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Question 1

HLPaper 3

LuminaCare

Resource 1 – Company profile and financial context LuminaCare is a Ghana-based, for-profit social enterprise that manufactures solar-powered medical devices for rural clinics and maternal health centers across Sub-Saharan Africa. Its flagship product is a solar fetal heart monitor, which allows midwives to detect complications during pregnancy without relying on grid electricity. The company raised seed capital from impact investors but has now reached an inflection point: demand has grown by 300%, and LuminaCare must decide whether to pursue a $2.5M Series A equity round or take on $1.2M in concessional debt from a development bank.

Resource 2 – CFO’s internal memo (Finance)

“Our burn rate is steady, but we’ve reached our credit limit with suppliers. We operate on 90-day payment terms with clinics, so cash flow is always tight. Series A equity gives us the scale to meet demand and build a second facility—but would dilute founder control and introduce board-level oversight. The concessional loan is low-interest and non-dilutive but comes with covenants: quarterly EBITDA targets, strict capex limits, and donor-style reporting. Any miss could trigger loan restructuring or early repayment.”

Resource 3 – HR performance dashboard (Q1–Q2 2025)

Metric	Value
Staff turnover (last 6 months)	22%
Time to fill technical roles	49 days (↑ 24%)
% of roles with formal job descriptions	58%
Managerial span of control	Avg. 12 direct reports
Avg. team engagement score	67/100 (↓ from 78)
The head of HR notes that burnout and unclear career paths are leading to attrition, especially among product engineers and field deployment staff.

Resource 4 – Marketing team proposal

“Clinics love our mission—but most have no idea who we are until we show up at trade shows. We need to invest in inbound marketing, including a multilingual website, CRM tools, and a referral rewards program for midwives. More crucially, we’re perceived as a donor-funded nonprofit, not a serious tech company. To attract hospital procurement officers and larger buyers, we must reposition the brand to emphasize product quality, not just affordability and ethics.”

Resource 5 – Email thread: CEO to CFO and Marketing Lead

Resource 6 – Feedback from key field partners

“We rely on LuminaCare’s devices, but their response time for repairs has worsened.” “Sometimes we get different pricing from different reps. There’s no standard process.” “I love the mission—but our procurement officer wants a brand that feels serious. A logo change isn’t enough.”

1.

With reference to Resource 3, describe one HR issue that may be impacting LuminaCare’s ability to scale sustainably.

[2]

2.

Explain one financial challenge and one marketing challenge LuminaCare may face if it accepts the concessional loan.

[6]

3.

Using all the resources provided and your knowledge of business management tools and theories, recommend a possible plan of action for LuminaCare over the next five years.

[17]

Question 2

HLPaper 3

SolvoHealth

Resource 1 – Business model and service offering SolvoHealth is a rapidly growing mobile health company based in Vietnam. It operates a network of telehealth pods—solar-powered kiosks placed in rural communities that allow patients to consult doctors remotely, order basic diagnostics, and schedule medicine delivery. Each pod includes a screen, smart diagnostic tools, and a local “health navigator” who guides users. SolvoHealth employs: 40 health navigators (frontline staff) 15 remote doctors (contracted) 30 staff at its operations HQ in Ho Chi Minh City (marketing, product, supply chain, HR) SolvoHealth positions itself as affordable, hyper-local, and technology-enabled. The leadership team now plans to launch 60 pods in Indonesia and Bangladesh over the next 18 months.

Resource 2 – Internal HR report “Navigator turnover remains high at 28% annually. Interviews cite poor training, emotional fatigue, and a disconnect between field roles and central ops decisions. Navigators receive basic onboarding but no career pathway or local adaptation in training. They also report being treated more as hardware support than as care professionals. Headquarters recently introduced a CRM-linked performance bonus system based on call completion and upsell conversions—but this has increased pressure on already fatigued staff.”

Resource 3 – Weekly Ops Brief (March 2025)

Metric	Vietnam (live)	Indonesia (pilot)
Avg. pod uptime	94%	71%
Avg. medicine delivery time	26 hours	61 hours
Navigator-reported escalations	9.2/week	18.4/week
Inventory out-of-stock events	3.1/week	7.5/week

Visual suggestion: This operations table can be converted into a bar chart or dashboard screenshot to test interpretation skills.

