Stay in the Sky Airlines – Refer to the scenario information in question 7
Prioritise the issues in column one, by ranking them from 1 to 5 (with one being the most urgent and 5 the less urgent).
|Problem||Prioritise (1 to 5)|
|Stay in the Sky Airlines reported a Statutory Loss of ($315 million) for 30th June 2019, over the previous six years it has reported losses totalling $1.610 Billion. Pressure from the Board of Directors and Shareholders want the Group back in profit within 2 years.|
|After reviewing the break-even point of air transport, you determined over 60% of the airline’s routes are unprofitable, these routes need to be reviewed.|
|Fuel Costs have been affected by the US$ exchange rates – 2019 $1.145 Billion up from $986 Million in 2019. Plans are in hand to update the fleet in 2024 may need to be brought forward.|
|Employee numbers in 2019 are approximately 10,000, this will be cut by 750 by combining Stay in the Sky Domestic with Stay in the Sky International into one administration office, this had been announced to happen in 2022, it may need to be brought forward.|
|The Board of Directors urgently want you to prepare separate Cash Flow budgets, Profit & Loss Accounts and Balance Sheets for each entity and the consolidated accounts.|