topic report on cholimex company

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<b>Group Assignment [ACC101]</b>

<b>TOPIC: Report on Cholimex company</b>

<b> Name of group member Contribution (%) </b>

<b>Can Tho, November 2023</b>

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<small>Group Assignment [ACC101]... 1</small>

<small>PART A: GENERAL INFORMATION... 4</small>

<small>1.Briefly describe the background information of the company? (History, main brands, missions and objectives, main business activities, strategic planning…)...4</small>

<small>2.Describe the position and market share of the company in the market. Find its direct competitors?....4</small>

<small>3.Describe shareholders structure and important shareholders of the chosen company?...4</small>

<small>4... 4</small>

<small>PART B: FINANCIAL DATA... 5</small>

<small>4.Analyze in detail the changes of financial statements: Income statement; Balance sheet; Statement ofcash flow; Notes for financial statement?...5</small>

<small>5.What types of activities bring in the most revenue and profits for the company?...6</small>

<small>6.Compare to the previous financial year, comment to the effectiveness of the chosen company in 2022?... 6</small>

<small>7.What are your recommendations for the accounting department of the company?...7</small>

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PART A: GENERAL INFORMATION

<b>1. Briefly describe the background information of the company? (History, main brands, missions and objectives, main business activities, strategic planning…)</b>

Cholimex Company is a leading food company in Vietnam. Below is basic informationabout the company:

<b>- History: Cholimex was founded in 1983 in Vietnam and is one of the oldest and</b>

most reputable food companies in the industry.

<b>- Main brand: Cholimex is famous for fish sauce, chili sauce and many other food</b>

products, especially spices and sauces.

<b>- Mission and goals: Cholimex's mission is to provide high quality food products to</b>

consumers, ensuring safety and deliciousness. The company's goal may be to expand itsmarket and maintain a strong brand.

<b>- Main business activities: Cholimex mainly operates in the field of manufacturing</b>

and distributing food products, especially spices, fish sauce, chili sauce and sauces.

<b>- Strategy: Cholimex's strategy may include expanding production lines, improving</b>

product quality, and seeking export opportunities to international markets.

<b>2. Describe the position and market share of the company in the market. Find its direct competitors?</b>

<b>Position and market share in the market: Cholimex has a strong position in the field</b>

of seasoning and fish sauce products in Vietnam. This brand has a large market share inthe spice food market and is one of the top choices of consumers. Cholimex competesdirectly with competitors in the food industry such as Masan, Ajinomoto, and otherseasoning and fish sauce manufacturers.

<b>3. Describe shareholders structure and important shareholders of the chosen company?4.</b>

<b>Shareholder structure and important shareholders: Cholimex Food has 3 major</b>

shareholders holding up to 91% of the company's capital, including Cho Lon Investmentand Import-Export Joint Stock Company, which owns more than 40% of the capital, and alimited liability company. Masan Food MTV owns more than 32% of the capital andNichirei Foods Inc owns 19%.

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PART B: FINANCIAL DATA

<b>4. Analyze in detail the changes of financial statements: Income statement; Balance sheet; Statement of cash flow; Notes for financial statement?</b>

6 Net operating profit 228,637,648,848 275,014,584,200

8 Net profit after tax 185,987,374,828 221,652,191,923

10 Net cash flows from operatingactivities

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14 Current ratio 1.77 1.76

<b>5. What types of activities bring in the most revenue and profits for the company?</b>

Financial activities bring the largest revenue and profit to the company. The word staticcash flow from financial activities reflects the static amount of cash that the companyreceives from main financial activities such as borrowing, repaying debt, issuing shares,or paying dividends. In Cholimex's static cash flow report, we can find that cash flowfrom main financial activities increased from the previous year. In the previous year,when it started, the amount of money was 104,037,276,936 and by the end it hadincreased to 167,675,646,977. And in the current year, the amount of money hasincreased to 186,139,053,529, it can be seen that the amount of money has increased to18,463,406,552 compared to the previous year. Therefore, financial activities are theactivities that bring the largest revenue and profit to Cholimex.

<b>6. Compare to the previous financial year, comment to the effectiveness of the chosen company in 2022?</b>

The revenue of Cholimex company in 2022 was 1,726,592 million VND, an increase of9.4% compared to 2021. The revenue of Masan company in 2022 was 76,200 billionVND, an increase of 2.6% compared to 2021. Thus, Cholimex company had a highergrowth rate of revenue than Masan company.

The net profit after tax of Cholimex company in 2022 was 140,000 million VND, anincrease of 16.7% compared to 2021. The net profit after tax of Masan company in 2022was 3,500 billion VND, a decrease of 15.7% compared to 2021. Thus, Cholimexcompany had a higher growth rate of net profit after tax and did not suffer a decline likeMasan company.

The gross profit margin on revenue of Cholimex company in 2022 was 30.3%, slightlylower than 2021 which was 30.6%. The gross profit margin on revenue of Masancompany in 2022 was 32.6%, sharply lower than 2021 which was 38.4%. Thus,Cholimex company had a more stable gross profit margin on revenue and did not droptoo much like Masan company.

