You are to form a group of 3 or 4 (no more, no less!) with students from the same class.
??????3?4???????????????
One person from the group must email your lecturer, stating:
???????????????
1. The full names, student numbers and email addresses of each group member.
1??????????????????????
2. Your class day and class time.
2???????????
3. A list of the thirteen companies below, arranged in your preferred order. Your lecturer will inform you by return email which company you have been assigned. It is on a first-in, first-served basis (so get your email in early to maximise your chance of getting your most preferred company assigned to your group).
3????????????????????????????????????????????????????????????????????????????????????????
AGL Nufarm Amcor Origin Energy BHP Billiton Qantas BlueScope Steel Rio Tinto Brambles Santos CSR Westfield
AGL Nufarm Amcor??Origin Energy??????????????????CSR Westfield??
Iluka
???
For the company assigned by your lecturer, you are to come up with a capital expenditure initiative.
??????????????????????
Your analysis and presentation is for the Finance Director of the company. The capital expenditure initiative must be based on an Energy Efficiency initiative that you formulate. The initiative must align to the corporate sustainability principles of the company and should reduce carbon emissions by direct abatement. Your group is a team of management accountants.
????????????????????????????????????????????????????????????????????????????????????????
Your group must submit and present your analysis in three formats:
????????????????
A. Excel – financial modelling
A. Excel–????
B. Word – written report
B.?–????
C. PowerPoint – for in-class presentation in week starting 20th May (7 minutes per group).
C. PowerPoint–?????????????7????
Extracts from Excel are to be included in your Word report and PowerPoint presentation.
????Excel??????Word?PowerPoint?????
The APPENDIX of this document outlines what you must do for the Energy Efficiency initiative.
?????????????????????
2. EXCEL
2?Excel
The Finance Director will review your financial modelling. He is under huge pressure to deliver successful Energy Efficiency initiatives that satisfy shareholder value expectations. He will need to be very comfortable with your technical execution. Like many senior managers, he is extremely time poor and needs to be communicated to very concisely. He needs to quickly understand the design of your models, as well as assumptions and limitations. Whilst he needs to know that detailed modelling has been performed, he is only interested in reviewing at a high level.
???????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????????
Excel extracts that are used in the written report or PowerPoint presentation should be appropriately formatted. For example, present figures in $millions (e.g., $0.18m for $180,000).
Excel?????????????PowerPoint?????????????????????????????0.18?180000????
You must briefly present your financial models during the in-class presentation.
????????????????????
You must also email your excel file to your lecturer.
???????Excel????????
3. WORD
3??
The Finance Director is your audience. 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. Include evaluation of how the initiative is aligned with the business’ strategy.
???????????????????????????????????????????????????????????????????
You will lose marks if you include superfluous information in the report. The Finance Director is highly knowledgeable and will be irritated by time wasted reading an unfocussed report. He wants the report to present only pertinent informati4. POWERPOINT
???????????????????????????????????????????????????????????informati4?PowerPoint
The Finance Director is your audience. Your presentation must include Excel extracts, headline statements and all critical information including:
??????????????????Excel???????????????????
Financial information [the annual impacts to earnings before interest and tax (EBIT), capital expenditure (CAPEX), net present value (NPV) and internal rate of return (IRR)].
????[??????EBIT????????????CAPEX??????NPV????????IRR?]?
Contribution towards corporate sustainability and energy efficiency.
?????????????????
You will present the PowerPoint slides during your in-class presentation. You must present the PowerPoint slides that you submit with your Word and Excel files on the due date (see Section 9).
?????????????????????????????Word?Excel???????9???
5?????
The Excel and PowerPoint files have no size restrictions.
?Excel?PowerPoint?????????
The written report must be formatted as follows:
???????????
Margins of 2.5cm (all four margins)
?2.5cm???????
Adequate spacing between lines and paragraphs
???????????
Font size of 11
????11
Maximum page length = 10 + Peer Review Sheet + Cover Page2 + Reference List
??????= 10 +?????+??2?+????
Pages beyond the maximum length will NOT be read or marked – remember that the Finance Director is extremely time-poor!
??????????????????–??????????????
6. IN-CLASS PRESENTATION
6?????
Your group’s presentation time-slot will be 7 minutes, being a 5 minute one-way presentation followed by 2 minutes of questioning by the Finance Director (i.e., your lecturer).
