Case Study 1 Larch Properties Limiled ('LPL') specialises in construction of high-fise city centre ollice accommodation. It is an unlisted company, in which a venture capital company and an insurance company have small stakes, totalling 15% of the equity share capital There were several management changes in the campany in 2021 and there was a new CEO appointed in July 2021. LPL has been badly impacted in 2021 by a lack of confidence in the city centre office property market following the continuing effects of the Corid-19 pandemic and marry people being forced to work from home. All revenue arises in the UK. The Board of Directors believes that revenue is falling due to a lack of consumer confidence and fears of the pandemic impact not abating any time soon. The Board, however, thinks that the company has weathered the storm and the future looks a lot brighter. As a result, the Board plans to invest significantly over the next few months in new city centre land on which to build state-of-the-art office accommodation. The Board of Directors has produced a profit forecast and a cash fiow forecast for 2022 that show revenue forecast at E68 milion, and more land being purchased after 31 March 2022 using adcitional bank loan and overdrafl facilities. The financial statements for 2021 are as follows: Statement of financial position at 31 December Cash flow statement for the year to 31 December 2021 despite the the Board regards as ared to just 6 plots on ipproval so that lef 2021 indicated DN their cost. No 1 December 2021 as the Board beleves that the diminution in value is not permanent. To provide resources for this land acquisition investment, the Board had in place maximum banking facilities of 920m lion but this facility is due for renewal on 31 March 2022 . Bank borrowing is secured by a fixed charge over all the land plots owned by LPL and a fioating charge over all other assets. Required: Assume that you act for an institutional investor that is considering investing in Larch Properties Limited. Using whatever financial analysis you deem appropriate, prepare a report to evaluate whether you would recommend such an investment by the institutional shareholder. Show all workings. (35 marks - 800 maximum word limit)