms inventory. (Gitman, 2007)
2012 (RM000) 2013 (RM000) 2014 (RM000)
=1.27 times
=1.02 times
=1.10 times
In the table above shows the fluctuation of Inventory turnover of Berjaya Asset
Bhd. The ratio was decrease from 1.27 times in year 2012 to 1.02 times in year 2
013 and it increase to 1.10 times in year 2014.

Average Collection Period (days): x 365

The average collection period is measuring the approximate amount of time that u
se to collect back the payment owed, in terms of receivable, by its customers an
d clients. It is useful to evaluating credit and collection policies. (Gitman, 2
007)
2012 (RM000) 2013 (RM000) 2014 (RM000)
=79.62 days
=23.69 days
=42.68 days
The table above shows that the most effective to collect back the credit sales i
s 24 days in year 2013. It slows down the collection period to 43 days in year 2
014. Berjaya Asset Bhd use 80 days to collect back their credit sales in 2012 an
d it is the slowest among three years.
Average Payment Period (days): x 365
*Purchase (RM000): Cost of Good Sold C Opening Stock + Closing Stock
The average payment period is the average period taken by the company in making
payments to its creditors. It is computed by dividing the number of working days
in a year by creditors turnover ratio. (Gitman, 2007)

2012 (RM000) 2013 (RM000) 2014 (RM000)

Purchases(RM000)
=RM 288141
=RM 201512
=RM 216364
Average Payment Period
(Days)
=89.66 days
=265.11 days
=203.68 days
In the table above shows that Berjaya Asset Bhd use around 3 months to settle it
s debt but the company lengthen the payment time to more than 200 days in 2013 a
nd 2014. The company needs to use 265 days in returning their debt in 2013 and 2
04 days in 2014.
Total Asset Turnover (times) :
Total Asset Turnover is the ratio of the value of a companys sales or revenues gen
erated relative to the value of its assets. It indicates the efficiency of the c
ompany on how the company generate sales by using it assets. (Gitman, 2007)
2012 (RM000) 2013 (RM000) 2014 (RM000)
=0.1241 times
=0.1202 times
=0.1291 times
The table above indicates that Berjaya Asset Bhd is weak in generate sales by us
ing their assets. In year 2012, the total asset turnover ratio is only 0.1241 ti
mes. It falls to 0.1202 times in 2013 and rise back to 0.1291 times in 2014.
2.3 Leverage Ratio
Leverage ratio also known as debt ratio that shows the ability of a company in r
elying on a mixture of owners' equity and debt to finance their operations. A le
verage ratio is any one of several financial measurements that look at how much
capital comes in the form of debt, or assesses the ability of a company to meet
financial obligations. In general, the more debt the company has, the greater it
s risk of being unable to meet its contractual debt payment. (Gitman, 2007)
Debt Ratio (%): x 100%
Debt Ratio is a financial ratio that measures the extent of a companys or consumers
leverage. The debt ratio is used to interprets the proportion of a companys assets
that are financed by debt. In general, the higher the debt ratio, the greater t
he amount of debt is used to generate profits. (Gitman, 2007)

2012 (RM000) 2013 (RM000) 2014 (RM000)

=27.97%
=26.44%
=23.13%
The debt ratio of Berjaya Asset Bhd in 2012 is 27.97%. It drop continuously to 2
6.44% in 2013 and 23.13% in 2014. This value indicates that the company has fina
nce lower than 30% of its assets with debt.
Debt To Equity (%) : x 100%
The debt to equity ratio is a debt ratio used to measure a company's financial l
everage, calculated by dividing a companys total liabilities by its stockholders'
equity. The debt to equity ratio indicates how much debt a company is using to f
inance its assets relative to the amount of value represented in shareholders equi
ty. (Investopedia, n.d.)
2012 (RM000) 2013 (RM000) 2014 (RM000)
=38.83%
=35.94%
=30.09%
The table above indicate that Berjaya Asset Bhd able to use 38.83% of their shar
eholder equity to meet its obligation. The ratios continue to fall to 35.94% in
2013 and 30.09% in 2014.
Times Interest Earning Ratio (times) :
The time interest earned ratio also call as interest coverage ratio which can us
ed to measures the firms ability to make contractual interest payment. This ratio
also indicates that the proportionate amount of income that can be used to cover
interest expenses in the future. The higher the values of time interest earn ra
tio, the better the ability of the company to fulfil its interest obligation. (G
itman, 2007)

