- 20 Marks
CR – Mar 2024 – Q5 – Analysis and interpretation of financial statements
Analyze and compare cash flow statements of two companies to recommend an investment choice between them.
Question
You are the Financial Consultant of Nkoso Funds, a pension fund in Ghana. Your company has identified two companies which you have been asked to evaluate as possible investments. The two companies, Trokaa Plc (Trokaa Plc) and Krokro Plc (Krokro Plc), are both publicly held and similar in size. Assume that all other publicly available information, including all climate, sustainability, and governance disclosures, have already been analysed and the decision concerning which company’s shares to acquire depends on their cash flow data given below:
Statement of cash flows for the years ended December 31, 2023 and 2022 Trokaa Plc Krokro Plc
Required:
a) Conduct a horizontal analysis for each of the two companies. (6 marks)
b) Write a report to the investment manager of Nkoso Funds discussing the relative strengths and weaknesses of each of the two companies. Conclude your report by recommending one company’s share as an investment avenue. (14 marks)
Find Related Questions by Tags, levels, etc.