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Accounting and finance play a huge role in decision-making in a company. This report will highlight the accounting procedures and its finance for decision making in AstraZeneca. This project report aims to make a demonstration of the company environment to determine the financial aspect of the company. An analysis of the income statement will be made to highlight the financial transactions. The balance sheet of this company will also be highlighted to understand the key assets and liabilities of this organization. This report will also shed light on the cash flow analysis and overview of the company's financial diagnosis.
The AstraZeneca Company manufactures the vaccines for COVID-19 and it is a major pharmaceuticals company in the UK. On the other hand, it has also generated a good reputation by manufacturing various vaccines in the UK. It can be stated that this organization has implemented various strategies that has helped this company to gain immense profit and market reputation. It has generated fame for producing medicines for cardiovascular, oncology, infection, gastrointestinal, respiratory, neuroscience, and so on.
This pharma organization has recently gained revenue of 26,617 in the year 2020. In contrast with this, it has also gained 37,417 in 2021. Moreover, Limami et al. (2022) has said that the COVID-19 pandemic has enhanced the company's efficiency and helped it gain immense profit.
The income statement can be considered the crucial income statement of a company. Moreover, it can highlight the financial gains and losses of the organization. The gross margin of this company has described 49% (2019), 80% (2020) and 74% in the last year (2021). The assumptions of these years can be highlighted as the immense increment of this company. However, the last year has been faced few decrease in the profit margins. Analyzing this part it can be said that the company has gained a moderated gross profit margin in 2019 (Mataret al. 2021).
Figure 1: Income Statement
(Source: Created by the learner)
Based on the income statement analysis it can be said that this company has generated a gross profit of 27875 in the year 2021 and 21347 in 2020 however it can be said that the financial income of this company has increased. In addition to this, it can be assumed that the pandemic situation has helped this company to gather immense profit. Therefore, they have faced a slight decrease in the last year, which is 2021.
Table 1: Profitability ratio
(Source: created by the learner)
The gross profit has highlighted 49% in 2019, 80% in 2020 and 74% in 2021.This part has highlighted the increment of gross profit margin in these recent years.
According to the liquidity ratio, it can be analyzed that the quick ratio of this business has an outcome of the mentioned values. In 2019, the liquidity ratio has outcome of 0.68%, on the other hand, 2020 has highlighted as 0.80% and 2021 has an outcome of 0.76%.Based on that output result, it is observed that the company has better liquidity terms in the year 2020 compared to the other two years.
The balance sheet is also a major factor that helps to assume the asset values, and liabilities of the business and it also highlights the other financial and non-financial aspects of the organization that have an impact both directly and indirectly. Therefore, Whitaker et al. (2022) has said that this company has seemed to have generated increasing asset values over the years. The asset level of this company has highlighted 45814 in 2019, 47185 in 2020 and 79119 in the year 2021. According to the analysis of this company it has been found that this company has increased the asset values in the organization.
The balance sheet has highlighted 45814 in 2019, 47185 in 2020 along with 79119 in 2021. The asset volumes are higher than the liabilities in the business. On the other hand, it has a total liability of 61377 in 2019 whereas 66729 have been generated in 2020. Along with this, 105363 is an outcome of the last year. As per the analysis of this business, it can be identified that the performance of this company has been developed and it also can be assumed that the upcoming business years can be more beneficial for this organization. On the other hand, the stocks of the company have been developed in the recent year. However, this company can generate more profit values by selling their products in the business market. In association with this, it can be observed that the innovative strategies have enhanced the sustainability and trustworthiness of this business organization that has assisted to gain these market revenues.
According to the above-mentioned analysis, it can be assumed that the stock values and the current stocks have helped this company generate immense profit and the pandemic situation has created the urge to produce a huge margin of vaccines. It has also helped this business to fulfill the gap that has been generated in the pandemic situation. As opined by Rezaei and Kamali, (2022) this company has generated a huge profit in this pandemic situation as well as it has managed to gain a reputation in the business market. This business also has emerged various technologies that has helped to engage the customers into this company and also has enhanced the business in the pharmacy industry.
The return on equity can be observed by the deployment of net assets that increase the rate of return based on net assets.
As per the above return equity, it can be seen that the company has increased its income by amounting 37417 in the year 2021 compared to the previous years (Callaghan et al. 2022). It is observed that the company’s return on the assets was better in that year also. Discussing that the better availability of the assets based on the income availability. It can be defined that in the year 2021, it was resulting as 0.36, on the other hand, it was critical on the year 2020 and 2019, which was 0.40 in the both years.
Cash flow analysis can be considered as an outcome that highlights the outflow of cash as well as the inflow of cash. It helps to determine the actual cash transaction of the company and the shareholders, stakeholders and the operators of the company can have an idea of their ultimate financial transaction during the business year (Permezel et al. 2022). The cash flow analysis also has determined the cash income areas in the company. However, it can be assumed that the operational activities have helped to improve the cash inflows. The below part will consist of the cash flow of this company to analyze the ultimate cash flow of this company during these three years.