2012 (RM000) 2013 (RM000) 2014 (RM000)

=8.18 times
=2.30 times
=3.12 times
The table above indicates that the Times Interest Earning Ratio of the company i
n year 2012 which is 8.18 times and decrease to 2.30 times in year 2013. However
, the ratio is increase 0.82 times to 3.12 times in year 2014.
2.4 Profitability Ratio
Profitability ratio is used to measure the ability of the company in making prof
its. This ratio enables analysts to evaluate the companys profit with respect to t
heir sales, the asset level of the company, or the owners investment. In order to
attract the investor to invest in the company, they need to rely on the profitab
ility of the company. So, the owner, creditor, and management need to pay full a
ttention to boost up the profitability of company because it is great important
market place on earning. (Gitman, 2007)
Net Profit Margin (%): x 100%
Net profit margin is the percentage of remaining revenue after deducts all cost
and expenses including interest, taxes, and preferred stock dividend. (Gitman, 2
007)
2012 (RM000) 2013 (RM000) 2014 (RM000)
=50.59%
=14.62%
=12.06%
Table above shows that the net profit margin for Berjaya Asset Bhd in 2012 is th
e best among three year. In year 2012, the net profit margin of the company is 5
0.59% but it drops dramatically to 14.62% in year 2013 and drop continuously to
12.06% in year 2014.
Return On Total Assets (%): x 100%
Return on total asset also calls as return on investment and it measures the ove
rall effectiveness of management in generating profits by using its assets. (Git
man, 2007)
2012 (RM000) 2013 (RM000) 2014 (RM000)
=6.28%
=1.76%
=1.56%
The table above shows that the return on total asset for Berjaya Asset Bhd not i
n healthy condition. In 2012, the return on total assets for Berjaya Asset Bhd i
s 6.28% and decrease continuously to 1.76% in 2013 and 1.56% in 2014.
Return On Equity (%): x 100%
Return on equity is the net profit return as a percentage of shareholder equity.
It indicates that the ability of the company used the money which invented by s
hareholder to make profit. (Investopedia, n.d.)
2012 (RM000) 2013 (RM000) 2014 (RM000)
=8.70%
=2.39%
=2.03%
The table above shows that the return on equity for Berjaya Asset Bhd not in goo
d condition. In 2012, the return on total assets for Berjaya Asset Bhd is 8.70%
and decrease continuously to 2.39% in 2013 and 2.03% in 2014.
2.5 Market Ratio
The market ratios used to find the value of a company by comparing the book valu
e of a firm to its market value. It measured by its current share price to certa
in accounting values. The ratio gives insight for the investor in the marketplac
e to look out the performance of the company through the risk and return of the
company. This ratio helps common stockholder to assess the companys past and expe
cted future performance. (Gitman, 2007)
Price/Earnings (P/E) Ratio (times) :
The price-earnings ratio (P/E Ratio) is the ratio for valuing a company that mea
sures its current share price relative to its per-share earnings. It measure the
amount that investor willing to pay for each dollar of a companys earning. The de
gree of confidence that investor has toward the firm performance is based on the
level of this ratio. The higher the ratio, the greater the investors confidence.
(Gitman, 2007)
2012 (RM000) 2013 (RM000) 2014 (RM000)
=5.78 times
=22.09 times
=20.39 times
The (P/E) Ratio of Berjaya Asset Bhd is increase to more than 20 times in year 2
013 and year 2014. The table indicates that the amount in 2012 is 5.78 times and
increase to 22.09 times in 2013 and decrease slightly to 20.39 in 2014. It show
s that the confidence level of investor is increase compare to year 2012.
Book Value Per Share :
Book value per common share is a measure used by owners of common shares in a fi
rm to determine the level of safety associated with each individual share after
all debts are paid accordingly. (Investopedia, n.d.)

