7. Exercise Review and Exam Preparation. Industrial Engineering and Management 1

Transcription

1 7. Exercise Review and Exam Preparation Industrial Engineering and Management 1

2 Today s Agenda Instructions on finalizing the report Calculations in the Exam Revision of typical calculations Other Questions in the Exam

3 Today s Agenda Instructions on finalizing the report Calculations in the Exam Revision of typical calculations Other Questions in the Exam

4 Finalizing the Report The DL for the final report: at 4 pm! Submissions to MyCourses. Late submissions will be deducted two points per beginning day! Finalize your work. The part assignments should form a coherent entity. Use the feedback you have received. 11/17/2016 4

5 Finalizing the Report The report has 6 distinct sections (based on the weekly part assignments), which must be found in the report Include your own analysis, conclusions and recommendations Also, pay attention to referencres, graphes and figures as well as finalizing Use appendices! You should add e.g. The project network and the excel template as an appendix, to which you can reference to in your report You may use the model template from MyCourses in your word document. If you have used, for example Google Drive, it is recommended that you would finalize your report with Microsoft Word to get a better outlook. Return only one pdf-document with the Excel-model as an appendix! 11/17/2016 5

6 Grading Grading Criteria Innovation, creativity (different things!) Being systematic Substance the quality of the analytical content Substance the quality of the academic content Weighting Innovation: 20% - The originality of the offering/concept, practicality, finding a suitable market niche The report: 20% - Referencing, structure, appearance, use of figures & graphsm references to figures and tables, structure, polishing Substance quality of content: 60%

7 Grading The final report is analysed, maximum points: 20 From weekly submissions you can earn 0p/0,5p/1p, total. max 6 points Total maximum is thus 26 points 12 points required to pass

8 What else? Pass the exam, e.g or ! 50 % of points needed. Give course feedback (you get an extra point!) when the feedback is open. Everyone will get a personal link to the course feedback by . 11/17/2016 8

9 Today s Agenda Instructions on finalizing the report Calculations in the Exam Revision of typical calculations Other Questions in the Exam

10 Calculations The first part of the exam is based on given material. The questions are similar to the STACK-exercises by structure and area Weighting is 30% of the exam The given material includes information on the starting point as well as a list of formulas The purpose of the question is to assess a student s understanding on a company s financial situation The structure of the calculation questions is different from last year! 11/17/

11 The structure of a calculation question these are things you need to understand well Initial data: some or all of these Based on the initial data and given formulas you need to calculate some of these: Explanation on the operations of the financial year The expected consequences of a investment/divestme nt for the business Income Statement Balance Sheet Material Flows The cost structure of a product Opening and/or ending balance sheet Explanation on the future operations Liquidity Investment calculation Cash Flow calculation

12 Today s Agenda Instructions on finalizing the report Calculations in the Exam Revision of typical calculations Other Questions in the Exam

13 Continuous Liquidity? Year 1 Year 2 Year n Liquidity shall be maintained always! Financial assets in the beginning Incoming payments Outgoing payments Financial assets in the end

14 Working Capital + - Result of? Differences in time frames of material flows and cash flows Why is it important? Working Capital and Fixed Assets determine the company s need for financing Creates balance sheet items Is not a single balance sheet item but consists of multiple items

15 Balance Sheet Equations: ATOT i = DTOT i + ETOT i A = assets D = Debt E = Equity Always TRUE! Change in assets results always in an equal change in equity/debt

16 Assets and Owners The assets of the company are owned by shareholders and debt holders For example: The debt of the company is backed by its assets. On the other hand, the bank is liable to its clients for their deposits

17 Balance Sheet In the financial statement the balance sheet items are presented as subtotals Total Assets The following fiscal year?

18 Fixed Assets in the balance sheet: Deferred charge and Depreciation When investing in fixed assets, assets change from financial assets into fixed assets = deferred charge Outgoing payment Depreciating fixed assets

19 Income Statement REVENUE ,00+ -Cost of goods sold ,00- GROSS MARGIN ,00+ -Other operating expens ,00- EBITDA ,00+ - Depreciation ,00- OPERATING INCOME(EBIT) ,00+ - Interest ,00- EBT ,00+ - Taxes ,00- Profit for the fiscal yr ,00+ Accrual based Begins with revenues Includes all expenses of the fiscal year Presents different intermediate results Ends with the profit for the fiscal year, i.e. Explains what the net income consists of!

