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Accounting Report Vodafone Group

603 words - 3 pages

1. Introduction

In this Report I will be looking at the last 5 years Income Statements and Balance Sheets for Vodafone Group Public Limited Company and carry out ratio analysis for my four chosen user groups.

Vodafone is one of the world’s leading mobile telecommunications operator with a total of 91,272 employees as of March 2013.

2. User Groups and ratio Analysis

2.1 Employees
Employees are interested in the company’s stability and profitability. They are after the ability of the company to pay salaries and provide employee benefits. They may also be interested in the company’s financial position and performance to assess the possibility of company expansion and career opportunities.

Ratio 2009 2010 2011 2012 2013
ROCE 4.7% 7.4% 4.5% 9.7% 4.2%
Sales Revenue per employee £518,566 £523,261 £547,137 £537,402 £486,951

Return on ...view middle of the document...

2.2 Lenders
Financers have lent money to the business and are interested in accounting information to assess if the organization can repay the money borrowed and make interest payments. Lenders don’t just analyse profitability but also stability, efficiency and the capital return on the businesses past & present investment projects. If the business is stable with a good future, lenders will be more willing to offer capital.

Ratio 2009 2010 2011 2012 2013
Gearing 31% 30% 29% 33% 35%
Long term solvency 2.3 2.4 2.4 2.2 2.0

2.3 Trade creditors or suppliers
Like lenders, trade creditors or suppliers are interested in the company’s ability to pay obligations when they become due. They are nonetheless especially interested in the company's liquidity -- its ability to pay short-term obligations.

Ratio 2009 2010 2011 2012 2013
Creditor days 7.7% 7.3% 9.7% 9.6% 9.7%
Current ratio 0.5 times 0.5 times 0.6 times 0.8 times 0.7 times

2.4 Government
Inland Revenue uses financial information to assess how much corporation tax and VAT needs to be paid. Government agencies also look at accounting information to make sure that the business is operating legally and ethically

Ratio 2009 2010 2011 2012 2013
Operating Profit margin 14.3% 21.3% 12.2% 24.1% 10.6%
Total asset turnover 0.3 0.3 0.3 0.3 0.3

3. Conclusion
Accounting information is the main means of communication between the business and stakeholders. It is a great communication tool that gives users the important information that can aid them in decision-making.
Different user groups have different objectives, however they use the same information but consider factors that directly affect their overall aims.
For example creditors look at the companies debts and working capital to assess if the customer can settle its debt. Whereas on the other hand employees look at stability and profits to answer their specific questions
So it’s the purpose of accounting information, which gives users the basis to analyse their main interests.

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