2012 (RM000) 2013 (RM000) 2014 (RM000)

=RM 1.73
=RM 1.99
=RM 2.24
The table above shows the book value of the company is increasing from year 2012
to year 2014. The book value per share is increase from RM 1.73 in 2012 to RM 1
.99 in 2013 and continuous to increase to RM 2.24 in 2014.
Market /Book (M/B) Ratio :
The Market /Book (M/B) Ratio provides an assessment of how investor view the per
formance of the company. (Gitman, 2007) It is a financial ratio used to compare
a company's current market price to its book value.
2012 (RM000) 2013 (RM000) 2014 (RM000)
=0.4855
=0.4573
=0.3705
This M/B ratio means that the investor of Berjaya Asset Bhd was paying RM 0.49 f
or each RM 1.00 of book value of their companys stock in year 2012. It slightly de
cline to RM 0.46 in year 2013 and continuously decline to RM 0.37 in year 2014.
PART C COMMENT, COMPARE AND CONTRAST ON THE COMPANY FINANCIAL PERFORMANCE
Creditors Perspective
For the perspective of creditors, they would look into Berjaya Asset Bhds
liquidity and leverage ratio. According to Investopedia (n.d.), it defined lever
age and liquidity are both terms that refer to an organizations financial conditio
n but with some notable differences. Leverage refers to a company's capability t
o meet its long-term financial commitments and Liquidity refers to an enterprises
ability to settle its short-term debts and how efficient the company can convert
its asset into cash as to raise fund.
Based on the analysis, the liquidity ratio of Berjaya Asset Bhd is headi
ng to doubtful. As refer to the calculated Quick Ratio (Acid-test Ratio) in part
b, the quick ratios have a huge decrease from 1.14times to 0.44times between ye
ars of 2012 and 2013. The amount of 1.14times in year 2012 indicates that Berjay
a Asset Bhd has RM1.14 in liquid current asset of every RM1 in current liabiliti
es. In other words, Berjaya Asset Bhd has its current liabilities covered 1.14ti
mes over. In contrast, for year 2013, Berjaya Asset Bhd has only RM0.44 in liqui
d current asset of every RM 1 in current liabilities and it shows that Berjaya A
sset Bhd is unable to pay off its current liabilities on year 2013. This is due
to there is an increase in current liabilities in year 2013. To proof that, Be
rjaya Asset Bhd annual report year 2013 notes 25 shows that there is a huge incr
eased in other payables and accruals (which recorded under current liabilities)
from RM13,513,000 to RM97,573,000 due to the balance purchase consideration for
the acquisition of several parcels of land amounting to RM81,407,000. For year 2
014, there is a slight increase of quick ratio, but the company is still unable
to settle its current liabilities with quick ratio which is below 1.
On the other hand, current ratio shows a positive view on the capability
to pay off its short-term liabilities as the current ratio is taken into accoun
t with the closing inventory. As according to the calculated current ratio, the
current ratio is fluctuated within these 3 years. The current ratio between yea
r 2012 and 2013 shows a large decrease from 3.05times to 1.36times. This is beca
use of the increase in current liabilities as mentioned in second paragraph and
a slight decrease in the inventory on year 2013. Nevertheless, the company is st
ill able to settle its current liabilities; Berjaya Asset Bhd has RM1.36 in curr
ent asset to pay off every RM 1 in the current liabilities on year 2013. Current
Ratio in year 2014 show a minor increase from 1.36times to 1.67times and it sho
ws that the company is having RM1.67 current asset to settle every RM1 current l
iabilities.
For leverage ratio, it illustrates Berjaya Asset Bhd is having a constan
t growth in long run as due to the majority of the leverage ratios shows reducti
on from year 2012 to year 2014. The debts ratio for the past three years shows a
constant decline from year 2012 with the amount of 27.97% to year 2013 with the
amount of 26.44% and year 2014 with the amount of 23.13%. This is owing to the
increase of total asset from years to years. In year 2014, Berjaya Asset Bhd bou
ght a freehold land which amounting to RM27,104,000; the freehold land was recor
ded as land held for development under non-current asset which bring a big impac
t to the increase in total asset. The decrease of debts ratio indicates that Ber
jaya Asset Bhds liabilities are only a few percent of its total asset. Essentially
, the creditors only own few company's assets and the shareholders own the major
ity of the assets. The lower the debts ratio, the less?leveraged?the company is,
implying lesser?financial risk.
Meanwhile for Debt to equity ratio, it also show steady decrease from ye
ar 2012 to year 2013 which are 38.83% in year 2012 to 35.94% in year 2013 and 30
.09% on year 2014. This is in light of the fact that the total equity from year
2012 to year 2014 is increase drastically. On 9 December 2013, the Company ent
ered into a share sale agreement with D.Y.M.M. Sultan Ibrahim Ismail Ibni Almarh
um Sultan Mahmud Iskandar Al-Haj for the disposal of Berjaya Times Square Sdn Bh
d (BTSSB) ordinary share for a total cash consideration of RM250,000,000. The di
sposal was soon completed on 19 December 2013 and consequently, the company owne
d 80% of BTSSB as a subsidiary company. The amount was then recorded as non-cont
rolling interest under equity on financial year 2014, and the total equity is ra
ise on that particular years.
To sum it up, Berjaya Asset Bhd is considered as a solvent company as th
e company is the one that owns more than it owes. In other words, it has a posi
tive net worth and a manageable debt load.

