Analysis of M&S Plc's Annual Report

To: Mrs Clarke

From: Financial Advisor

Analysis of M&S Plc's Annual Report

Introduction

This report will present an analysis of the annual report of Marks and Spencer Plc. Analysing the annual report helps the investors and stakeholders in knowing more about the company and its current position. The information presented in the annual report cannot be comprehended by every man. It is very difficult for a lay man to understand what the annual report consists of. A person who is an expert in the field of accounting or has knowledge about the subject can analyse the report in the best possible manner. For this purpose, Mrs. Clarke has hired me to advice her on the current position of Marks and Spencer Plc as she wants to invest in it. This analysis will help her in understanding about the company and the information presented in the annual report.

Discussion

Important Non-Financial Information

Non-Financial Information related to the company is important as it helps the investors in knowing more about the company and gaining an insight about the operations of the company. For the information presented on the initial pages of the annual report, it is important for the Mrs. Clarke to learn more about the presence of the country in different parts of the world. This helps the potential investors in knowing about the primary business of the company. Mrs. Clarke should focus on the business activities of the company and should also look at the performance of the company in terms of what the company had planned and what it has achieved.

Impact of Important Happenings

Mrs. Clarke should be informed of the global economic crisis of 2008 due to which most of the sectors are still suffering. The impact of global financial crisis has been huge and there are examples where it has caused a lot of problems for different sectors. This is the crisis that has its lasting impacts and that has caused the retail industry to decline. Marks and Spencer is an international chain and is well known for its products and quality; therefore, the company will perform better in the future. Although the impact of financial crisis has been huge, but the company has the ability to survive through crunch situations and get back right on track.

Audit Opinion and IFRS

Audit opinion is expressed by the Audit Committee which is presented in the annual report by the auditors of Marks and Spencer Plc. According to the report presented by the Marks and Spencer's auditors, the company has been doing well except a few risks that the company had to encounter during the financial crisis. In the opinion of the auditors the company has done a fair job in managing risk; however, it should take steps to make sure that the risk is minimised further. The information related to the preparation of the financial statements in accordance with IFRS helps the investors in knowing whether the company is preparing the financial statements according to guidelines mentioned in IFRS or ...