Bdev Case Study

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Contents
Introduction 2
Impairment review 3
Financial Instruments 5
POST - EMPLOYEMENT BENEFITS 8
CONCLUSION 10
References 11

Introduction
Barratt Development PLC is one of the largest House builders in the United Kingdom listed as ‘BDEV’ on the London Stock exchange operating under Housebuilding Industry forming part of FTSE 100 Index.
BDEV is in the business of buying land, designing, and construction of houses and consequently selling the residential property. It also undertakes commercial development projects. It operates its business mainly under three brands which are as follows:
• Barratt Homes
• David Wilson Homes
• Barratt London
BDEV is a holding Company with several subsidiaries, associates, and joint ventures, held
Management reviews on a regular basis and no indicators of delaying or not recording observed.
We have selected Berkeley Group Plc (BKG), which is in similar industry and size of BDEV. BKG has similar impairment policy as BDEV and has not reported any Impairment loss during the year 2016 and 2015 similar to BDEV (Berkeley Group Co. Plc, 2016). This is mainly due to favorable internal and external factors resulting in higher recoverable amount. Financial Instruments
BDEV has disclosed the financial instruments under respective categories of financial assets and liabilities. The financial assets comprise of Derivative financial instruments, Cash and cash equivalent, Trade receivables and Available for sale investments. Financial liabilities includes Derivative financial instruments, Bank overdrafts, loans, and borrowings. The below graph indicates a huge increase in financial liabilities representing 91% an increase in land payable bearing an interest on contract secured by a legal charge (Barratt Development Plc, 2016).

The Group is exposed to a various financial risk which mainly includes liquidity risk, market risk, credit risk and cash flow risk. BDEV manages these risk by maintaining

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