FNSINC602 Interpret and Use

Financial Statistics and Tools

Assessment 1

Ronnasit Taesuwan

ID: 13559
1. Below is a table of the selling price of bananas (B) per
kilogram in dollars compared with the number sold in of
kilograms (N).

(a) Draw a scatter diagram of the data.

B 1.50 1.98 5 6 7 8 9 12
N 250 220 180 200 190 124 67 15

N
300

250

200

150

100

50

0
0 2 4 6 8 10 12 14

(b) Estimate the degree of correlation

Answer: -0.6
2. Below is a table is data related to hours of use of a
photocopier (P) and the hours of maintenance (M).

(a) Draw a scatter diagram of the data.

P 70 55 125 90 140 100

M 6 4 8 6 15 6

M
16

14

12

10

0
50 60 70 80 90 100 110 120 130 140 150

(b) Estimate the degree of correlation

Answer: 0.7
3. Using a three-year moving average applied to growth
factors, prepare a forecast of sales for 2010.

(a) Calculate the revenue growth rate %.

 growth
Year Sales rate %.
1998 23156 6.10%
1999 24569 4.56%
2000 25689 20.62%
2001 30987 3.84%
2002 32176 4.01%
2003 33467 7.29%
2004 35908 2.51%
2005 36809 0.28%
2006 36911 5.88%
2007 39081 7.89%
2008 42164 8.60%
2009 45789 7.04%
2010 49012 2.68%
2011 50324 10.50%
2012 55609 9.53%
2013 60911 -100.00%

(b) Predict the sales for 2013.

Answer: 59272.31
(c) Graph on the same axis the functions.

Year
70000

60000

50000

40000

30000

20000

10000

0
1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

4. From the given annual report of a sample organisation

(ASX listed), calculate;

Woolworths annual report

(a) Liquidity ratios

 Current Ratio =Current Assets/ Current Liability
821k/1632K= 50%

 Quick Ratio: Formula = (Current Assets-

Inventory)/Current Liability 
1273k+53k+801k/1632k = 1.30  

 Cash ratio Formula = (Cash + Cash equivalents)/

Current liabilities
6201k/1632k = 3.79
(b) Profitability ratios

Particulars Amount
Shareholder Equity
Equity Shares, 2346 share outstanding, Par 118
value 0.05
Paid In Capital 5858
Retained Earning 13826
Total Shareholder Equity 19802
Total Assets 30011
Current Liability 8035
Total Sales 53553
Gross Profit 16147
Net Operating Profit 3028.65
Net Profit 3044

1) Return on Equity = Profit After tax / Net worth, 

                                      = 3044/19802 
                                      = 15.37%

2) Earnings Per share = Net Profit / Total no of shares

outstanding 
                                           = 3044/2346 
                                          = 1.30
 3) Return on Capital Employed = Net Operating Profit /
Capital Employed * 100
                                                         =3028.65/ (30011-8035)*100 
                                                         = 13.78% 

4) Return on Assets = Net Profit / Total Assets

                                        = 3044/30011 
                                        = 10.14%

5) Gross Profit = Gross Profit / sales * 100

                               = 16147/53553*100
                               = 30.15%

6) Net Profit = Net Profit / Sales*100

                            = 3044/53553*100 
                            = 5.68%
Woolworth’s annual report

(c) Capital structure analysis ratios:

Debt/Equity Ratio = Total Liabilities / Shareholders' Equity

=13077/10481= 2,596

(d) Capital market analysis ratios

 Dividend Pay out Ratio

= Dividends/Net Income

 Dividend Yield
= Annual Dividend per share / Current market price per
share

 Price Earnings (PE) Ratio

= Market Price of Common Stock Per Share/ Earnings
Per Share

 Market to Book Ratio

= Market Price of Common Stock Per Share/ Book Value
of Equity Per Common Share
5. What is Time Series Analysis? Research and outline key
concepts of TSA with appropriate examples.

A time series is a series of data points indexed (or listed or

graphed) in time order. Most commonly, a time series is a
sequence taken at successive equally spaced points in time.
Thus it is a sequence of discrete-time data. Examples of time
series are heights of ocean tides, counts of sunspots, and the
daily closing value of the Dow Jones Industrial Average

The TSA:
 Provides credible data on the impact of tourism and the
associated employment
 Is a standard framework for organizing statistical data
on tourism
 Is a new international standard endorsed by the UN
Statistical Commission
 Is a powerful instrument for designing economic policies
related to tourism development
 Provides data on tourism’s impact on a nation’s balance
of payments

 Provides information on tourism human resource

characteristics.
 This series appears to be stationary in the mean as it
varies about a fixed level.