As per the analysis of the cash flow, it can be said that this company has generated 4087 as they are cash flow from operations and activities in the year 2019. In addition to these, it has also generated 6361 in 2020 whereas it has generated 7706 in the last year 2021 (Rezaei and Kamali, 2022). Relying on this party can be said that the company has increased its operation and activities that have helped to generate a profit that is constantly increasing.
1. Profitability of the company
Growth
Analyzing the current position of the company it can be said that the company has established various aspects that have helped to generate growth for the future. This company can assume as having growth for further.
Positioning
This company has competitive positioning in the pharmaceutical business market.
Margins
Based on the profit margins the operators and investors can take decision-making strategies.
Break-Even point
The break-even analysis of this company highlights 3.5% of each sale value of the respective years.
2. Company rentable positing
Return on assets
The return on an asset will be 0.11 in 2019 and remain the same in 2020 along with a downfall to 0.10 in 2021.
Return on equity
| return on equity | 0.01 | 0.08 |
|---|
The return on asset and equity margin has been mentioned above and after analyzing those parts it can be said that the company can have a better return in the coming years as it has an outcome of 0.01 in 2020 and 0.08 in 2021.
Leverage effect
The leverage aspect of this company can be considered as moderated as well as it can fulfill its obligations.
3. Financial structure
Funding
As this company has several investors as well as the funding of the company is well up to generate a good margin of profit
Debt level and self-financing
According to the financial analysis, the debt level and their financial capacity can be considered as well enough to stimulate they are own business organization in a competitive market
Ability to repay debt
As it has been seen that this company has less debt value compared with the profit margins it can be said that the company has enough ability to repay the debt within time and it can also increase its reputation in the market.
4. Company cash flow positive or negative
In case
As per the cash flow analysis, it can be visible that this company has generated a positive value rather than the previous year.
Origin of net cash flows: operating, financing, and investment activities
Cash inflow
It has been found that the cash flow of this company is mostly in favor of cash inflow. On the other hand, it has impacted the financial aspects of the company which has led to generating profit.
This project report has consisted of the financial analysis of the company. On the other hand, it has highlighted cash flow analysis, balance sheet analysis, and income statement analysis as well. In addition to these, it has also highlighted various ratios that are realized in terms of analyzing the project report. Furthermore, it has also helped to determine the financial position of this company in the business market. In addition to this, it has also represented the key areas that have enhanced the financial aspects of the company. Moreover, it helped to determine the actual cash transaction of the company.
Callaghan, C.J., Mumford, L., Curtis, R.M., Williams, S.V., Whitaker, H., Andrews, N., Bernal, J.L., Ushiro-Lumb, I., Pettigrew, G.J., Thorburn, D. and Forsythe, J.L., 2022. Real-world effectiveness of the Pfizer-BioNTech BNT162b2 and Oxford-AstraZeneca ChAdOx1-S vaccines against SARS-CoV-2 in solid organ and islet transplant recipients. Transplantation, 106(3), p.436.
Limami, Y., Khalki, L., Zaid, N., Khyatti, M., El Turk, J., Ammara, M., Mtairag, E.M., Oudghiri, M., Naya, A., Taberkant, M. and Zaid, Y., 2022, February. Oxford-AstraZeneca ChAdOx1 COVID-19 vaccine does not alter platelet aggregation. In Seminars in Thrombosis and Hemostasis (Vol. 48, No. 01, pp. 109-111). Thieme Medical Publishers, Inc.
Matar, R.H., Than, C.A., Nakanishi, H., Daniel, R.S., Smayra, K., Sim, B.L., Beran, A. and Danoun, O.A., 2022. Outcomes of patients with thromboembolic events following coronavirus disease 2019 AstraZeneca vaccination: a systematic review and meta-analysis. Blood Coagulation & Fibrinolysis, 33(2), p.90.
Permezel, F., Borojevic, B., Lau, S. and de Boer, H.H., 2022. Acute disseminated encephalomyelitis (ADEM) following recent Oxford/AstraZeneca COVID-19 vaccination. Forensic Science, Medicine, and Pathology, 18(1), pp.74-79.
Rezaei, A. and Kamali, A.R., 2022. Analysis of collaboration between AstraZeneca and the higher education sector in the UK. Industry and Higher Education, p.09504222221086520.
Whitaker, H.J., Tsang, R.S., Byford, R., Andrews, N.J., Sherlock, J., Pillai, P.S., Williams, J., Button, E., Campbell, H., Sinnathamby, M. and Victor, W., 2022. Pfizer-BioNTech and Oxford AstraZeneca COVID-19 vaccine effectiveness and immune response among individuals in clinical risk groups. Journal of Infection.
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