Resource 4 – Brand perception audit (external) In Vietnam, SolvoHealth scores high for accessibility and usefulness, but low for empathy and personalisation. Many patients feel “talked to” by doctors, not “heard.” In Indonesia (pilot), users were confused by medical terms and unable to complete video sessions. 47% believed the navigator was “just a receptionist.” A competitor, SehatNow, offers similar services but invests heavily in navigator-patient relationship-building and community health workshops to build trust.

Resource 5 - Email from Head of Marketing to CEO

Resource 6 – Slack thread @Linh (HR): “One navigator resigned mid-shift—said she felt like a vending machine operator.” @Dara (Marketing): “How are we still pushing bonuses on upsells when trust is crumbling?” @Tung (Ops): “I’ll review the KPIs. But we can’t rebuild loyalty with posters.” @Dara: “Maybe not. But we can’t scale a service that feels robotic either.” *Note Slack is an internal team communications tool

1.

With reference to Resource 2, describe one HR issue that may impact SolvoHealth’s service performance.

[2]

2.

Explain one marketing challenge and one operations challenge SolvoHealth may face as it expands across Indonesia and Bangladesh.

[6]

3.

Using all the resources provided and your knowledge of business management tools and theories, recommend a possible plan of action for SolvoHealth over the next five years.

[17]

Question 3

HLPaper 3

Global Solar Solutions (GSS)

Resource 1 – Background of the social enterprise Three years ago, electrical engineer and entrepreneur Nadira Khan founded Global Solar Solutions (GSS) as a social enterprise in Morocco. Her goal was to provide affordable, modular solar lighting kits to off-grid rural communities. These kits, manufactured at GSS’s urban facility, include rechargeable LED lights and mobile charging ports. GSS reinvests 100% of profits into R&D and local hiring. GSS operates in partnership with local NGOs and community councils. Its workforce includes 40 technicians and 20 community trainers who educate households about solar usage and maintenance. GSS applies lean production, Kaizen, and maintains a strong internal emphasis on quality control and after-sales support.

Resource 2 – Recent internal report on workforce issues "High staff turnover and trainer burnout have increased over the past 12 months. Trainers, who work in remote villages for weeks at a time, report fatigue and a lack of recognition. Some have requested additional health support and clearer promotion opportunities." The HR department suggested non-financial incentives such as increased job rotation and monthly feedback sessions but reported mixed engagement.

Resource 3 – Email from the Director of Rural Development (DRD) To: nadira.khan@GSS.org Subject: Expansion proposal Dear Ms. Khan, We are impressed by GSS’s impact. The Ministry would like to propose a contract to expand the solar program to 80,000 homes across North and West Africa over five years. Your team would need to train local technicians and build capacity in three new countries. Please note, the contract requires local sourcing of at least 60% of parts. We will require an initial trial rollout in 5,000 homes and evidence of social impact. Regards, Director, DRD

Resource 4 – Extract from a marketing audit summary GSS currently relies on word-of-mouth and NGO referrals. Its brand is associated with trust and affordability. However, a 2024 brand perception survey in new markets revealed low awareness and concerns about product durability compared to larger multinationals such as SolarX. GSS’s marketing team is small (3 staff) and has no formal digital strategy. There is also no localized messaging for francophone West African markets.

Resource 5 – Operations update from the Head of Production Our current facility is operating at 92% capacity. To meet a major scale-up, we would need to either expand production or outsource subassembly. We have identified two regional partners with experience in sustainable component manufacturing. However, we are concerned about quality assurance if we lose full process control.

Resource 6 – Excerpt from a local newspaper article “Access to solar power has transformed daily life in remote villages. Children now study at night, families charge phones to access mobile banking, and kerosene usage has dropped. However, NGOs report that replacement parts for some GSS kits have been slow to arrive, creating frustrations in isolated regions.”

1.

With reference to business management motivation theory, describe one need that GSS satisfies for rural households requiring solar lighting.

[2]

2.

Explain one human resource challenge and one operations challenge GSS may face if it accepts the DRD expansion contract.

[6]

3.

Using all the resources provided and your knowledge of business management tools and theories, recommend a possible plan of action for GSS over the next five years.

[17]

Question 4

HLPaper 3

Elevate Health Tech (EHT)

Resource 1 – Background of the organization Elevate Health Tech (EHT) is a social enterprise based in Peru. Founded in 2021 by two biomedical engineers, it develops low-cost, portable diagnostic devices (such as digital stethoscopes and glucose meters) for use in rural and underserved communities across Latin America. EHT reinvests all profits into R&D and local employment programs. EHT has grown quickly, scaling from 5 to 38 employees in two years. It operates as a private limited company, with both founders holding equal ownership and decision-making authority.

