As chief accountant of Curtis you are required to write a report to Essay

As chief accountant of Curtis you are required to write a report to the Chairman - Essay Example A Comparison of financial year 2012 with the financial year of 2011 presents that fact that the volume of sales in the retail industry in UK increased by 2.7 percent. Changes in reported retail sales between August 2011 and August 2012 standard reporting periods (by size of business)       Pre-dominantly food Non-specialized pre-dominantly non-food Textile, clothing and footwear House-hold goods Other non-food Non-store retailing Pre-dominantly automotive fuel Total All Retailing including automotive fuel                               increase 107 32 138 72 375 64 23 811 All decrease 97 33 104 77 306 46 50 713    total 204 65 242 149 681 110 73 1524                               Large increase 66 32 110 42 158 30 n.a. 438 decrease 56 33 73 47 107 19 n.a. 335    total 122 65 183 89 265 49 n.a. 773 Small increase 41 n.a. 28 30 217 34 23 373 and decrease 41 n.a. 31 30 199 27 50 378 medium total 82 n.a. 59 60 416 61 73 751 [Ons.gov.uk (1999 ) Retail Sales: August, 2012] With respect to the food merchandise business, there were certain hardships that were faced by the retailer. During the year 2012, costs of both food items and fuel increased, particularly of fuel which resulted in an escalation in the manufacturing cost of the merchandise. Tate & Lyle Plc has in place an import team which constantly monitors the fluctuation in prices of cotton. For the purpose of reducing the cost of fuel, the retailers are now acquiring the help from the appropriate technology to manage the distribution in the most cost effective manner. In addition to that, retailers are now opting annual fixed price contracts. It is considered that the food industry is comparatively remaining consistent. However, it the prevailing market condition especially the low demand of food ingredient in EU countries significantly influence the market and brought the fluctuation the food market. The deterioration in macroeconomic environment as the result of existing financial crisis also negatively affects this sector. Additionally, the market is passing through from the bad time because the consumer and government are more focusing on the healthy lifestyle. A lot of advertisement is doing on the published media, social media to create awareness among consumers to adopt the healthy life style. The second main reason of downward trend of the food market is increase in the sugar prices and other various raw materials. The increase in the input material results in the high price of the end food products. The consumers are price conscious. The purchasing power of the consumer has been tightening due to low income. (b) As the companies being evaluated are situated in Hong Kong, the primary risk that the acquisition of any of these companies entails is that of the currency risk. Curtis Plc needs to have an adequate understanding of what these risks here and how they can be mitigated. The global operations of any multinational require it to a ctively participate in international trade which causes it to be exposed to a great deal of foreign exchange risks. These companies engages in international trade through foreign exchange forward contracts and options and cross currency swaps to hedge various currency exposures. These exposures primarily include assets, liabilities and bonds denominated in foreign currency. Effective financial management requires identification of