TUULI PLC

FINANCIAL ANANLYSIS, APPRAISAL AND

DECISION MAKING
 Performance Liquidity
SCENARIO 1 Appaisal Appraisal

discussion of liquidity,
solvency and investment performance of the
company

Profitability Investment
Appraisal Appraisal
 Performance
Appraisal
The Cash Conversion Cycle measures the
approximate number of days it takes a company to
convert its inventory into cash after a sale to a
customer.(Ionici and Adhikari, 2017).
Investment
Appraisal
Investment appraisal refers to the techniques
used by firms and investors primarily to
determine whether an investment is profit-
making or not.(Aisbitt , 2005).
Profitability
Appraisal
Profitability ratios are financial metrics that
are used to assess a business's ability to
generate earnings relative to its revenue,
operating cost, balance sheet assets, or
shareholders' equity over time, using data
from a specific point in time(Atrill and
McLaney, 2017).
Liquidity Analysis
Liquidity ratio analysis is the use of
several ratios to determine the ability
of an organization to pay its bills in a
timely manner(Kibte, 2021). .
 RECOMMENDATIONS
Performance Appraisal The
CCC of Tuuli PLC has been
increased by 32 days company
must look into its performance
appraisal
Profitability Appraisal
Net Profit is declined by 1.7%
company should control
overhead costs
Investment Appraisal
The ROE of the company decreased to
11.8% in the year 2021 which indicates
that the capital invested is not being
efficiently used by the company.
Investors need to focus on investors
metrics
Liquidity Appraisal
Working Capital Ratio and Quick Ratio show
a positive change.
the company faces cash flow issues leading to
lower cash ratios. The company can reduce its
inventory turnover days by using process
automation, increase demand through better
strategies
 20K+
SCENARIO 2
Selection of the best
Scenario 2 includes the
alternative
decision based on the
provided 3 options to sell
the old solar panels of the
company.
Option 1
Option 1 does not seem feasible
because if the company sells 2000
units of the old stock, it will incur
£281,000 loss even after making
website changes and marketing.
The sales director point of view is
valid because huge discounts
attract users to buy more. Hence,
£760,000 would become an
opportunity cost.
Option 2

Option 2 seems feasible because 1) The

company would be able to sell both of its
products. 2) Regardless of the probability
outcome the company would likely stay
in profit.
Option 3
The Net Present Value (NPV) shows the total
value of an investment opportunity. The
calculation shows the overall value to be
negative £216,200. This option would result
in the loss for the company.
 RECOMMENDATION
The company should opt for option 2. Under option 1 the company would have an opportunity cost of £760,000 including other advertising
costs to sell the product. Option 3 would result in a financial loss of £216,200 to the company
 REFRENCES
Aisbitt, S., 2005. International reporting and interpretation.

Atrill, P. and McLaney, E. (2017) Accounting and Finance for Non-Specialists, 10th
edition.

Ionici, O. and Adhikari, A., 2017. An Integrated Approach to Teaching Financial

Statements
Analysis Using Bloomberg and Thomson Reuters. Northeastern Association of
Business, Economics and Technology, p.171.

Kibte, L. (2021) The quick ratio is a basic liquidity metric that helps determine a
company's
solvency [Blog]. Available from:
https://www.businessinsider.com/quick-ratio?r=US&IR=T [accessed 24 January
2022].
THANK YOU.