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Cases

Ohjelma
Bike Lease Finland

Bike Lease Finland

Leasing and maintenance of employee bicycles, digital services.

Ohjelma
Excelence Solutions

Excelence Solutions

Consulting and data analytics, expert services and consulting.

Ohjelma
Finnish Timber Oy

Finnish Timber Oy

Ecological log buildings and construction site processes, project business.

Ohjelma
Green Scape

Green Scape

Customized green wall services for B2B clients, service business.

Ohjelma
Marine Craft

Marine Craft

Customized motorboats, project delivery, manufacturing industry.

Ohjelma
Scandinavian Design

Scandinavian Design

Leasing and maintenance of company bicycles, digital services.

Task

Selection of Key Financial Ratios



In this task, the student selects five key financial ratios for a case company, such as revenue, margin, cash flow, or customer acquisition cost. They briefly describe what each ratio means, where the data is obtained from, and why these specific figures are important for the company to monitor. Additionally, the student considers the frequency of monitoring, responsible persons, and compiles a short "quick guide" on the selected ratios. The task helps to understand how financial ratios support the company's everyday decision-making and guidance.

Learning objectives

After completing the task, the student:
1. Can select suitable financial ratios for the case company's situation.
2. Understands the basic principles of how key ratios are calculated and where the information is practically obtained.
3. Can justify why certain ratios are important for management to monitor.
4. Can consider the frequency of monitoring the ratios and responsibility in practical business operations.

Step by step

  1. Selection of key figures

    Objective:
    The objective of the assignment is that the student is able to select key financial indicators for the case company and justify why these specific indicators are important to monitor. The aim is also to understand how the indicators relate to the company’s goals and everyday decision-making.

    Materials:

    • The selected case company description from the learning material.

    • The assignment is based on the case description and the moderate, logical assumptions made about the company’s business structure and objectives.

    Assignment steps (instructions for the student):

    1. Briefly describe the case company’s financial situation and objectives
      Write 5–8 sentences about the type of business the case company operates, where its revenue mainly comes from and what kinds of growth or profitability goals it appears to have based on the case description.
      You may make well-grounded assumptions about, for example, the company’s size (micro, SME, larger) and how evenly revenue is generated throughout the year.

    2. Select five (5) key financial indicators
      Select a total of five indicators that you believe the case company should monitor regularly. You may choose, for example:

      • revenue

      • EBITDA or gross margin

      • cash flow or cash reserves

      • customer acquisition cost

      • contribution margin of an individual product/service

      • equity ratio, debt ratio, etc.
        Write briefly for each indicator what it measures (2–3 sentences).

    3. Define how the indicators are calculated and where the data comes from
      For each of the five indicators, describe:

      • which accounting or reporting information the indicator is calculated from (e.g. sales, purchases, salaries, loans)

      • the calculation method briefly in words (no need for numbers, a description at the “sales revenue – variable costs” level is sufficient)

      • from which system or report the information would be practically retrieved (e.g. financial management system, POS system).

    4. Justify why you chose these indicators
      Write about half a page answering the following questions:

      • what the company’s management or owner can more easily deduce based on these indicators

      • how the indicators relate to the case company’s objectives (e.g. growth, profitability, liquidity, risk management)

      • what might happen if the company did not monitor one of these indicators at all.

    5. Consider monitoring frequency and responsibilities
      Assess how often each indicator should be monitored (e.g. monthly, quarterly, annually) and who in the case company would be the most natural person to be responsible for the monitoring (e.g. the entrepreneur, financial officer, controller).
      Write briefly (about half a page) how practical reporting could work: in what form the indicators are presented and how often they are discussed.

    6. Summarise a “quick guide” of the five indicators for management
      Finally, prepare a concise 5–7 sentence summary that could be presented to the case company’s management. Explain:

      • which five indicators you selected

      • what the main message of each indicator is in one sentence

      • why these five together form an effective “control dashboard” for the case company.

    Submission and evaluation:
    Submit a text of about 1–2 pages showing:

    • a short description of the case company’s financial situation and objectives

    • the five selected indicators and their significance

    • a verbal description of how the indicators are calculated and where the data comes from

    • justifications for the choices, monitoring frequency and responsible persons

    • a concise summary of the set of five indicators.

    Evaluation focuses on how well you:

    • select indicators suitable for the case company’s situation

    • understand the content and practical significance of the indicators

    • base your choices on the company’s goals and decision-making needs

    • write clearly and logically without unnecessary technical jargon.

    Recommended working time: approximately 45–60 minutes, individually or in pairs.

Tasks by audience and theme

University of applied sciences

Polytechnics and higher education studies.

68 tasks