Investors Perspective
Peter Baskerville (2012) mentioned that profitability ratios and market
value ratios are the key financial ratios for investors to further investigate a
s these 2 ratios help investors to determine the financial performance of the co
mpany. Profitability ratio is use to detect positive or negative trends in a com
pany's earnings and for sure positive profit margin analysis translates into pos
itive investment quality as stated by Richard Loth (n.d.). On the other hand, ma
rket value ratios are used to evaluate the current share price of a publicly-hel
d company's stock.
Based on the profitability ratio that been calculated, net profit margin
shows a huge decline from year 2012 to year 2013 which are 50.59% to 14.62%. Th
is is due to the profit of the year for year 2012 is higher than year. The main
factor that influence such a big different is that the amount of gain on disposa
l of investment properties for year 2012 is the highest among the operation year
s. Therefore, the other operating income is extremely high in year 2012 and it g
ives a direct impact to the net profit. Same goes to year 2013, the net profit m
argin had drop to 12.06%. This is on account of the company was charged for a de
ferred tax liability from the changes in investment properties amounting to RM47
,470,000 which increase the tax expenses for the particulars year. In short, we
can conclude that the company is still generating profit even there is a huge de
cline of the profit.
Another profitability ratio that the investors are advised to focus is t
he return on equity ratio. As derived from the calculation on this ratio, it sho
ws that the company is heading to inefficient using investors fund. The return on
equity ratio is decrease from year to year from 8.70% in year 2012 to 2.39% in y
ear 2013 and 2.03% in year 2014. This can be due to the decrease in net income
which caused by the increase in interest expenses, administrative expenses and t
ax expenses. In a nut shell, it can be said that Berjaya Asset Bhd do not utiliz
e investors fund effectively. But, investors should not only look into return on e
quity ratio, they should also focus on other profitability ratio as different in
dustry will have different way in using the fund as mentioned by Richard Loth (n
.d.)
Beside profitability ratios, the investors must also take into account w
ith market ratio. The market ratio for Berjaya Asset Bhd had presented a positiv
e future performance for investors to carry out investment as the Price Earnings
Ratio (P/E) is increase steadily from 5.78times in year 2012 to 22.09times in y
ear 2013 and a minor decline to 20.39times in year 2014. As according to my acco
unting course (2015), it mentioned that a higher P/E ratio indicates that invest
ors anticipate higher performance and growth in the future but this ratio is onl
y useful for investors to compare the company from the same industry. In another
words, we can conclude that the higher the P/E ratio, the more sustainable the
company in long run.
In addition, the market ratio that is recommended to investors to look i
nto is the market book ratio (M/B). The market to book ratio for Berjaya Asset B
hd is showing the share price is turning to overvalued. This is due to the marke
t book ratio is below than 1 which amounting to 0.4855 in year 2012, 0.4573 in y
ear 2013 and 0.3705 in year 2014. As refer to Management Mania (2015), it point
out that if the value of market book ratio is greater than 1, the market value o
f the?company?is greater that the valuation of equity in the?financial statement
. Conversely, if the value is lower than 1, the potential reproductive capacity
of assets?is assessed by investors as insufficient due to the amount of risk ass
ociated with the type of activity and due the volume of the share?capital. In sh
ort, we can say that Berjaya Asset Bhd had invested in some risky project and th
e share price was overvalued.
In summary, it can be said Berjaya Asset Bhd is still earning profit for
the past 3 years although there is a huge decline of profit in year 2013. Besid
es, the company do not make use of investors fund effective as the return on equit
y ratio is drop from years to years. However, Berjaya Asset Bhds is popular among
the investors as the price earnings ratio show a steady increase in year 2013 ev
en the share price is overvalued.

