financial ratio and interpretation

APPENDIX B

A. Introduction Overview of All the Companies Chosen 1.1 The Store Supermarket & Departmental Store According to the research that we had conducted, we analyzed that The Store Supermarket & Departmental Store is the only retailers with outlets in Malaysia. The current chairperson of the company is Dato Sri Md Kamal Bin Bilal and it was established in year 1968 (The Store (M) Bhd. Annual Report, 2013). The Store Corporation Berhad has been listed on Bursa Malaysia since 3 March 1994.In Malaysia, The Store is considered as the oldest and largest existing supermarket and departmental chain by The Malaysia Book of Records since year 2001 (The Store, n.d.). They sells different variety of products such as various types of food and beverage, electrical appliances, footwear, bags, household items, baby and childrens products, cosmetic and others. The Store currently has 48 outlets across major cities in Malaysia which providing good and services to different income level shoppers. Their outlets include The Store Ampang in Selangor, The Store Batu Pahat in Johor, The Store Grik in Perak, The Store Kangar in Perlis, The Store Kuala Terengganu in Terengganu and so on.

Its objective is to develop and maintain a positive relationship with all shareholders and stakeholders through active two-way communication and to promote and demonstrate a high standard of integrity and transparency through timely, accurate, quality and full disclosures (The Store, n.d.). The annual profit for The Store in 2013 is RM20, 774,000 (The Store (M) Bhd. Annual Report, 2013).

Lastly, The Store Supermarket & Departmental Store is conceptualized with the aim of offering more value for shopping in no-frills environment, by providing good quality products at low prices and ensuring comprehensive services to shoppers.

1.2 Aeon Co. (M) Berhad

Aeon Co. (M) Berhad is a leading retailer in Malaysia with total revenue of RM3.51 billion for the financial year under review (Aeon Mall, n.d.). This company was founded in year 1758, being established in September 1926 and being set up in Malaysia in year 1984. According to the Aeon annual report 2013, in 1983, Dr. Mahathir visited Tokyo to meet the Jusco Co. Ltd. President, Mr. Takuya Okada to discuss the preposition of bringing Jusco name to Malaysia and the talks ended in a positive note.The companys current independent non-executive chairperson is Dato Abdullah bin Mohd Yusof. The AEON name today is well established among Malaysians as well as foreigners, especially due to its association with the international AEON group of Companies. Aeon provides various types of service for example, apparel, footwear specialty, convenience, forecourt store, department store, discount department store, discount store, pharmacy, hypermarket, supermarket and other specialty. There are also cinema and some entertainments in Aeon.

Aeon has a lot of outlets in Malaysia such as AEON Taman Maluri Shopping Centre in Kuala Lumpur, AEON mall Kulaijaya in Johor, Kinta City Shopping Centre in Perak, AEON mall Bukit Mertajam in Penang and so forth. Aeons company slogan is Sharing a sense of lively participation (Aeon Mall, n.d.). It means that they want to help their customers to enhance their lifestyles by offering new ideas through the creation of vibrant communities and creating centers for excitement, fun and lifestyle enhancement.

Basically, Aeon is carrying with the vision of Customer first (Aeon Mall, n.d.). This means the company is focusing on customer orientation. It has consistently fulfilled the needs of customers and their communities by concerning all stages of its business, from planning, development and construction to leasing and operation. Besides, Aeon helps its customers to enhance their lifestyles by offering new ideas through the creation of vibrant communities and creating centers for excitement, fun and lifestyle enhancement and that is the companys mission.1.3 Parkson Holdings Berhad

Parkson Retail Group Limited (PGRL) is the subsidiary of Parkson Holdings Berhad listed on the Singapore Stock Exchange and Hong Kong Stock Exchange respectively (Parkson, n.d.). It is the largest department store in Malaysia and was founded in year 1987.

Heng Jem Cheng is the current chairperson in Parkson Holdings Berhad. The companys different outlets have undergone an evolution that sees it moving forward into the 21st century with resilience. The examples for its outlets are Parkson Petani Parade in Kedah, Parkson Holiday Plaza in Johor, Parkson KLCC in Kuala Lumpur, Parkson Terminal 1 in Negeri Sembilan, Parkson Ipoh Parade in Perak and so on. From the different brands it carries to the new services it now offers, Parkson has indeed kept up with its customers needs.