?????????7????5?????????2??????????????????
You MUST quickly present the structure of your Excel file as well as your PowerPoint file. During question time the Finance Director may ask questions about details in your financial models.
?????????Excel????????PowerPoint????????????????????????
You must bring to class a USB stick with both your PowerPoint and Excel file (all separate excel files must be merged into a single file for submission).
?????????USB????PowerPoint?Excel????????Excel???????????????
Your presentation should be professional, in terms of content and delivery. We expect you to do some research to learn about making a high quality presentation, e.g.:
???????????????????????????????????????????????
7. GROUPS
7??
Students must organise themselves into groups of 3 or 4 students from the same class – no other size is permissible. If you are unable to join such a group by week 5 you must contact your lecturer.
??????????????3?4?????–?????????????????????5?????????????
Expectations are that you will function collaboratively in each part of the assignment. This does not mean one person does question 1, another question 2 etc. Each question should be done as a group.
??????????????????????????1???????????2??????
When you hand-in your assignment you must include the PEER REVIEW SHEET attached to the end of this document.
???????????????????????????
We suggest you set up a Dropbox for file sharing with your group members (www.dropbox.com).
?????????Dropbox??????????www.dropbox?COM??
8. BUSINESS WRITING
8?????
The writing style must be a non-academic report - see the Guide to writing assignments issued by the UTS Business School: Remember that the Finance Director must make some difficult decisions under a lot of pressure from CEO and the Board. He needs the key facts and figures presented in a simple and concise way. Although the report is to be in a non-academic style, you must reference appropriately to avoid plagiarism.
???????????????UTS?????????????????????????????????????????????????????????????????????????????????????????????????
9. SUBMITTING YOUR FILES
9???????
Submission time and date for all formats is by 10am Tuesday 14th May. The in-class presentations are in the following week.
??????????????10???????????????????????
1. Soft copies
1????
a. TurnItIn
A. Turnitin
You must submit the Word report to TurnItIn (a system that checks for plagiarism and cheating), found on UTS Online in the Assessments folder.
?????????Turnitin???????????????????UTS????????
b. USB
B. USB
You must bring your Excel and PowerPoint files for the in-class presentation on a USB stick.
??????Excel?PowerPoint?????????USB??
c. Excel
C. Excel
You must email to your lecturer a single Excel workbook that contains all your financial modelling.
?????????Excel????????????????
2. Hard copies
2????
The hard copies must be handed-in to:
????????
Assignment Box 10, Level 3 outside the School of Accounting.
???10?3?????????
a. Word: 1 copy.
A.??1??
b. Excel: 1 copy of the key parts of your modelling - not to exceed 10 pages.
B. Excel?1?????????—????10??
c. PowerPoint: 1 copy.
C. PowerPoint?1??
A completed PEER REVIEW SHEET (as found at the end of the group assignment document) MUST be attached to the bundle of hard copies that you hand-in. Assignments without this will not be marked.
???????????????????????????????????????????????????
10. MARKING GUIDE
10?????
The main learning objective is for you, within a group, to gain practice in producing business cases. There are three components:
??????????????????????????????????????
1. Assembly of the numbers, i.e., technical correctness.
1????????????????
2. Research and discussion.
2???????
3. Presentation of the business case, i.e., communication to a senior management audience.
3????????????????????????
The business cases have an Energy Efficiency theme. This is in keeping with the UTS commitment to equip graduates with skills to positively contribute to sustainable development. Your work will be assessed as per the following 12 criteria: Word document – written report:
?????????????????UTS??????????????????????????????12????Word??–?????
1. Executive Summary and overall ‘business style’ presentation.
1?????????????????
2. Conciseness and readability of discussion of financial analysis.
2????????????????
3. Quality of information to aid decision-making.
3???????????
4. Quality of research, references and discussion of alternatives.
4?????????????????
Excel???
5. Clarity and organization of model structure.
5????????????
6. Material completeness and comprehensiveness.
6????????????
7. Technical correctness, accuracy of inputs & outputs.
7???????????????????
8. Decision-making usefulness. Presentation & Powerpoint:
8???????PowerPoint???
9. Clarity of explanation of the main issues.
9???????????