20 Cash Flow Statements for a start-up INVENTORIES, year end ,00+ + ACCOUNTS RECEIVABLE, year end ,00+ - ACCOUNTS PAYABLES, year end ,00- WORKING CAPITAL, Total, year end , EBITDA ,00+ + WORKING CAPITAL, beginning yr 0,00+ - WORKING CAPITAKm year end ,00- - INTEREST ,00- - TAXES ,00- CASH FLOW FROM OPERATIONS(CFOPS i ) , FIXED ASSETS, beginning of ye 0,00+ - DEPRECIATION ,00- - FIXED ASSETS, year end ,00- CASH FLOW FROM INVESTMENTS(CFINV i ) , SHAREHOLDER S CAPITAL, year end ,00+ - SHAREHOLDER S CAPITAL, beginning of yr 0,00- - DIVIDEND 0,00- + LOANS OUTSTANDING, year end ,00+ - LOANS OUTSTANDING, beginning of yr 0,00- CASH FLOW FROM FINANCING(CFFIN i) , You can check the net change in financial assets during the fiscal year, as follows: CASH AND EQUIVALENTS, year end ,00+ - CASH AND EQUIVALENTS, beginning yr 0,00- Change in Cash and Equiva.( ACash i ) , Check : CFOPS i + CFINV i + CFFIN i = ARCash i , , ,00= ,00 => OK

21 Cost-Profit-Volume Analysis In a certain time perspective

22 Free Cash Flow (FCF) Describes a situation, where cash = 0 always Financing structure does not matter!

23 Calculating the FCF Investments are booked when paid Accrual-based EBITDA needs to be adjusted with the change in working capital

24 The effect of corporate taxes Corporates are taxed by accrual basis Companies need to pay taxes also for accrual based income, even if the cash flow would be

25 Today s Agenda Instructions on finalizing the report Calculations in the Exam Revision of typical calculations Other Questions in the Exam

26 Definitions There are typically six terms or concepts to define Weighting about 30% of the exam Definitions are short and concise an example is not a definition The purpose of the questions is to test the understanding of relevant vocabulary 11/17/

27 How to define a concept? Keep it short(max 3 sentences) An example is not enough, and does not add value to the answer Keep to the point, there is no need to cover the topic extensively The course material and Aalto-wiki have good glossaries with a lot of the terms 11/17/

28 Example Question A fishbone diagram a.k.a Ishikawa-diagram Production 11/17/

29 Model answer A fishbone diagram, a.k.a. Ishikawa-diagram A fishbone diagram is a tool used in quality control to aid problem solving (0.5p). The causes and effects are grouped into a diagram similar to a fishbone (1p). Production Production is the manufacturing of products for sale (0.5p). Materials are transformed into goods (0.5p) that can be physical products or services (0.5p). 11/17/

30 Short Answer Questions There are normally three SAQs in the exam Weighting about 20% of the exam SAQ answers should be at least twice the length of the definitions in the previous section The purpose is to test the understanding of key concepts 11/17/

31 How to Answer a SAQ? Define the concept appearing in the question Answer the (possible) further question and remember to explain your reasoning Give an example Answer in full sentences and explain each part. Bullet points will not do. 11/17/

32 Example SAQ What are the main tasks of a project manager? 11/17/

33 Example SAQ model answer What are the main tasks of a project manager? The project manager is the person responsible for a project, achieving its goals and managing its implementation (1p).The project manager protects the project organization from external disruptions and ensures a peaceful working environment that supports the achievement of the goals (1p). The manager is also responsible for coordinating the communication between stakeholders and the project (1p). 11/17/

34 Essay Questions There is typivally one essay question Wughting about 20% of the exam There are often a few choices of topics The question allows candidates to show a deeper understanding of Industrial Engineering and Management related topics, and to apply theories behind them 11/17/

35 How to answer to an essay? Define the term/concept relevant(see definitons) Answer the question clearly, including all sub-questions Structure your answer and use paragraphs, in which you bring new information to your answer (no redundant paragraphs!) Ensure that your answer forms a strong entity and avoid listing things. Keep your answer concise. Keep to the point 11/17/

36 Example Essay Question Mikko Jääskeläinen covered the business model during his lecture. Come up with a business idea (other than a restaurant or bookstore) and describe it briefly. Go through your idea by its different areas and describe how you would organize each one to make the business as successful as possible. NOTE: Do not use a bookstore or restaurant, any other idea will do. 11/17/

37 Model Answer First, the business idea is introduced. In addition, it is explained what (the offering) is sold to whom (the customers) with examples. The customer relations can be considered here. The products and production (what and how) can be covered, as well as what resources and costs these will include. Finally, in the end of the answer, you can write a short conclusion of your business idea by considering how the company creates value to its shareholders. 11/17/

38 Read through each question one more time before returning the exam and make sure you have answered to exactly what was asked! 11/17/

39 Thank You! Good Luck for the exam!