The Board of Directors of Wesfarmers

1. OVERVIEW

The Board of Directors of Wesfarmers (‘WES’ on the Australian Stock Exchange) has tasked the

Finance Director of the Coles Division of WES with the analysis of an Energy Efficiency related  initiative. The initiative stems from WES’s corporate sustainability principles and the objective to  reduce carbon emissions by direct abatement. Your group is a team of Coles management accountants, assigned to assist the Coles Finance Director (i.e., your CMA Lecturer) by performing the required financial analysis. The initiative is fully outlined in Appendix One of this document.

Your group must submit and present your financial analysis in three formats:

A. Excel – financial modelling

B. Word – written report

C. PowerPoint – for presentation in-class (5 minutes per group).

Extracts from the Excel financial modelling are to be included in your Word report and PowerPoint  presentation.

2. EXCEL

The Finance Director (i.e., your Lecturer) will review your financial modelling. They will need to be  very comfortable with your technical execution. Like many senior managers, (s)he is extremely time  poor and needs to be communicated to very concisely. (S)he needs to quickly understand the design of your models, as well as assumptions and limitations.

You will email your Excel file to your lecturer for review. Here is what the Finance Director will  expect to see:

• The model is clearly structured, with supporting tables in separate tabs that build-up from a  detailed breakdown.

• Input and output tables are clear and separate.

• Tables logically present key components (e.g., costs, benefits, EBIT, assumptions and  parameters).

• The model is materially complete and comprehensive.

• The model is technically correct, e.g., cash flows are on an after-tax basis and treatments are  conventional.

• Excel extracts used in the written report or PowerPoint presentation should be appropriately  formatted, e.g., present figures in $M (e.g., $0.18M for $180,000).

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CMA – GROUP ASSIGNMENT

3. WORD

Remember, the Finance Director is your audience, so focus on the numbers. It should be very clear what the document is about, what the analysis implies, and what recommendations you are making  (if any) for future progression of the initiative.

You will lose marks if you include superfluous information. The Finance Director is highly knowledgeable about the business and will be irritated by time wasted reading an unfocussed report. Your report must present only pertinent information and key aspects of the financial  modelling.

This is a business style report for a non-academic ‘insider’. It must provide concise and easily readable information to aid decision-making. It must include explanation of major conceptual points  with simple definitions and explanation of relevant terminology (especially operational matters) and  complexities). The Finance Director is often unfamiliar with operational issues.

You MUST INCLUDE an Executive Summary. Assume that your report will be sent to the CEO so it  must be comprehensive and describe the ‘big picture’ and the main ‘numbers’ (e.g., EBIT, Capex,  NPV, IRR). The structure should also include Introduction, Discussion of Key Findings, and Conclusion. The Cover Page should not include the Executive Summary.

The Finance Director will expect your report to:

• analyse and discuss the information, and evaluate it critically.

• identify problems and suggest solutions.

• speculate about future trends and impacts.

The writing style must be a non-academic report - see the Guide to writing assignments issued by the

UTS Business School: www.uts.edu.au/node/50946/

An appropriate report format will include headings, sub-headings, bullet-points, tables and figures. It  must be easy for the Finance Director to understand the structure, and be able to selectively read sections of the whole report rather than the whole thing from start to finish. Although the report is to be in a non-academic style, you must reference appropriately and you absolutely must not plagiarise.