Managements Perspective
As mentioned by Investopedia (n.d.), efficiency ratios that are typicall
y used to analyze how well a company uses its assets and liabilities internally.
Efficiency ratios can calculate the?turnover?of?receivables, the repayment of l
iabilities, the quantity and usage of equity and the general use of inventory an
d machinery. Thus, efficiency ratio is extremely important for companys management
as to improve the daily operation.
First efficiency ratio that the companys management should look into is th
e inventory turnover ratio. Based on the calculated inventory turnover ratio, it
shows that Berjaya Asset Bhd has a very good inventory control as the company m
anaged to sell all the inventory for the past 3 years. The calculated inventory
turnover ratios are amounting to 1.27times in 2012, 1.02times in 2013 and 1.10ti
mes in 2014. The inventory turnover ratio for year 2012 is the highest among the
se 3 years as this is due to the average inventory for the year is the smallest.
Although the number of inventory was increased in the next 2 years, the company
is still able to sell off all the inventory and this had proof that the company
is managing stock in an efficient and effective ways. This is important as if t
he company cannot sell these greater amounts of inventory, it will incur storage
costs and other holding costs. Not only that, the profit of the company will al
so be affected if less stock was sold. As a conclusion, it can be said that the
management of Berjaya Asset Bhd has a very good control on the companys inventory.
Another Efficiency ratio that the companys management should concentrate i
s the average collection period. The calculation for the average collection per
iod for Berjaya Asset Bhd presented the company is quite efficient in collecting
money from its debtors. It took 80 days in year 2012, 24 days in year 2013 and
43 days in year 2014 to collect back money from trade receivable. The most effic
ient years in collecting credit from debtors is year 2013. The company took less
than 1 month in collecting debtors credit. This is due to the reason that the com
pany has less credit sales in year 2013 and it leads to lesser amount of debtors
on the particulars year. The shorter the average collection period, the tendenc
y for trade receivable convert to bad debts is lower as refer to Peter (n.d.). T
o sum it up, we can conclude that Berjaya Asset Bhd is efficient in collecting m
oney from debtors.
In the perspective of debtor of the creditors company on the other hand, t
he company should taking full advantage of the credit terms allowed by suppliers
. The company is advised to delay the payment as long as possible within the cre
dit terms as the company will have extra fund to carry out investment in certain
projects. According to the calculation of average payments period, Berjaya Asse
t Bhd is taking full advantage to settle the debts within the credit term which
they settle the debts at 90 days in year 2012, 265 days in year 2013and 204 days
in year 2014. Berjaya Asset Bhd is taking more than 8 month to settle the debts
in year 2013 as the credit purchase for year 2013 is the highest among the pass
3 years. In nature, delay payment is not a good way for company to settle its d
ebts as because there is discount allowed will be given by the supplier or credi
tors. In this scenario, the management of the company should compare the amount
of discount with the benefit of the length of the credit period allowed by the c
reditors. In short, we can conclude that Berjaya Asset Bhd is taking full advant
age on the credit period which set by the supplier.
In conclusion, the management of Berjaya Asset Bhd shows an efficient an
d effective performance on stock management, shorter collection period from debt
ors and fully utilize the credit term that gave by the creditors.

PART D ARTICLES/ NEWS CHOOSE TO SUPPORT FINDINGS.