Parkson provides products like cosmetics, furniture, fashion clothing, branded brands products, bags, baby and childrens products, electrical appliances and others. Its current net income is RM436,442,000 (Parkson Holdings Berhad Annual Report, 2013). Its vision is to be Asias leading department store group. It does not want to be considered as a follower of what the others are doing. Instead, it wants to be the leader in all things new.

On the other hand, Parksons mission is to inspire our people to delight our customer. They build strong and long-standing relationship with key business partners and customers and this is why Parkson is a successful company now (Parkson, n.d.).B. Evaluation of the Companies Profitability and Liquidity

Profitability:

CompaniesWorkingsNet Profit Margin (%)

Year 2012Year 2013Year 2012Year 2013

Aeon Co. (M) Bhd= 0.0872= 0.08738.728.73

Parkson Holdings Bhd= 0.4984= 0.3190

49.8431.90

The Store Corporation Bhd= 0.0070= 0.0111

0.701.11

I. Net Profit Margin (Net Profit / Sales)

The table above shows that Aeon earned a net profit of RM0.09 for every RM1 of sales in both 2012 and 2013. Its net profit margin had increased slightly by 0.01% from 2012 to 2013. Besides, Parkson had a net profit of RM0.50 for every RM1 of sales in 2012 and RM0.32 for every RM1 of sales in 2013. The net profit margin of Parkson had decreased by 17.94%. For The Store, it only earned RM0.01 net profit for every RM1 of sales in 2012 and 2013. However, The Stores net profit margin had increased by 0.41% from 2012 to 2013. In short, Parkson had suffered a great decline of net profit margin whereas the other two companies were having a slight improvement in their respective net profit margin.CompaniesWorkingsOperating Profit Margin (%)


Aeon Co. (M) Bhd= 0.1198= 0.123211.9812.32

Parkson Holdings Bhd= 0.6228= 0.419562.2841.95


2.172.54

II. Operating Profit Margin (Operating Profit / Sales)

Furthermore, we can see from the table above that Aeon gained an operating profit of RM0.12 for every RM1 of sales in 2012 and 2013. The operating profit margin of Aeon had increased from 11.98% to 12.32%. Parkson earned an operating profit of RM0.62 for every RM1 of sales in 2012 while RM0.42 for every RM1 of sales in 2013. Its operating profit had declined significantly by 20.33% from 2012 to 2013. Moreover, The Store had an operating profit of RM0.02 for every RM1 of sales in 2012 and RM0.03 for every RM1 of sales in 2013. The operating profit margin of The Store had increased slightly by 0.37%. In brief, Parkson experienced a major drop of operating profit margin when Aeon and The Store had an increase in their operating profit margin.CompaniesWorkingsReturn On Asset (%)


Aeon Co. (M) Bhd= 0.0793= 0.07657.937.65



1.151.85

III. Return On Asset (Net Profit / Total Assets)

In addition, we can observe that Aeon was able to gain a net profit of RM0.08 for every RM1 of total assets used in 2012 and 2013. However, there is a slight decline of 0.28% in its return on asset from 2012 to 2013. As focusing on Parkson, it was earning a net profit of RM0.09 for every RM1 of total assets possessed in 2012 and RM0.05 for every RM1 of total assets utilized in 2013. Its return on asset had decreased markedly by 3.51% from 2012 to 2013. In 2012, The Store gained a net profit of RM 0.01 for every RM1 of assets used in 2012 while RM0.02 for every RM1 of assets possessed in 2013. Although the net profit earned by The Store is relatively low, it had raised by 0.7% from 2012 to 2013.CompaniesWorkingsReturn On Equity (%)


Aeon Co. (M) Bhd= 0.1449

= 0.140514.4914.05



3.034.64

IV. Return On Equity (Net Profit / Total Equity)

From the Bar chart 2.4 above, for every RM1 of total equity possessed, Aeon earned a net profit of RM0.14 in both 2012 and 2013. Its return on equity had declined slightly by 0.44% from 2012 to 2013. As for Parkson, for every RM1 of total equity it had, it gained a net profit of RM0.16 in 2012 and RM0.10 in 2013. However, there is a marked decrease in its return on equity by 5.94% from 2012 to 2013. For The Store, it earned net profit of RM0.03 for every RM1 of total equity possessed in 2012 and RM0.05 for every RM1 of total equity possessed in 2013. We can observe an increase in its return on equity by 1.61% from 2012 to 2013. Generally, the return on equity of the companies had decreased from 2012 to 2013 except The Store.

