Critical Assessment of Jjb Sports Plc Annual Reports and Accounts

Topics: Financial statements, Annual report, Corporate governance Pages: 7 (2052 words) Published: April 28, 2013
Critical Assessment of JJB Sports plc Annual Reports and Accounts

Table of Contents

Business Review4
Reliance on Annual Reports6


An annual report is a ‘portrait’ of the business. It embeds a sense of achievement, as well as, future prospects into the minds of the company, as well as, its readers (Sanders, 1949). JJB Sports plc is one of the foremost vendors of sports goods in UK. They have been facing a tough and challenging time over the years which are reflected in their annual report. Emphasis is mostly given on the way through which the company can complete a successful turnaround. The annual report begins with the description of the problems they are facing and promising a bright future for the company ahead.

Annual reports are the source of financial and non financial strategies and activities of the company over a year. They provide relevant information to relevant parties about the operations of the company and how well the company has performed over year, as well as, what are the new strategies being employed by the business (CPA Australia Ltd., 2012).

This report will critically analyze and assess the initial section of the annual reports and accounts of JJB Sports plc consisting of the Overview, Business review and Governance section of the annual report 2011. The annual report will be analyzed from an investor’s point of view, and information from the report will be used to gauge the performance and future prospects of investment in the organization. Critical assessment of the initial three sections of the annual report 2011 will be done followed by the extent of relevance of investment information in the annual report. Question 1: Overview

The overview begins with a brief statement by the Chairman, Mike McTighe who admits to the turmoil that the company is facing and then goes on to list the steps that the company has taken to correct the issues. The steps include raising capital for the firm, restructuring the business plan which includes expanding the existing portfolio of the company without taking significant risks. The business plan is in general a turnaround plan which will reinstate the company as the leading retailers of sports goods just like the way they were before the problems ensued. The achievements of the company are listed, most important of them being able to reduce costs which are likely to generate more profits for the firm in the future. The chairman statement continues with acknowledgement to the board members who have been pivotal to the turnaround process followed by the acknowledgement to the employees. The one issue with the acknowledgement is that it is implied that the company has restructured their senior team which can be perceived as a negative and desperate step by many readers, most importantly investors who may doubt the credibility of the company if they come to know that the board is inefficient and needs constant replacement.

The Chief Executive’s review follows the Chairman’s statement. The CEO just like the director starts off with explaining that the company’s current situation may last a long time; however, steps are being taken to rectify all the past issues and the company is now revamping their structure and strategy to operate. The emphasis on a new senior team employed by the company is clear. The future prospects are mainly promises of a better tomorrow compared to today without establishing any solid fact that might suggest. Then, the CEO’s review goes on to explain the losses that the company had to face over the year. The reasons for the loss are mainly the lack of performance by procurement, as well as, availability of cash for stocking purposes. The company did recently expand into the online version of their store, which is a positive step towards achieving their targets and had doubled their earnings from the online front compared to the last...

References: Back, B., Toivonen, J., Vanharanta, H. and Visa, A. (2001). Comparing Numerical Data and Text Information from Annual Reports using Self-organizing Maps. International Journal of Accounting Information Systems, 2, 249-269.
Beattie, V., McInnes, B. and Fearnley, S. (2004). A Method for Analyzing and Evaluating Narratives in Annual Reports: A Comprehensive Descriptive Profile Metrics for Disclosure Quality Attributes. Accounting Forum, 28(3), 205-236.
Bloomfield, R. (2008). Discussion of 'Annual Report Readability, Current Earnings, and Earnings Persistence. Journal of Accounting and Economics, 45(2-3), 248-252.
CPA Australia Ltd. (2012). A Guide to Understanding Annual Reports: Listed Companies.
JJB Sports PLC (2011)
Li, F. (2008). Annual Report Readability, Current Earnings, and Earnings Persistence. Journal of Accounting and Economics, 45, 221-247.
Means, T.L. (1981). Readability: An Evaluation Criterion of Stockholder Reaction to Annual Reports. The Journal of Business Communication, 24, 19-27.
Sanders, T.H. (1949). The Annual Report Portrait of a Business. Harvard Business Review, 27(1), .
Schleicher, T., Hussainey, K. and Walker, M. (2007). Loss Firms ' Annual Report Narratives and Share Price Anticipation of Earnings. The British Accounting Review, 32(9), 153-171.
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Critical assessment of annual report of Wm Morrison Supermarkets Plc Essay
  • HMV Group PLC Annual Report and Accounts 2010 Research Paper
  • The Annual Report Research Paper
  • Annual Report Essay
  • Majestic Wine PLC Annual Report & Accounts Essay
  • Annual Report of Hero Motocorp Essay
  • Essay on chilime annual report 2011
  • Account Essay

Become a StudyMode Member

Sign Up - It's Free
Hanasaku Iroha | Retro di un segnalibro | Dragon Ball Super Episode 67 English Sub