Objectives of time series analysis

Time series analysis seeks to draw inferences from the data.
To do so, one sets up a probability model to represent the
data.
After the model parameters are estimated and the fit of the
model is tested, the model may be used in a variety of ways,
depending on the particular field of application.
One use of a time series model is to describe and explain
general characteristics of the series.
As an example, the series may be represented as a sum of
components representing trend (long-term movements),
seasonality (periodic movements due to seasonal variation),
and random fluctuations.
 An application is an economic time series such as
unemployment rates, where it is important to separate
seasonal fluctuations from the long-term trend. This
process is known as seasonal adjustment.

6. Research and briefly describe role and functions of the

following organisations and institutions;

(a) Reserve Bank of Australia

The role and functions of the Reserve Bank are underpinned

by various pieces of legislation. The Bank is a statutory
authority, established by an Act of Parliament, the Reserve
Bank Act 1959, which gives it specific powers and obligations.
In terms of the Act, there are two Boards: the Reserve Bank
Board and the Payments System Board.

(b) Australian Taxation Office (ATO)

The ATO's role is to effectively manage and shape the tax and
superannuation systems to support and fund services for
Australians. In this role, we administer the tax law and key
elements of the superannuation law, and provide advice to
Treasury to support the development of tax legislative
measures.

(c) Australian Bureau of Statistics (ABS)

The role of the Australian Bureau of Statistics (ABS) is to

assist and encourage informed decision-making, research
and discussion within governments and the community, by
leading a high quality, objective and responsive national
statistical service (NSS). The ABS is Australia’s official national
statistical agency, providing key official statistics on a wide
range of economic, environmental and social issues.

(d) National Statistical Service (NSS)

The role of the Australian Bureau of Statistics (ABS) is to

assist and encourage informed decision-making, research and
discussion within governments and the community, by
leading a high quality, objective and responsive national
statistical service (NSS).

(e) Australian Securities and Investments Commission (ASIC)

The Australian Securities and Investments Commission (ASIC)

is an independent Australian government body that acts as
Australia's corporate regulator. ASIC's role is to enforce and
regulate company and financial services laws to protect
Australian consumers, investors and creditors. ASIC was
established on 1 July 1998 following recommendations from
the Wallis Inquiry. ASIC's authority and scope is determined
by the Australian Securities and Investments Commission Act,
2001

(f) Australian Prudential Regulation Authority (APRA)

The role of the Australian Prudential Regulation Authority

(APRA) is developing and enforcing a robust prudential
framework of legislation, prudential standards and prudential
guidance that promotes prudent behaviour by authorized
deposit-taking institutions (ADIs), insurance companies,
superannuation funds and other financial institutions it
supervises, with the key aim of protecting the interests of
their depositors, policyholders and superannuation fund
members.

(g) Industry association data and information:

The Australian Information Industry Association (AIIA) is the

peak body representing the information and communications
technology (ICT) industry in Australia.
AIIA’s membership captures all sectors of the ICT industry,
ranging from hardware and software services to
multinational companies and local small-to-medium-sized
enterprises.
AIIA sets the strategic direction of the ICT industry, influences
public policy, engages industry stakeholders and provides
member companies with business productivity tools, advisory
services and market intelligence.

(h) Organisational data and information (public record)

Records management, also known as records and

information management, is an organizational function
devoted to the management of information in an
organization throughout its life cycle, from the time of
creation or inscription to its eventual disposition. This
includes identifying, classifying, storing, securing, retrieving,
tracking and destroying or permanently preserving records.
The ISO 15489-1: 2001 standard ("ISO 15489-1:2001")
defines records management as "[the] field of management
responsible for the efficient and systematic control of the
creation, receipt, maintenance, use and disposition of
records, including the processes for capturing and
maintaining evidence of and information about business
activities and transactions in the form of records".

The purpose of records management is part of an

organization's broader function of Governance, risk
management, and compliance and is primarily concerned
with managing the evidence of an organization's activities as
well as the reduction or mitigation of risk associated with it.

(i) International government and organisation data and

information

The role that international organizations can play depends on

the interests of their member States. States establish and
develop international organizations to achieve objectives
that they cannot achieve on their own. By the same token,
States will not permit international organizations to do things
that constitute, in the eyes of these States, interference in
their internal affairs.
This is particularly true in the very sensitive field of
international migration. The entry, economic activities,
residence rights, etc., of foreigners are viewed, to this day, as
falling under the sovereignty and reserved domain of States.
In the field of international migration, no State likes to be
told what it can or cannot do - neither by another State nor
by an international organization.