Liquidity / Solvency:CompaniesWorkingsCurrent Ratio (x)


Aeon Co. (M) Bhd= 0.7857= 0.671478.5767.14

Parkson Holdings Bhd= 1.8569

= 1.8589

185.69185.89


109.10126.16

V. Current Ratio (Current Assets / Current Liabilities)

On the other hand, Aeon had RM0.79 in current assets for every RM1 in current liabilities in 2012 and RM0.67 in current assets for every RM1 in current liabilities in 2013. It had its current liabilities covered 78.57 times over in 2012 while 67.14 times over in 2013. Besides, Parkson possessed RM1.86 in current assets for every RM1 in current liabilities in both 2012 and 2013. The current ratio of Parkson had increased slightly by 0.2 times from 2012 to 2013. As for The Store, it had RM1.09 in current assets for every RM1 in current liabilities in 2012 while RM1.26 in current assets for every RM1 in current liabilities in 2013. Its current ratio had increased by 17.06 times from 2012 to 2013.

CompaniesWorkingsAcid Test Ratio (x)


Aeon Co. (M) Bhd= 0.4731= 0.330847.3133.08



49.7572.48

VI. Acid Test Ratio ((Current Assets Inventory) / Current Liabilities))

By observing the bar chart above, we know that Aeon had RM0.47 in liquid current assets for every RM1 in current liabilities in 2012 while RM0.33 in liquid current assets for every RM1 in current liabilities in 2013. Aeons acid test ratio had decreased by 14.23 times from 2012 to 2013. For Parkson, it had RM1.72 in liquid current assets for every RM1 in current liabilities in 2012 and RM1.73 in liquid current assets for every RM1 in current liabilities in 2013. There was a slight improvement in Parksons acid test ratio which is from 172.09 times in 2012 to 172.90 times in 2013. In 2012, The Store possessed RM0.50 in liquid current assets for every RM1 in current liabilities whereas in 2013, it had RM0.72 in liquid current assets for every RM1 in current liabilities. Its acid test ratio had increased by 22.73 times from 2012 to 2013. Generally, the companies had improvement on their acid test ratio except Aeon.

C. An Assessment on Any Non-financial InformationParkson Holdings Bhd

According to the annual report 2013, Parkson acquired ODEL PLC in 2013 because it intends to possess larger market share in fashion and apparel, cosmetics and accessories in next financial year. By doing this, Parkson can attract customers from young generation. ODEL PLC is an online fashion store which is listed on Colombo Stock Exchange. ODEL is Sri Lanka's first example of a retailing company. Starting out as a single company, focusing on the retail garment trade, ODEL has developed over years and become the first department store in Sri Lanka.Furthermore, Parkson bought a new land located in Melaka worth 93million (The Edge Malaysia, 2012). It also plans to expand its business to Cambodia by purchasing a 7-storey mall in Phnom Penh. The first self-owned retail mall is opened in Kuala Lumpur. This shows that Parkson focuses shopping mall business because it generates large profit (Parkson, n.d.).Not only this, Lion-Parkson Foundation set up funds for charity, scientific research and education. In charity, Lion Group Medical Assistance Fund is making donation to the patients which need medical assistance urgently. In education, it offers scholarship to the excellent students. In addition, Lion-Parkson sponsors dialysis machines and community health programmes (The Store Bhd. Annual Report, 2013).On the other hand, Parkson Holding Bhd signed a deal as the anchor retailers for the Perda City Mall (PCM) which is the largest mall in Seberang Perai, Penang which is soon to be opened and the company is targeting to add some 10% more retail space in the country each year (Malaysian Investment Development Authority, 2014). Meanwhile Parkson and Econsave Cash & Carry Sdn Bhd signed as the anchor retailers (PCM). Some of the tenants will be McDonald's, KFC, Pizza Hut, Old Town Kopitiam, Giordano and also Switch Apple Store which will assist in attracting a lot of consumers to come for consumption. The retail store will be located at the heart of the new Perda Township, in between Seberang Jaya and Bukit Mertajam, Penang. The mall can be easily accessible and is surrounded by high catchment population of over 900,000 people with more than 100,000 of them staying within a 5km-radius from the mall.The Store Corporation Bhd.