The net profit margin on revenue of Cholimex company in 2022 was 8.1%, higher than2021 which was 7.7%. The net profit margin on revenue of Masan company in 2022 was4.6%, lower than 2021 which was 5.9%. Thus, Cholimex company had a higher netprofit

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margin on revenue and had an upward trend, while Masan company had a lower netprofit margin on revenue and had a downward trend.

From these indicators, it can be seen that Cholimex company performed better in 2022than Masan company. Cholimex company maintained the growth of revenue and netprofit after tax, as well as improved the net profit margin on revenue. Masan companyfaced difficulties in maintaining revenue and net profit after tax, as well as reduced thegross profit margin and net profit margin on revenue. This is a positive result forCholimex company in the context of the food market becoming more competitive anddemanding innovation and quality.

<b>7. What are your recommendations for the accounting department of the company?</b>

Based on the financial report of Cholimex Food Company in 2022, the company's netrevenue reached 1,372 billion VND, an increase of 10% compared to 2021. The mainreason is because the company has expanded its export market to other countries, such asJapan, Korea, China, and the United States, as well as developing new products such aschar siu dumplings and Vietnamese-flavored soy sauce.

The company's profit after tax reached 112 billion VND, an increase of 17% compared to2021. Thanks to the company improving business efficiency, reducing production andmanagement costs, and increasing the gross profit ratio on sales revenue from 29% to31%.

The company's debt-to-total assets ratio is 22%, down 3% compared to 2021. This showsthat the company has reduced financial risks by paying off part of its short-term andlong-term debt.

The company's return on equity (ROE) is 15%, higher than the industry average. Thisshows that the company is able to effectively use shareholder capital to generate profits.From the statistical data from the accounting department, we can also see that thecompany's business situation has made remarkable progress. To develop further, theaccounting department should strengthen forecasting, continue to improve financialmanagement capacity, and ensure the company's finances are safe and resources are usedeffectively.

Review and improve the company's internal control systems and processes to help ensurethe accuracy and reliability of financial information while minimizing the risk of fraudand error. Optimize accounting and financial reporting processes, apply the most modernand advanced tools and software, improve the quality and transparency of financialinformation, and save time in the accounting process. Consider raising capital fromdifferent sources, not just relying on debt, to reduce financial costs and increase liquidity.The accounting department needs to proactively update and comply with legalregulations related to accounting, tax, and finance to avoid legal risks.

In addition, Cholimex's accounting department all has university degrees, especially thechief accountant, Ms. Nguyen Thi Bich Ngoc, who has a bachelor's degree in economicsand general accounting. However, to improve the professionalism of the accountingdepartment, the company can organize training sessions and training on accounting

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issues. This will provide opportunities for employees to learn and update theirprofessional knowledge while improving their ability to understand and apply thelatest accounting regulations.

Training sessions may focus on areas such as management accounting, tax accounting,or international accounting standards. At the same time, companies can also encourageemployees to participate in extracurricular courses or specialized certificates toimprove their personal qualifications and skills.

<b>8. NOTE</b>

Debt Ratio

Total LiabilitiesTotal Assets ⁼

492,459,438,2421 , 161 ,803 752, , 67¿0.42387489

Total LiabilitiesTotal Assets ⁼

600,329,028,3461 , 429 592 165, , , 96¿0.419930273

Current Ratio

Current AssetsCurrent Liabilities⁼

863 962 937, , ,04486,314,312,492¿1.77655256

Current AssetsCurrent Liabilities⁼

Equity ratio

TotalequityTotal assets⁼

TotalequityTotal assets⁼

Return on assets

Net IncomeAverage total asset

(1,161,803,752,679 1,011,344,676,422 2+ )/¿0.1711685639 %

Net IncomeAverage totalasset

(1,161,803,752,679 1,429,592,165,965 2+ )/¿0.1710677943 %

Profit margin

Net IncomeNet Sales ⁼

185,987,374,8282,508,601,055,214¿0.074139877 %

Net IncomeNet Sales ⁼

221,652,191,9233 , 219 , 039 ,254 , 44¿0.068856629 %

(Average total assets is computed by adding the beginning and ending amounts for that <small>8</small>

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same period and dividing by 2)

<small>20212022</small>

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<small>12</small>

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December 2022 [PDF]. Deloitte Vietnam Company Limited.Cholimex Food Joint Stock Company. (n.d.). History.Cholimex Food Joint Stock Company. (n.d.). Vision and mission.

Nguyen, T. (2021, April 5). Strategy helps Cholimex Food meet market demand. VnExpress.Nguyen, H. (2021, March 18). Cholimex Food pays 50% cash dividend. Bao Dau Tu.Masan Group. (2023). Financial information.

Cholimex Food. (2022). Audited financial statements 2021.

<small>14</small>

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