EcobankBilocan Bank523DebtorsBank and cashCurrent liabilitiesCreditorsTaxationDividendsBank loans and overdraftNet current assetsFinanced byOrdinary share capitalShare premium accountRetained profitsRevaluation reservesTotal equity and reservesLoans19X-417,5894,69842,31816,19745980110,58128,03814,28039,7022,2292,93119,74924,90914,79339,70219X524,6936,80124,5887681,8124,02631,19423,33451,6842,8297,53025,84819X660,2707,839121,20055,6594,3023,33918,18081,48039,72090,94519X719X848,98766,7683,2739,747127,083 176,12141,1302,7123,73872,8313,4443,67229,31637,63876,896 117,58550,187 58,536103,896 138,4653,3966,7927,07714,598 11,24712,38730,975 50,42748,4686,7356,7359,42336,20755,70475,20177,35515,47735,24128,695 61,11051,684 90,945 103,896 138,465.From a review of the information above identify the areas which you would concentrateon in your analysis of the position of Belper Ltd.Produce common size profit and loss accounts for the five years and analyse these state-ments with particular reference to the profitability of Belper.Calculate the trends in the Sales and Cost of sales and comment on the informationdisclosed by your analysis.Using whatever form of analysis you consider appropriate comment on the financial riskprofile of Belper Ltd for the five years under review.Based on your analysis write a brief report for the bank advising them on whether tocontinue to provide finance for Belper Ltd.- Apart from the information arising from your analysis what other information would youadvise the bank to consider when making its decision?Discuss how your analysis would have been altered if you were carrying out the analysison behalf of a prospective shareholder. EcobankPole Pan African BankS740 5523VISAAwa TaakFinancial statement analysis.2.Given below are the summarized accounts of Helper Ltd for the past five years. These formthe basis for the questions which follow.Summarized profit and loss accounts of Belper Ltd19X5[000SalesCost of salesTrading profitDepreciationInterestNet profit before taxTaxationNet profit after taxExtraordinary items.DividendsRetained profitsRetained at start of yearRetained at end of yearFixed assetsFreehold land and buildingsLeasehold land and buildings19X4£000Plant and machineryTotal gross fixed assetsgrossDepreciation freeholdDepreciation leaseholdDepreciation plant, etc.Total depreciationNet fixed assetsTHIntangible fixed assetsGoodwillAhvestments93,93081,75012.180Patents and trade marksCurrent assetsStock1,0232,7278,4302,5175,9135,9138015.11214,63719,749Summarized balance sheets of Belper Ltd19X4£0001174,1974,31420.175116,232101,67314,5591,3802,65210.5271,7468,781(870)K7894863,97220,0317.9111,8126,09919,74925,84814,0582,3492,4908,082 11,54124,48928,602119X5£00019X6£000259,470230,33429,1363,6787,70717,7519,2708,481(15)8,4663,3395,127Notes(During 19X8 some of the freehold properties were revalued.(i) Loans amounting to £22 million were repaid during the year.(i) The extraordinary item shown in the profit and loss account in 19X8 represents thedamages received by the company from a libel action against a newspaper.(iv) No fixed assets were disposed of during the year.25,84830,97519X6£00019X7£000278,340244,80933,5314,06510,16719,2997,8335,18426,78152,52411,4664,98919X8£000372,753346,69526,0588,15114,0823,8252,6011,2244891,7133,672-1,95916,4553,73812,71730,97550,42743,692 48,46814,571 20,559 20,59829,7215,19312,56430,000 47,17255,791 89,45719X7 19X8£000£0005971473457748585,325 8,25911,27718,7475,472 8,60412,05120,20223,130 43,920 43,740 69,255807849 9369367953933033933,618 6,0638,7309,34523.034 53.091 74,823 99,606

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Accepted Answer

While analysing the financial statements there are few areas which drew attention , based on which…