Introduction
The largest economy issue which Malaysia currently facing was the fallen
of the currency rate. Malaysia Ringgit fall around 40% over year 2014 with the
ratio of 1: 4.26 as compared to U.S.Dollar. This is the lowest point of Malaysia
currency since 1997, which achieved the point at 4.88 ringgit. Malaysias economy
primarily relies on the commodities export like palm oil and petroleum. Due to t
he global price of oil decreasing sharply, political scandal and the introducing
of the Goods and Service Tax, it had bring it an drawbacks of slowing down the
consumer spending and showed unpopular feedback. Consequently, the economy of Ma
laysia decline substantially in 2015.
Findings
Real Estate and Housing Developers Association Chairman Datuk Jerry Chan
mentioned that the decline of the economy and falling of the currency would not
affect property sector in Malaysia. He claimed that local citizen is encouraged
to invest in the local property as it is not affected by the currency exchange
rate comparing to the investment to foreign assets. He also mentioned that Malay
sias current situation similar with the Asian financial crisis in 1997, as in that
period, investor bought local assets instead of foreign asset, and getting grea
t harvest of returns with their purchases.
The prove as shown recently, Berjaya Berhad bought back their 20% stake
of Berjaya Time Square Sdn Bhd in Kuala Lumpur from Sultan Ibrahim Ibni Almarhum
Sultan Iskandar at the same price of RM250 million in cash as the amount of dis
posal in 2013. This acquisition had caused an increase of the retained earnings
of Berjaya Assets for RM131.31 million and net asset per share of Berjaya Assets
has also increase to RM2.02 from RM1.90.
Other than that, Berjaya Assets reported the first quarters net profit (en
ded September 2015) at November, shown that there is a 62.61% increase in the ne
t profit from 7.14 Million to 11.61 Million compare to the previous year. This i
s because of the business investment and development of the property.
One of the reasons that causing the jump on net profit of Berjaya Asset
Bhd is due to the Malaysian Currency drop, most of the foreign investors begin t
o invest in Malaysia property market. Not only that, the number of tourist had i
ncrease dramatically as huge numbers of tourists are travelling and shopping in
Malaysia. Bringing revenue for the businesses operate under Berjaya Assets such
as hotel and resorts, shopping mall, gaming and restaurants.
.

As shown in the graph above, Berjaya Assets Berhad achieved the high net
income and earnings per share level among the latest years. This proved that th
e economic downfalls and dropping of the currency rate not likely bring bad effe
ct to the property sector.

