You are a financial advisor licensed to offer investment advice to clients. One of your clients, who is a share holder in a small company, is concerned about the recent performance of the company. An analysis of the financial statements of the company for the past three years has produced the following list of ratios

2 You are a financial advisor licensed to offer investment advice to clients. One of your clients, whoisa shareholderinasmall company, is concerned about the recent performance of the company. An analysis of the financial statements of the company forthe past three years has produced the following listof ratios: year ended 31 March ... 2018 2019 2020 After tax return on capital employed 21.6% 15.9% 11.0% Net profit (before tax) to sales 41.7% 32.9% 23.3% Gross profit to sales 50.0% 41.7% 33.3% Selling and distribution expenses to sales 5.0% 5.0% 5.0% Administration costs tosales 2.5% 2.9% 3.3% Interest charges to sales 0.8% 0.8% 1.7% Sales to Net Assets (times) 0.7 0.6 0.6 Current/Working Capital ratio 0.9 1.4 Liquidity/Acid test ratio 0.6 0.6 Inventory turnover (times) 12.6 10 6.7 Average period of credit to customers (months) 0.9 1.9 1.5 Average period of credit from suppliers (months) 0.9 1.4 1.8 1 1 Required Prepare a report for submission to your client analysing the performance of the business over the past three years as shown by the above ratios. Your report should conclude with suggestions as to how the performance of the business might be improved