10. Smoothness of in-class presentation delivery.
10??????????
11. Apparent level of preparation for in-class presentation.
11??????????????
12. Presenters’ level of familiarity with important details.
12?????????????????
Broadly, here is what your lecturer is looking for in a high quality assignment: Word
????????????????????????
This is a business style report for a non-academic ‘insider’. It must provide concise and easily readable advice and information to aid decision-making. It must include explanation of major conceptual points with simple definitions and explanation of relevant terminology
??????????????????????????????????????????????????????????????
An appropriate structure 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. The structure must include Executive Summary, Introduction, Discussion of Key Findings, and Conclusion.
?????????????????????????????????????????????????????????????????????????????????????????????
You MUST INCLUDE an Executive Summary. It will be sent to the CEO so it must be comprehensive and describe the ‘big picture’ and the main ‘numbers’ (e.g., EBIT, NPV, IRR).
????????????????????????????“???”????“??”??????????NPV?IRR??
A high quality report will:
?????????
analyse the information, and evaluate it critically.
?????????????
identify problems and offer solutions.
????????????
form recommendations for action.
?????????
speculate about future trends and impacts.
???????????
Excel
Excel
Financial models are 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., energy saved, costs, benefits, EBIT, assumptions and parameters).
??????????????????????????????????????
The model is materially complete and comprehensive.
??????????????
The model is technically correct, e.g., cashflows are on an after-tax basis and treatments are conventional.
????????????????????????????????
Much of the impression you make will be via the pages that you print-off and hand-in, and also when you present the models in-class. If the lecturer is unsure of your work, he will not be able to give you many marks.
????????????????????????????????????????????????????????????
PowerPoint
PowerPoint
Your presentation needs to contain all the important information. The Finance Director will not have read your Word document or Excel file prior to your presentation – so it needs to include all the important information.
???????????????????????????Word???Excel?????????–?????????????????
High quality PowerPoint slides have clear messages, are uncluttered and contain essential information only. Here are the main criteria:
????PowerPoint????????????????????????????
Introduction - purpose explained; concise and to the point.
????????????
Explanation and illustration of major conceptual points. Definition and explanation
????????????????
of relevant terminology.
?????
Organisation and development of material - continuity in the flow of ideas.
????????-??????????
Audience interest. Were the main issues explained in an easy to understand manner.
??????????????????????????
Presentation to time – too short; too long.
??–????????
Concluding remarks - effectiveness of summary comments.
?????????
Much of the impression you make will be when you present the slides in-class. At the end of your presentation, you will be asked tough questions. All group members should be present so that the person best placed to answer a particular question is present (even if they are not one of the presenters).
??????????????????????????????????????????????????????????????????????
11. REFERENCE DOCUMENTS
11?????
PRIMARY
???
The company that your lecturer will assign to you will have its own Sustainability Reporting documents for you to study and reference.
????????????????????????????????
?
i. Cooremans, C., 2011, Make it Strategic! Financial investment logic is not enough. Energy Efficiency (download as PDF from UTS Library online)
?cooremans?C?2011?????????????????????????PDF?????????????
ii. Department of Resources, Energy and Tourism (RET). 2010. Energy Efficiency Opportunities: Representative Assessment Guide, URL:
II?????????????RET??2010???????????????????URL?
APPENDIX:
???
The Finance Director has fully delegated the conceptual development of this business case to your group. Your group must conceptualise an Energy Efficiency initiative, for a clearly articulated part of the company.
????????????????????????????????????????????????????
You will find a large number of possible ideas on the internet and via the reference documents. You can also come up with your own idea. For example, the project could be a change in the administration, functional or operational part of a division. Adoption of changes already made in other divisions will score you lower marks than would a more complex project like a process (operational) change.
??????????????????????????????????????????????????????????????????????????????????????????????????????????
Your concept-stage analysis must include high level financial analysis, underpinned by clearly disclosed assumptions and proxies where needed. You should recommend what future steps might be taken to progress the analysis through the feasibility and approval request stages. Or you may even find that your concept has inadequate financial benefits to satisfy normal investment criteria (assume a hurdle rate of 12.5%), in which case you should argue why the project may have merit regardless.
?????????????????????????????????????????????????????????????????????????????????????????????????????????12.5%????????????????????????????
Tasks:
???