PART E RECOMMENDATION AND LESSON LEARNED

From the aspect of liquidity of Berjaya Asset Berhad, some analysis calc
ulations shown that the company was unable to settle its current liabilities wit
h quick ratio which is below 1 in year 2013 and 2014. Therefore, we suggest that
Berjaya Asset Berhad should be more wisely in making purchase decision and cons
ideration in order to not overburden the companys financial performance. For examp
le, Berjaya Asset Berhad should take many aspects into account while making purc
hase decision such as the period of getting return, how much the return will rec
eive, whether worth to spend the money to do the purchasing, what is the risk of
making the purchasing decision and so on. Do make a smart choice in purchasing
is a very important element to lead the company to the success.
Furthermore, from the aspect of leverage of Berjaya Asset Berhad, it has
a reduction shown in majority of the leverage ratios of the company. For exampl
e, the debt ratio and the debt to equity ratio of the company were decreased yea
r by year. This is good to the company because the lower the debt ratio, the low
er the leverage. It means that the debt was only a few percent of the companys tot
al assets. This lower leverage was lead to lower financial risk to the company a
nd therefore, the company can avoid suffer from facing bankruptcy. This can also
help the company to attract more investors to invest in and also result in the
increases of companys capital. Berjaya Asset Berhad consider is a solvent company
as what they own more than what they owe. This is something good for us to learn
.
On the other hand, we also look at the profitability of Berjaya Asset Be
rhad. The company was faced a declined on the net profit margin due to the compa
ny had been charged of deferred tax liability from the changing of investment pr
operties. Even though the company faced declined on the net profit margin, they
can still generate profit for the company and it shows that the company is very
good in handling their sales. However, as refer to return on equity ratio, the r
atio was declined as due to the decrease in net income of the company which affe
cted by the increase in interest expenses, administrative expenses and tax expen
ses. For this issue, company is advice to reduce the administrative fees such as
insurance, office supplies as well as the usage of water and electricity. Besid
es that, we would suggest Berjaya Asset Bhd to distribute idle cash as to increa
se the return on equity. Idle cash?are funds that are not deposited in an intere
st bearing or investment. Simply said idle fund is the fund that is not particip
ating in the economic market. This is because when these idle cash piles up on a
company's balance sheet, it can drag down a company's return on equity.
 In addition, the efficiency of the company is good and positive. From th
e inventory turnover ratio, we realised that the company has a good control on t
heir inventory. Besides, they also can manage their inventories in an effective
and efficient way. They had moved their inventory and help the flow of funds in
the business efficiently and effectively. No matter how many inventories they ha
d, they are still able to sell off all those inventories. This is worth for us t
o learn how well and effective is the company use and controlling their assets.
In addition, average collection period was quite efficient in the company. In ye
ar 2013, they took less than one month to collect all the debt from debtors. Thi
s is because the shorter the length of period to collect debt, the lower the pos
sibility the trade receivable turn into bad debt. In this issue, Berjaya Asset B
erhad was very smart and efficient to minimise their expenses and losses. We als
o can learn how to minimise the risk of facing financial problem or losses from
Berjaya Asset Berhad such as do lesser credit sales. Besides, the company also s
mart in fully utilised the credit period set by suppliers. This can help the com
pany had a certain extra funds let them carry out some other projects.
Besides, in the aspect of the market ratio, Berjaya Asset Berhad was inv
ested in some risky projects that result their market book value lower than 1. T
he company should not take the risk invested in some risky projects because it w
ill lead them suffering the share price turning to overvalue. We suggest that th
e company should do a risk management proposal or risk assessments before making
decision to invest. This can help company to minimise the risk of investment an
d avoid facing losses. In addition, in the same industry, the company had a bett
er growth in the year 2013 and 2014 due to the increased in the price earning in
these two years. The higher the price earning refers to the better the performa
nce and growth of company. It also means that the company is more sustainable in
the industry. In the same industry, Berjaya Asset Berhad managed to show the po
sitive performance and growth of company through the P/E ratio, the company shou
ld keep it up in order to give investors more confident to invest more into comp
any in the future.
In conclusion, Berjaya Asset Berhad overall performance are mostly perfe
ct and should learnt by us about their operation ways, these might lead our busi
ness to success. However, some performance of the company should be improved as
well in order to achieve the organization goals.
PART F CONCLUSION
As a conclusion, it can be seen that from the year 2012 to year 2014, Be
rjaya Assets Berhad had gone through some ups and downs. However, the company ha
d managed to increase their profit, sales, assets and network until today. Based
on the?5 main financial ratios (liquidity, efficiency, leverage, profitability,
market) which were used to analyze the companys financial performance, it can be
said that this company is still in the platform of earning profit.
According to the profitability ratio, the net profit margin shows that t
here had been a huge decline in the year 2013 and slight decrease in 2014. The h
uge decline of net profit is ithree years, the company is still managed to earn
a profit. It is believes that profit-margin ratios able to give investors deeper
insight into management efficiency, however investors should not only rely on t
he net profit margin.
As refer to the current ratio under liquidity ratio, it shows that Berja
ya Asset Bhd has no problem in clearing company short-term liabilities. This is
due to Berjaya Asset Bhd was very efficient in the inventory control. Total inv
entory turnover ratio had proved the efficiency of Berjaya Asset Bhd in inventor
y control as it shows positive results in these three years.
Moreover according to price earnings (P/E) ratio which categorized under
market ratio, it shows a steady increase in year 2013 and slight decline in 201
4. This indicates that investors of Berjaya Asset Bhd received a huge profit ret
urn from the company. By doing so, it attract more and more investor to invest i
n this company. Not only that, debt ratio for this company was declining every y
ear and this will also added value to investors.
Last but not least, even thought Malaysias currency faced a drastic drop a
nd it may give a direct impact towards Malaysias economy, however Opalyn Mok (2015
) mentioned that property sectors will not be affected with this issue and it is
worth to invest in this sector.
To put it short, it can be said that Berjaya Asset Berhad is still earni
ng profit, the company is efficient in inventory control, debt ratio is decrease
every years and investor will get high return once they invest in this company.
Not only that, properties sector is now popular among the investor. Obviously,
investors are worth to invest