The Store is concerned about its company social responsibilities. According to the annual report 2013, The Store raised RM 100,000 to 10 old folks home in 8 months time. Not only this, The Store also launched MyKasih programme and raised another RM 100,000 to the underprivileged families. The latest charity campaign is to help 7 disabled people association from 2013 to 2014 (The Store Bhd. Annual Report, 2013). The Store also gives aid to Yayasan Budi Penyayang Malaysia and Breast Cancer Welfare Association Malaysia (BCWA) by donating RM 10,200.

The Store celebrated its 45th anniversary in 2013. It is launching a series of activities to give benefits to its customers and shareholders loyalty. Super Bonanza Anniversary Rewards is one of the contests to appreciate its loyal customers (The Store Bhd. Annual Report, 2013).Moreover, The Store had established in-house learning and development programme to its employees to give better service to the customers. Not only this, Certificate of Anugerah Kedai Pilihan Rakyat 1Malaysia (AKPR1M) is awarded to 17 The Store outlets by the Ministry of Domestic Trade. This is to show recognition to The Store about its position in retail industry (The Store Bhd. Annual Report, 2013).On 26th September 2014, the launching of new retail store at Kota Bharu, Jalan Padang Garong gave a new image of the company retail store to the consumers (The Store, 2014). The outlet now has a fresh new look and a wider range of products that should please the shoppers. The shopping environment tends to be more comfortable now where the interior has a more contemporary dcor and layout, with brighter lightings and spacious aisles for shoppers to access sections of their choice with ease. This shows that the company is now expanding its business.Aeon Co. (M) Bhd

Aeon is planning to diversify its business into electronics and furniture shop. The first Aeon shop opened is in Shah Alam. With celebrating its 30 years anniversary, a one year celebration A New Beginning with You is established to express the appreciation to its customers (Aeon (M) Bhd. Annual Report, 2013).According to annual report 2013, Aeon is making some changes and tries to become a leading retail shop in Malaysia. Aeon focuses in enhancing customers shopping and entertainment experience in this new era. It will transform its mall into a modern lifestyle hub to sustain its position in retail industry. (Aeon (M) Bhd. Annual Report, 2013)Besides, Aeon is growing stronger because of the best customer service. Aeon aims to achieve a new milestone in its customer service by providing in house training and sending some potential employees to Japan. Aeons charity programme, With All Our Hearts will continue making contribution to the society by focusing on childrens welfare. Aeon Co. (M) Bhd is buying a piece of freehold land in Batu Pahat, Johor for RM34.85 million to build a new shopping Centre (Aeon Buys Land, 2014). In a filing with Bursa Malaysia, Aeon said the acquisition is in line with its strategy to accelerate the expansion of its retail business through opening of new malls and outlets.On the other hand, AEON Malaysia became the single biggest donor to theSun Typhoon Haiyan Relief Fund when the company contributed RM100, 000 to help alleviate the suffering of the victims (AEON Contributes RM100,000, 2013).After the typhoon hit the Philippines on November 8, AEON Malaysia was moved to be part of the cause in channeling financial aid to affected areas. Through its own donation campaign, which commenced nationwide on Nov 15, AEON successfully raised RM39, 000 from the contributions of shoppers, business partners and employees. Donation boxes were placed at all of its retail outlets, credit service counters and branch offices throughout the country. In addition to the collection, the charity arm of the company, "With All Our Hearts" Malaysian AEON Foundation, also contributed RM61, 000 to the fund.

In addition, Aeon Co (M) Bhd is making headway in its plans to expand to Kuching and Kota Baru by 2016 (Aeon Will Go to Kuching, 2014). The company is planning its expansion to the two cities, with the land for the new stores already being identified. Aeon has targeted to expand into Kedah, Kelantan, Terengganu, Sabah and Sarawak over the next five years. This year alone, Aeon will open three new Aeon outlets as well as two MaxValu stores. Two of the three new outlets will be part of the new shopping centres in Bukit Mertajam and Taiping. It will also be an anchor tenant in a shopping mall in the Kuala Lumpur business district.Last but not least, Aeon established its New Business Promotion Division (New business project) to make better use of its expertise in the development of multiple shopping malls with a view to finding new business opportunities. By creating new business that exploits the potential 20 to 30 years from now, Aeon thought it was necessary for the Company to have a new business mainstay. Instead, the company is studying how to implement business projects that make use of it strengths and the experience they have accumulated in the development, running, and management of Malls in suburban areas (Aeon Mall, n.d.).

