Consider the annual reports of Vodafone for 2021 and 2022. Using the financial ratios, presented below, you are required to 1) critically evaluate the financial statements individually across the 2-year period and cross-sectionally (i.e. company by company) and identify their main strengths and weaknesses, and 2) make recommendations for future improvement.

Note: Students are expected to comment on the change of company financial performance (income statement) and position (balance sheet) during the 2-year period of examination by looking at the main accounts and how they have changed (information may be taken from the notes to the accounts).

Profitability Ratios
Return on capital employed	Net profit before interest and taxation x 100 Share capital + Reserves + Long-term loans
Efficiency Ratios
Average settlement period for debtors	Trade debtors x 365 Credit sales
Average settlement period for creditors	Trade creditors x 365 Credit purchases
Liquidity Ratios
Current ratio	Current assets Current liabilities (creditors due within one year)
Gearing Ratios
Gearing ratio	Long-term liabilities x 100 Share capital + Reserves + Long-term liabilities
Investment Ratios
Dividend yield ratio	Dividend per share x 100 Market value per share
Price/earnings ratio (P/E)	Market value per share Earnings per share

Consolidated income statement Consolidated statement of financial position at 31 March The consolidated financial statements on pages 129 to 214 were approved by the Board of Directors and authorised for issue on 17 May 2022 and were signed on its behalf by: Consolidated income statement Consolidated statement of financial position at 31 March The consolidated financial statements on pages 129 to 214 were approved by the Board of Directors and authorised for issue on 17 May 2022 and were signed on its behalf by