Discuss whether or not the initiative falls under Scope 1, 2 or 3 of the Clean Energy Act 2011 (see footnote on previous page). Include appropriate treatment of carbon tax in financial analyses – this is critical. 3
??????????1?2?3?2011?????????????????????????????????????–?3
Prepare a financial model using publically available data and sensible assumptions. Your outputs should include (where appropriate): annual impacts to COGS, GP, Period Expenses, EBIT, CAPEX, and NPV and IRR.
?????????????????????????????????????????????GP?????????????????NPV?IRR?
Provide a table of the parameters and assumptions in your financial model, with appropriate referencing.
??????????????????????????
Your report must include:
?????????
o A concise description of the project and assumptions, clearly articulating which parts
O?????????????????????
of the company would be affected.
?????????
o Appropriate tables summarising and detailing the financial analyses that you have performed.
?????????????????????
o The reasons why the company should (or should not) progress the project into further (i.e., feasibility) analysis.
??????????????????????????????????
o The costs and benefits of your project, including ‘intangible’ costs and benefits which you may not be able to measure (such as branding).
???????????????“??????????????????????
o An evaluation of the extent to which the project is aligned with the company’s strategy and how they contribute to the overall goal of energy saving and direct emission abatement.
??????????????????????????????????????
If you are unsure whether your project idea is truly an ‘Energy Efficiency’ initiative, email your lecturer and ask him.
?????????????????????“????”????????????
?
i. Cooremans, C., 2011, Make it Strategic! Financial investment logic is not enough. Energy Efficiency (download as PDF from UTS Library online)
?cooremans?C?2011?????????????????????????PDF?????????????
ii. Department of Resources, Energy and Tourism (RET). 2010. Energy Efficiency Opportunities: Representative Assessment Guide, URL:
II?????????????RET??2010???????????????????URL?
APPENDIX:
???
The Finance Director has fully delegated the conceptual development of this business case to your group. Your group must conceptualise an Energy Efficiency initiative, for a clearly articulated part of the company.
????????????????????????????????????????????????????
You will find a large number of possible ideas on the internet and via the reference documents. You can also come up with your own idea. For example, the project could be a change in the administration, functional or operational part of a division. Adoption of changes already made in other divisions will score you lower marks than would a more complex project like a process (operational) change.
??????????????????????????????????????????????????????????????????????????????????????????????????????????
Your concept-stage analysis must include high level financial analysis, underpinned by clearly disclosed assumptions and proxies where needed. You should recommend what future steps might be taken to progress the analysis through the feasibility and approval request stages. Or you may even find that your concept has inadequate financial benefits to satisfy normal investment criteria (assume a hurdle rate of 12.5%), in which case you should argue why the project may have merit regardless.
?????????????????????????????????????????????????????????????????????????????????????????????????????????12.5%????????????????????????????
Tasks:
???
Discuss whether or not the initiative falls under Scope 1, 2 or 3 of the Clean Energy Act 2011 (see footnote on previous page). Include appropriate treatment of carbon tax in financial analyses – this is critical. 3
??????????1?2?3?2011?????????????????????????????????????–?3
Prepare a financial model using publically available data and sensible assumptions. Your outputs should include (where appropriate): annual impacts to COGS, GP, Period Expenses, EBIT, CAPEX, and NPV and IRR.
?????????????????????????????????????????????GP?????????????????NPV?IRR?
Provide a table of the parameters and assumptions in your financial model, with appropriate referencing.
??????????????????????????
Your report must include:
?????????
o A concise description of the project and assumptions, clearly articulating which parts
O?????????????????????
of the company would be affected.
?????????
o Appropriate tables summarising and detailing the financial analyses that you have performed.
?????????????????????
o The reasons why the company should (or should not) progress the project into further (i.e., feasibility) analysis.
??????????????????????????????????
o The costs and benefits of your project, including ‘intangible’ costs and benefits which you may not be able to measure (such as branding).
???????????????“??????????????????????
o An evaluation of the extent to which the project is aligned with the company’s strategy and how they contribute to the overall goal of energy saving and direct emission abatement.
??????????????????????????????????????
If you are unsure whether your project idea is truly an ‘Energy Efficiency’ initiative, email your lecturer and ask him.
?????????????????????“????”????????????