D. The Proposal, Opinion and Suggestion for Our Clients as to the Best Company to Invest in According to the analysis of Aeon Co. (M) Bhd., Parkson Holding Berhad (PHB) and The Store Corporation Berhad, as a financial advisor, Aeon is suggested to client as the best company to invest in. We had carried out the financial analysis throughout these three companies; we found that PHB had suffered a decline of net profit in year 2012 to 2013 whereas the other two companies were having a slight improvement in their respective net profit ratio. In this circumstance, the ratio would produce a high percentage, but the performance of the company would certainly not be as good as it ought to have been. Moreover, PHB experienced a major drop of operating profit margin when Aeon and The store had an increase in their operating profit margin. In addition, we observe that the performance for Aeon and The Store are more stable than Parkson in which the company was facing a decrease of net profit in the end of financial year 2013.

Generally, PHB has the highest financial ratios that we had calculated in part B, but all the ratios are decreasing from year 2012 to 2013. This shows that there are some management problems in its operation, or we can assume that investing in this company is an uncertainty for the investor. To invest in a company, the investor will just focus on how much the profit earned in the particular year and the dividend paid. So, for PHB which was dealing with a decrease in net profit margin is not a suitable choice for investor to invest.

Besides, all the financial ratios of The Store are the lowest as compared to Aeon and PHB, even though the financial ratios of The Store are increasing from 2012 to 2013. From the perspective of investor, it is better to get higher return on profit and dividend paid by the company, we analyzed that The Store is the company which paid the lowest dividend among the three companies.

Furthermore, Aeon is the company that has the highest rate of return on the net profit among the three companies. In addition, the dividend which investor gets from PHB is on the average as compared to Aeon and The Store. For Aeon, it paid the highest dividends to its shareholders and investors in 2013. It is the most considerable company for investor to invest in.

Furthermore, we analyzed the liquidity ratio for three companies. The results show that among these three companies,

Obviously, Aeon is the prevailing enterprise within these three companies. Based on analysis (Part B), Aeon has a stable tendency of profitability - it gives higher returns but lower risk to its investor and this is the what investors desire to. On the other hand, even though PHB has the highest profitability within the companies, however it has a dramatic drop from 2012 to 2013. This situation absolutely worries investors since an unpredictable future happens for investing. They will feel anxious and doubt that whether PHB has a considerably declined in continuous years. In aspect of investors, PHB gives certain risk for them to invest in. In addition, although The Store has a slight increase in profitability, yet it has the lowest profitability among the companies. It gives lower returns but the higher risk for investors. In evidence, it is not the best company chosen to invest in. From the three companies histories, Aeon is clearly stated as the best company to invest in. Aeon, which was called Jaya Jusco at the time, was set up in Malaysia in 1984. 30 years later, Aeon has 99 outlets in Malaysia. In 2014, there are some new outlets continually started up in the country. This shows that Aeon has the potential to continually grow in future - it has the strong and powerful ability to expand its businesses throughout Malaysia. This is a marvellous news for investors because the higher incomes and profit gained by company, the higher returns would be received by investors. On the other hand, PHB started up its business in Asia in 1993. 21 years later, there are a total of 38 stores in Malaysia. It is apparently lesser than Aeons outlets, indirectly causing investors to have less confidence to invest in PHB. Moreover, The Store was established in 1968. In 2001, it had 74 outlets in Malaysia. However, there is no more achievement after 2001. It is unbelievable that there are a miserable number of outlets in 2014 - there is only one retail store started up at Kota Bharu. In perspective of investors, it has smaller potential to expand it businesses. Therefore, the clients are not encouraged to invest in it. In terms of evaluation of companies profitability and liquidity (part B), Aeon is the best company to invest in. It shows that it has stunning ability of financial management when operating businesses. It can remain a stable profitability year by year, and provide higher returns but lower risks to its investors comparing to other companies. This causes investors are fully confident to invest in it. On the other hand, PHB seems to have serious problems in its internal part of operation there are a large number of finance losses. It is easily to find out that its profitability and liquidity are substantially fallen from 2012 to 2013. Besides, the profitability and liquidity of The Store is the lowest within three companies. This proves that it absolutely lacks of superior ability of financial management, causing a distinction occurs on finance of Aeon and PHB. Target consumer of companies is also one of the considerable elements in choosing the best company to invest in. In comparison, Aeon is suggested for client as the best company to invest in. This is because Aeon has a bigger targeted consumer range- it is consisted of normal income society and also higher income society. Furthermore, the selling price of goods sold with good quality is affordable and acceptable for its target consumers. This brings higher revenue and profit to company since consumers could and willing to consume at Aeon. When higher profit Aeon earned, higher returns could be received by investors. Moreover, PHB only targeted the specific range of consumer - it is almost consisted of higher income societies. This is because the goods sold are imported from foreign countries and caused the setting price is very high for the consumers. In addition, even though The Store has almost same target consumers with Aeon, however its profitability is the lowest. In order to boost the sales, there is a lot of promotions hold. The Store even more sets the selling price in cheap. Yet, cheap means no quality in consumer minds. Thus, the number of consumer consume is dropped year by year. As a result, the profit earned by The Store is lesser. This reflects investor would receive lesser returns if they invest in The Store.We also evaluated the dividends paid by each company in year 2012 to 2013. Below is the summary of the dividends paid by three companies:

