07 Identify and explain two ways NBV’s managers could use its financial accounts to help make decisions. [4]

[BASEL Moderator]

NBV is a multinational company. It makes building products such as bricks. Last year NBV’s financial accounts showed capital employed as $144 billion. NBV has operations in 18 countries and a total 4 workforce of 400000. NBV experiences some diseconomies of scale. All raw materials are purchased from the countries it operates in to avoid problems with exchange rates. NBV plans to open a factory in Country B for the first time.

07 Identify and explain two ways NBV’s managers could use its financial accounts to help make decisions. [4]

Possible KN Points:
• Help measure financial OR profit over time
• Help compare its performance with its competitors
• Help decide which source of finance to use OR whether to borrow money or able to afford to borrow
• Help make investment decisions
• Decide how much dividend to pay