Briefly explain the general purpose of each of the three financial statements (the income statement, the balance sheet and the cash flow statement) and the usefulness of each of them for Improve Ltd. (20 marks)

Analyse the financial statements that have been prepared by Improve Ltd. In particular, comment on the following aspects of the company: (55 marks in total)
Areas of concern in financial performance, focussing mainly on information from the income statement. (22 marks)

Areas of concern in financial health, focussing mainly on ratios dependent on the income statement and the balance sheet. (23 marks)

Areas of concern in cash flow management, focussing mainly on information available from the cash flow statement. (10 marks)

Using the analysis in your answer to question 2, assess the validity of the concerns raised by Uncle Dave in relation to the business. What practical steps should Susan and Chris now undertake in order to improve the financial performance and financial health of the business? (15 marks