Gsom

Assessment for GSM |
A Critical Audit of the Financial and Business Performance of Sainsbury’s Supermarket
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Contents
Abstract 3
1. Introduction 4
1.1 About Sainsbury 4
1.2 Performance measurement system 4
1.3 Project Objectives 4
1.4 Research Questions 4
2. Literature Review 5
2.1 Primary Data 5
2.2 Secondary Data 5
2.1 Information gathering sources 5
2.1.1 Annual reports 5
2.1.2 Newspapers 5
2.1.3 Retail Magazine 6
2.1.4 Internet 6
2.1.5 Kaplan Study Notes 6
2.2 Methods Used to Collect Information 6
2.2.1 Interviews 6
2.3 Limitations of information gathering and ethical Issues 6
2.4 How to overcome the ethical issues 7
2.5 Accounting and Business techniques and their limitations 7
2.5.1 Ratio Analysis 7
2.5.2 Limitation of Ratio Analysis 7
2.6 SWOT Analysis 7
2.6.1 Limitation of SWOT Analysis 8
3. Methodology: Financial Performance and Ratio Analysis 8
3.1 Sales Growth 8
Profitability: 9
Gross Profit Margin 9
Net Profit Margin 9
Return on Capital Employed (ROCE) 9
Liquidity 10
Current Ratio 10
Inventory Holding Period (In Days) 10
Receivable Period (In Days) 11
Payable Period (In Days) 11
Risk Assessment 12
Financial Gearing 12
Interest Cover 12
Dividend Cover 13
Earnings Per Share (EPS) 13
Dividend per Share (DPS) 14
Business Performance 14
SWOT Analysis 14
Strengths 14
Strong Brand Value 14
Retail Awards 14
Financial Strength 15
Opportunities: 15
Nectar Card 15
Growing supermarket space 15
Online Channel 15
Human Capital 16
Weaknesses: 16
Geographical Limitation 16
Customer Service 16
Threats 16
Economic and market risks 16
Law and Regulations 17
New Entrant into the Market 17
Conclusion 17
Recommendation 18

Abstract                                                                                                            

1. Introduction
1.1 About Sainsbury
“Sainsbury Plc. is supermarket  founded in 1869 by John James and...