2. Description: As the financial analysts of KUWAIT RESORTS COMPANY you are required to write a Memo to the Financial Manager describing the performance of the company and your suggestions on future improvements based on the following financial statements. Kuwait Resorts Company K.P.S.C. and its subsidiary State of Kuwait Consolidated Statement of Financial Position as at 31 December 2019 (All amounts are in Kuwaiti Dinar) 2019 2018 Note Assets Non-current assets Property, plant and equipment Investment properties Investment in a joint venture Investment in an associate 55,342 11,821,505 136,761 100,748 12.114,356 2,333,763 12,049,245 211,761 101,131 14,695,900 Current assets Investment at fair value through OCI Receivables and other debit balances Cash, bank accounts and time deposits 8 9 10 13,672,047 4,968,773 2,294,681 20,935,501 33,049,857 13,253,579 5,275,109 1,699,907 20,228,595 34,924,495 Total assets Equity and liabilities Equity Share capital Statutory reserve Treasury shares Change of fair value reserve Foreign currency translation reserve Retained earnings 12 13 19,646,550 3,518,019 (388,370) (107,479) (172,059) 5,608,816 28,105,477 19,646,550 3,408,071 (1,305,659) (528,523) (38,028) 5,553,142 26,735,553 Total assets 33,049,857 34,924,495 Equity and liabilities Equity Share capital Statutory reserve Treasury shares Change of fair value reserve Foreign currency translation reserve Retained earnings 11 12 13 19,646,550 3,518,019 (388,370) (107,479) (172,059) 5,608,816 28,105,477 19,646,550 3,408,071 (1,305,659) (528,523) (38,028) 5,553,142 26,735,553 Liabilities Non-current liabilities - Provision for employees' end of service indemnity Due to banks and financial institutions 898,136 14 824,635 1,574,512 2,399,152 898,136 Current liabilities Payables and other credit balances Due to banks and financial institutions 15 14 2,225,958 1,820,286 4,046,244 4,944,380 33,049,857 2,771,997 3,017, 793 5,789,790 8,188,942 34,924,495 Total liabilities Total equity and liabilities The accompanying notes form an integral part of these consolidated financial statements. Kuwait Resorts Company K.P.S.C. and its subsidiary State of Kuwait Consolidated Statement of Income for the year ended 31 December 2019 (All amounts are in Kuwaiti Dinar) Note 16 17 2019 9,677,751 (8,044,220) 1,633,531 (132,047) 529,250 (105,040) (5,408) (668,204) Operating revenue Cost of operations Gross operating profit (Loss) gain from Investment properties Cash dividends from investments Other (loss) / income / Loss from foreign exchange differences General and administrative expenses Expected credit losses provision Finance costs Profit before deductions Contribution to KFAS National Labor Support Tax Zakat expense Board of directors' remuneration Net profit for the year Earnings per share (fils) 2018 10,339,800 (8,480,959) 1,858,841 190,959 486,041 (91,019) (7,331) (621,321) (86,038) (368,305) 1,361,827 (12,256) (30,019) (9,797) (22,500) 1,287,255 (152,600) 1,099,482 (9,895) (22,789) (6,545) 1060,253 5.61 18 7.02 2019 16.95% 9.41% 3.12% Key Ratios Gross Margin Net Profit Margin Return on average assets Return on average equity Asset turnover Receivables turnover Current ratio Total debt/total equity 3.87% 0.28% 1.89% 5.174 6.477 3. Instructions: A business memo is a short document which is used to communicate information within an organization. Memos are expected to be brief, clear and easy to navigate. They are less formal than official letters but should maintain a professional style. Use the Income Statement & Statement of Financial position (Balance Sheet) & Key ratios of KUWAIT RESORTS COMPANY provided above from http://boursakuwait.com (data for year 2019, 2018) to cover following questions in your Memo: ast, 2020 1. State the purpose of your Memo. 2. Describe and interpret ratio results and provide company's performance analysis based on them. 3. Describe the weaknesses and strength of the company's financial data. 4. Provide suggestions on how to improve company's performance