CompaniesDividend paid (Sen)

Year 2012Year 2013

Aeon Co. (M) Bhd17.2522.00

Parkson Holdings Bhd16.0018.00

The Store Corporation Bhd3.753.75

From the graph above, we can analyze that the dividend paid by Aeon in year 2012 and 2013 is highest among these three companies. The amount paid per share is 22sen in year 2013, which is increasing 4.75sen compare with 2012. For investor who invests in the company can enjoy more dividends paid in year 2013. We estimated that the sale performance and also net profit of Aeon in 2014 will also be considerable. According to Adeline Chua Phaik Harn The social responsibility in marketing 2014, as companies can be benefit from their contributions to society and at the same time minimize the negative impact they have on the natural and social environment. Social responsibility demands that marketers accept an obligation to give equal weight to profit, consumer satisfaction, and social well-being in evaluating their firms performance. In line with the principle "Peace, People and Community", AEON Corporate Social Responsibility is asserted to encourage a positive impact the environment, consumers and communities. Aeon is good in its corporate social responsibility (CSR) programs. This company believes that a green environment is the basis for a better life. Aeon had developed a comprehensive ecology program to address the global warming issue and aim to significantly eliminate carbon dioxide (CO2) emissions. To create higher environmental awareness and educate younger generations on the importance of environment protection, they have involved the participation of various parties, including staff members, customers, students, Non-Governmental Organizations (NGOs), government agencies and other communities, in every program initiated by the company.This show that Aeon is more concern toward the society and respond to consumers growing concern about ecological issues. So we can conclude that Aeon manages to recognize the importance of relatively qualitative consumers and social benefits as well as the quantitative measures of sales, revenue, and profit. And this can increase the confident of investors to invest in.

E. Two Additional Information that will Further Enhance Our Proposal/Opinion/Suggestion to Our ClientAccording to the Aeon annual report 2013, we found additional information that can further enhance our proposal choice which is Groups risk management and internal control system of Aeon group. It had constructed a clearly defined authority level to all the positions that are held by the entire workers. Any expenses or operation are monitored by Groups business operation department by using advance IT technologies and the group defined as The Audit and Risk Management Committee (ARMC).A risk management committee is established as a company-wide risk management body, placed as a sub-organization of the management conference, to control business risks related to disaster, environment and compliance. The committee identifies all possible company-wide risks, monitors risk management operation, exchanges information, constantly reviews the risk management systems, and at the same time formulates risk management policies. The policies are then used to produce specific rules and guidelines at each risk management supervising division and conduct periodic reviews. All these details are thoroughly notified to all employees through education and training programmes as well as an electronic bulletin board system. Upon the occurrence of any danger of imminent and serious loss, appropriate information distribution and decision making are performed based on the "Rules for Control of Management Danger", followed by measures to control or minimize the damage. Due to Aeon has good risk management, the investor can be trustingly to invest in this company. Decision made by the directors is recorded and managed in an appropriate manner by the executive director of each department in Aeon, who is responsible for producing documents such as written approval and meeting minutes in line with company regulations. A board of directors meeting in Aeon is held monthly and whenever it is necessary. Critical issues requiring decision making by the president or higher, which may contain a risk affecting the company, are discussed from various perspectives in a management conference serving as the president's advisory body which consists of managing directors and full-time corporate auditors as the core members and the final decision is made by the president or resolution by the board of directors.Besides, the superior goodwill of Aeon cannot be denied by everyone. Aeon is in the top 25 global retailers list, this shows that the brand value of Aeon is the most valuable among these three companies. It is Japan's second largest retail company, operates supermarkets, convenience stores, malls and a stable of specialty shops (Retrieved from http://www.licensemag.com/license-global). Due to the exceptional management, fully trained and skilled employees situate Aeon in a desirable state. In addition, a well-known brand name business is easier to operate for the next 10 or 15 year based on the good customers relation and good contact with suppliers. These will help Aeon to reduce a lot of problems and allow it to focus more in its managements (Investopedia, n.d.).

