FINC2012 Corporate Finance II Group Assignment Semester 1 2025 | USyd

FINC2012 Group Assignment

You have been assigned as an independent external corporate finance advisory team whose client is the Chief Financial Officer (CFO) of your assigned company. 

Your assigned company will be one of the 6 ASX-listed companies listed in the table on the next page and will be indicated by the respective company's three-letter ASX code that appears next to your Assignment Group Number on Canvas 

Your task as a corporate finance advisory team is to review and assess your assigned company's capital structure going forward. Specifically, your team has been requested to provide expert advice about the following: 

1. Key Capital Structure Considerations

Drawing on relevant academic theory and the specific characteristics of the assigned company, identify and discuss the key factors and commercial considerations that should influence decisions regarding the determination of the capital structure for the company. [5 marks] 

2. Comparative Capital Structure Analysis (2019-2024)

Examine and discuss how the capital structure trends of your assigned company, as reported in its annual reports and financial statements in the financial years ending in 2019 to 2024, compare to its peer companies. Compare these trends to those of three peer companies, at a minimum on the following key leverage metrics: i. net debt as a percentage of net debt plus equity (based on market values); ii. The ratio of net debt to EBITDA.[6 marks] 

3. Drivers of Leverage Differences Across Peer

To the extent that gearing/leverage varies across this peer group of companies, what major economic/commercial factors appear to lead the companies to adopt different capital structures? What insights does such a comparison provide to your assigned company in considering its capital structure policy? [6 marks] 

4. Capital Structure Recommendation

Based on the above analysis, provide a brief recommendation concerning the future capital structure policy of your assigned company. [5 marks] 

Presentation and Report Quality

A maximum of 3 marks will be awarded for the overall presentation, structure, and writing quality of the final report. Ensure clarity, conciseness, professionalism, and logical flow throughout your submission. [3 marks] 

TOTAL POSSIBLE MARKS: 25

Please use the following mapping to find the assigned company to your group.

For example, if you are in Group 5, your assigned company is CSL. 
If you are in group 63, you are assigned company is Coles. 
If you are in group 139, your assigned company is Rio Tinto.

Questions

1. What do I include in my Submission?

2. Do I need to separate my responses with enumerated headings for each question?

3. What are the most relevant dimensions for selecting peer firms?
4. Should I look at the capital structure of the entire industry? 

6. How do I discuss whether the company's capital structure decisions are consistent with the capital structure theories?

6. What about off-balance sheet liabilities?
7. Should I try to obtain credit ratings?
8. Do I use book values or market values when calculating capital structure measures?
9. Should I analyse total liabilities or just focus on interest-bearing debt?
10. Does the Appendix have a word limit? 
11. Should I include an executive summary, introduction, or conclusion section? 
12. Are there penalties for paraphrasing and not citing the corresponding research papers? 
13. Are there penalties for going over the word limit? 
14. Is the Appendix or References included in the word count?
15. Where is the marking rubric? It is at the bottom of the same Canvas page as the assignment question. 
16. It is recommended not to leave your submission until a few minutes before the deadline. Murphy's law tells us that technical issues tend to occur around that time.