Balance Sheet 2009 2010 2011 2012 2013 Fiscal Year Ends 31/03/09 31/03/10 31/03/11 31/03/12 - Assets Non Current Assets Intangible 184.60 209.10 203.20 160.90 - Tangible 5,980.10 6,302.00 6,427.00...

1a:
From the given income statement, balance sheet and cash flow statement as well as ratios, it can
be concluded that the financial position of the company in question is not very robust. Because
company has very high level of net gearing ratio which is around 421% for the year 2012 and it
has remain very high since long. This indicates that company is using huge amount of debt in
comparison to equities. Present level of debt that is 421% of the equity restricts the company
from borrowing more of debt because this will increase the net gearing ratio further to a level the
result of which is increase in the financial risk of the firm. The interest coverage ratio of
company has deteriorated over time. It was 2.58 times in 2010 which fell to 1.78 times in 2012.
This indicates that the company is able to generate only 1.78 times of the total interest liabilities
of the company and any further debt infusion in the company may lead to a situation where
company would not be able to pay off its service debts through operating incomes. Also the firm
in question has witnessed the net decrease in cash inflow for year 2012. These three indicators
clearly indicate that the company should not opt to borrow money as there would not be very
favorable terms in case of the borrowed funds. Also company has been regularly paying
dividends to its shareholders and in case of debt infusion company may not be in position to pay
dividend to its shareholders...