F. Limitations of the Analysis The first limitation is the financial statement will mislead the user (Accounting-Management, n.d.). All the accuracy of financial information totally lays on how accurately the financial statement had been prepared. If there are some mistakes made by the accountant who provides the financial statement, the users will believe that the information written is totally true although it is not. It causes users misunderstanding and eventually results in wrong decisions and actions taken by the users.

Besides, another limitation is not really satisfaction for future planning. Due to the figures used in the financial statement are historical data, users cannot fully utilize them for planning any future projects or investment just for prevent any loss or make any important decision. These limitation of analysis will affect quite lot of investors and also affect the company that listed in stock markets (Accounting-Management, n.d.).

Furthermore, the qualitative aspect is also one of the limitations of analysis of proposal. Commonly the financial statement only show in quantitative information about the companys financial condition, but there are quite lot of information are fails to provide in quantitative forms. For examples, management labor relation, customers feedback and the management skills of board of directors (Accounting-Management, n.d.).

Other than that, Wahid, M., 2013, said that wrong judgments will occur due to the skills used by the analyst without capable knowledge and it will lead to wrong direction. As a result, will face the problem on losing investment funds or be a victim in stock market.

Finally, users will make comparison with not possible and not accurate data or statements. All those company financial statements are based on the historical data that collected. Therefore making a comparison between different year are not possible due to inflation distorts, different of economics condition and also the policy of government. As a results, we totally cant make an accurate comparison by using the financial statements that given by companies (Michael, C. & Steven, K., 2001). EMBED Excel.Chart.8 \s

Bar chart 2.1 Net profit margin

EMBED Excel.Chart.8 \s

Bar chart 2.2 Operating profit margin


Bar chart 2.3 Return on Asset


Bar chart 2.4 Return on Equity


Bar chart 2.5 Current ratio


Bar chart 2.6 Acid Test Ratio

Picture 1.2 The Store Launching Ceremony on Sept 2014

Picture 1.1

Present at the cheque presentation were AEON Credit (M) Bhd executive director Kenji Fujita, AEON Big (M) Sdn Bhd director Mitsuru Nakata, theSun managing editor Freddie Ng and Mercy Malaysia executive director Ahmad Faezal Mohamed.


Bar chart 2.7 Dividend paid by three companies

22

_1477329562.xlsChart1

7.937.65

8.595.08

1.151.85

Year 2012

Year 2013

Return On Asset (%)

7.93

Sheet1

Year 2012Year 2013

Aeon Co. (M) Bhd7.937.65



To resize chart data range, drag lower right corner of range.

_1477333365.xlsChart1

78.5767.14

185.69185.89

109.1126.16

Year 2012

Year 2013

Current Ratio (x)

Sheet1

Year 2012Year 2013

Aeon Co. (M) Bhd78.5767.14




_1477343159.xlsChart1

11.9812.32

62.2841.95

2.172.54

Year 2012

Year 2013

Operating Profit Margin (%)

Sheet1

Year 2012Year 2013

Aeon Co. (M) Bhd11.9812.32




_1477385509.xlsChart1

17.2522

1618

3.753.75

Year 2012

Year 2013

Dividends paid (sen)

Sheet1

Year 2012Year 2013

Aeon Co. (M) Bhd17.2522

Parkson Holdings Bhd1618



_1477329708.xlsChart1

14.4914.05

15.859.91

3.034.64

Year 2012

Year 2013

Return On Equity (%)

Sheet1

Year 2012Year 2013

Aeon Co. (M) Bhd14.4914.05




_1477333346.xlsChart1

47.3133.08

172.09172.9

49.7572.48

Year 2012

Year 2013

Acid Test Ratio (x)

Sheet1

Year 2012Year 2013

Aeon Co. (M) Bhd47.3133.08




_1477154474.xlsChart1

8.728.73

49.8431.9

0.71.11

Year 2012

Year 2013

Net Profit Margin (%)

Sheet1

Year 2012Year 2013

Aeon Co. (M) Bhd8.728.73




financial ratio and interpretation

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