Resource 2 – Statement from the HR Director "Our team is motivated by our mission, but we’re facing growing pains. We’ve recently hired 12 new staff, many with limited technical background. We have no formal training programme or organizational structure. Employees report confusion about job roles, and productivity varies significantly across teams. The co-founders are very hands-on, but this is becoming unsustainable."

Resource 3 – Loan proposal from the Development Impact Bank (DIB) DIB is prepared to offer EHT a $750,000 low-interest loan to expand production and distribution across four Andean countries. The loan would cover machinery upgrades and recruitment but requires EHT to submit quarterly financial statements and maintain a current ratio of at least 1.5 throughout the term. A grace period of 18 months will apply before repayments begin.

Resource 4 – Excerpt from EHT’s financial summary (unaudited, 2024)

Item	Amount (USD)
Current assets	$230,000
Current liabilities	$180,000
Non-current liabilities	$50,000
Retained profit	$40,000
Total equity	$100,000

Note: Fixed assets are fully depreciated and no longer productive.

Resource 5 – Email from the Head of R&D "To remain competitive, we need to launch two new diagnostic products within the next 18 months. The current design lab is at capacity. We either need to lease a second lab or invest in automation. The team is overworked and we’ve lost two engineers to burnout. I’m also concerned about our lack of appraisal or performance review systems."

Resource 6 – Mission statement (from company website) We believe affordable diagnostics are a human right. We exist to empower healthcare workers and communities with reliable tools, local jobs, and dignity-driven innovation.

1.

With reference to the stimulus, describe one internal issue that might arise from EHT’s current ownership structure.

[2]

2.

Explain one human resource challenge and one financial challenge that EHT may face if it accepts the DIB loan and scales up

[6]

3.

Using all the resources provided and your knowledge of business management tools and theories, recommend a possible plan of action for EHT over the next five years.

[17]

Question 5

HLPaper 2

SVC

SVC has expanded by merging with a regional competitor, KleanCo, in Asia. After the merger, the following financial and HR data were reported:

Table 1. Financial and HR Data for SVC-KleanCo (Year 1 after merger)

Descriptor
Gearing ratio	62%
Current ratio	0.8 : 1
Labour turnover	18%
Cash inflow from operations	$850,000
Cash outflow for investments	$1,400,000

In addition, there have been several disputes between management and employees, partly due to cultural differences between the original SVC workforce and KleanCo’s workforce.

1.

Comment on whether SVC-KleanCo's liquitity position is considered healthy.

[2]

2.

Explain the relationship between investment, profit, and cash flow in SVC-KleanCo’s situation.

[2]

3.

Using the data provided, suggest one strategy that SVC-KleanCo could implement to improve its cash flow situation.

[2]

4.

Identify one approach an employer could use to manage conflict arising during this merger.

[2]

5.

Explain one likely reason for the labour turnover figure at SVC-KleanCo.

[2]

Question 6

HLPaper 2

BrightPath Ltd.

BrightPath Ltd. is a private limited company that provides digital career coaching platforms to secondary schools and universities. The business is at a transitional stage: after rapid early growth, profits have started to plateau. In response, the board has appointed a new CEO with a highly authoritarian leadership style and a focus on efficiency and results.

However, this shift in management approach has clashed with BrightPath’s historically person-oriented corporate culture, which emphasised innovation, inclusivity, and autonomy. Employee morale has declined, and recent internal surveys suggest that staff are increasingly demotivated due to perceived lack of recognition and limited input in decision-making.

The finance department has provided the final accounts and key data from 2024, and the company is also considering raising capital to fund an AI-integrated platform upgrade. The CEO has asked for a financial and cultural analysis to support future strategic decisions.

Table 1: Selected Financial Data – BrightPath Ltd. (2024)

Item	Amount (£)
Revenue	2,200,000
Cost of goods sold	1,000,000
Operating expenses	950,000
Net profit	250,000
Capital employed	1,800,000
Average stock	200,000

1.

Explain how a mismatch between leadership style and corporate culture might affect employee motivation.

[2]

2.

Calculate the return on capital employed (ROCE) for BrightPath Ltd. Show all your working.

