Business proposal “Airasia” Essay

The company selected for this line of descent proposal is line of descentAsia Berhad (hereafter referred as AirAsia) and two the business and fiscal performance of AirAsia would be polld from 1st January 2009 to 31st declination 2011. The company was incorporated in 2001, as a private especial(a) liability company both incorporated and domiciled in Malaysia. AirAsia was converted into a public limited liability company on 8th June 2004 and became listed on the Main Board of Bursa Malaysia Securities Berhad on 22 November 2004. The principal activity of AirAsia is providing Air Transportation Services. The vision of AirAsia has been to be the largest low cost flight path in Asia and serving the 3 billion people who are presently underserved with poor connectivity and high fares.AirAsias mission is to create a glob all(prenominal)y recognized brand in the ASEAN (Association of Southeast Asian Nations) and sustain lucrativeness emergence with the highest quality services and t echnological advancements. The philosophy of AirAsia is to make short possible for everyvirtuoso. Since 2001, AirAsia had swiftly broken travel norms across the globe, where it is a leash inexpensive carrier that does not need further introduction in ASEAN. With the tagline Now everyone can fly, AirAsia ferried 135 million guests as at 31 December 2011. Furthermore during the past ten AirAsia established made ventures with Thai AirAsia, Indonesia AirAsia, AirAsia Philippines, AirAsia Japan and AirAsia X (primarily foc employ on long-haul segment), allowing AirAsia to take low-cost flying to a further level with a route network that spans over 20 countries.Reasons for doing this business proposal Prior knowledgeThe of import reason for selecting this topic is to apply prior knowledge obtained from the business and financial modules previously covered in the ACCA syllabus. Moreover, financial analysis is crucial in interpreting results disclosed in the financial statements. Ava ilability of information in like manner availability of annual reports and other business sources provided me with adequate information to analyse the performance of AirAsia that further encouraged in choosing this topic. The annual reports were readily unattached from the company website and no time was wasted on extraction of it. Reasonsfor choosing AirAsiaExtensive growth of AirAsiaIn January 2002, AirAsia had only two airplanes that had been flying to six destinations within Malaysia. During the past decade AirAsia had significantly expanded to fly over 80 destinations with a pass along of 97 aircrafts as at 31 December 2011. Hence I was motivated to find out how AirAsia bring offd to achieve successful growth and a healthy bottom line. Famous in South East Asia (SEA)AirAsia is one of the largest and most popular low cost airlines in SEA, which had facilitated travelling at affordable prices which is the main reason behind passengers preferring AirAsia for both domestic and global flights. Moreover the destinations flown by AirAsia covers more hubs compared to other airlines and passengers are presented with bundled travel share options, which include air ticket, hotel accommodation, travel services. In addition, AirAsia was chosen as the balls stovepipe Low-Cost air passage awarded by Skytrax World Airline for four consecutive years (from year 2009 to 2012). Moreover, in the year 2009 and 2011, AirAsia was awarded with Best Asian Low-Cost Carrier award by TTG Travel Awards. roll objectives and search questionsProject objectives To analyse and evaluate the financial performance of AirAsia over a 3 year period by comparing its performance against tiger Airways Holdings Limited use relevant financial ratios. To analyse and evaluate the business performance of AirAsia over a 3 year period using the remaining three perspectives of the Balance Scorecard technique To assess, with reasons whether AirAsia is a worthy investment opportunity Research qu estionsHow did AirAsia financially perform in likeness with its competitor Tiger Airways?How does AirAsias financial performance impact on its shareholders? How was AirAsias business performance within the 3 years? How does AirAsia manage to sustain its no-frills strategy and position amidst the increasing competition? Sources of informationPrimary entropy sourcesPrimary data refers to new data collected by a investigator relating to the issues of the study. The methods used to collect primary data involve questionnaires, observations, surveys and interviews. The researcher who collects the data is referred as primary user(s). Primary data would not be used in this understand as it is time consuming to collect much(prenominal)(prenominal) data and respective information is readily functional. Therefore information availablefrom secondary sources will be used to meet the project objectives and research questions defined earlier. Secondary data sourcesSecondary data refers to d ata gathered by someone else and already used for their (primary users) purpose. The person undertaking the research is referred as the secondary user, who would undertake desk or library research for the said project. The main sources of secondary data used for project areTextbooksTextbooks were used as the main source of information as they were complied by people who dumbfound vast knowledge in the subject area and tend to be more reliable and accurate compared to other sources. The main types of textbooks referred in this project for financial analysis are ACCA BPP study materials and faculty member reference books such as Accounting Principles by Weygandt, Kimmel and Kieso and Financial and managerial accounting by Horngren, Harrison and Oliver. To analyse the companys business performance, Alignment using the equilibrate scorecard to create corporation synergies by Kaplan, Roberts and Norton had been referred to. Electronic sourcesE-sources were used out-of-pocket to conve nience and effectiveness. The main e-source used was AirAsias website to abstract the annual reports and all information regarding the company. Additionally, Internet had been used for further reading to enhance academic knowledge and obtain relevant newspaper articles and other information to the highest degree the company.