[2]

Question 7

HLPaper 2

TerraNova Ltd.

TerraNova Ltd. is an agricultural technology company based in New Zealand that develops vertical farming systems for urban food production. The company has a strong innovative corporate culture that values experimentation, sustainability, and cross-functional collaboration. However, as TerraNova scaled operations to meet increasing demand, it introduced stricter performance targets across departments.

These changes, including the removal of flexible working arrangements in the production team, led to a deterioration in industrial relations. Employee representatives submitted a formal grievance to management, citing the lack of consultation and increased stress levels among staff. Senior leaders are now reviewing TerraNova’s budget and financial performance for Q2 2024 to assess whether further cost-cutting is needed.

The company is also exploring external sources of finance to fund a new training and automation programme aimed at improving long-term efficiency and reducing employee workload.

Table 1: Budgeted vs Actual Figures – Q2 2024

Item	Budgeted (NZD)	Actual (NZD)
Sales revenue	2,400,000	2,200,000
Cost of goods sold	1,050,000	1,160,000
Operating expenses	920,000	980,000
Net profit	430,000	60,000

1.

Calculate the sales variance and total cost variance for TerraNova Ltd. in Q2 2024. Show all your working.

[2]

2.

Comment on how the variances and final accounts reflect the financial impact of TerraNova’s internal changes.

[2]

3.

Explain how TerraNova’s corporate culture may have clashed with recent changes to working conditions.

[2]

4.

Suggest one internal and one external source of finance TerraNova Ltd. could consider to fund its employee training and automation programme.

[2]

5.

Outline how improved industrial relations could contribute to TerraNova’s long-term financial performance.

[2]

Question 8

HLPaper 2

LunoCare Ltd.

LunoCare Ltd. is a healthcare technology company that recently merged with a traditional medical device manufacturer. After the merger, the company faced tension between the tech team’s flexible leadership style and the acquired firm’s hierarchical culture.

The human resources department is implementing new performance review processes to support the integration and is piloting employee-driven feedback initiatives. Meanwhile, management has tied part of employee bonuses to company profitability this year.

Table 1. Draft statement of Profit and Loss of LunoCare Ltd. for 2023

Statement of Profit and Loss for 2023 (in $'000)
Revenue	5,600
Cost of goods sold (COGS)	(3,200)
Gross profit	________
Expenses	(2,000)
Net profit before tax	________

Table 2. Draft statement of Financial Position of LunoCare Ltd. for 2023

Statement of Financial Position for 2023 (in $'000)
Non-current assets	3,000
Current assets	1,200
└── of which: Cash	200
Current liabilities	(1,000)
Non-current liabilities	(800)
Net assets	2,400

Additional notes:

Some employees expressed concern about how much data management uses in decision-making versus relying on leadership intuition.
The finance director assigned departmental managers responsibility for controlling specific revenue and cost streams.

1.

Calculate the missing figures for net profit before tax.

[2]

2.

Outline one advantage of involving employees in providing feedback on their own performance.

[2]

3.

Explain one potential cultural clash that may arise from LunoCare Ltd.’s recent merger.

[2]

4.

State one reason why different stakeholders would be interested in LunoCare Ltd.'s financial accounts.

[2]

5.

Identify one advantage of assigning departmental managers responsibility for both revenue and cost streams at LunoCare Ltd

[2]

Question 9

HLPaper 3

FreshFusion Ltd

Resource 1 - Industry Article “FreshFusion Tackles High Turnover in the Health Food Sector”

Resource 2 - Balance Sheet (2023) FreshFusion Ltd. Balance Sheet - As of December 31, 2023

Item	Amount
Cash	£500,000
Inventory	£250,000
Property, Plant & Equipment	£3,000,000
Other Current Assets	£100,000
Total Assets	£3,850,000

Item	Amount
Accounts Payable	£1,000,000
Accrued Salaries	£200,000
Long-Term Debt	£2,500,000
Shareholders’ Equity	£1,150,000
Total Liabilities & Equity	£3,850,000

FreshFusion’s equity has steadily increased, thanks to its brand appeal and expanding customer base. However, accrued salary expenses reveal the strain on payroll, and accounts payable remains high, indicating potential cash flow challenges in meeting obligations.

Resource 3 - Excerpt from Employee Satisfaction Survey (2023) Summary of Employee Feedback: Positive Comments: Employees appreciate FreshFusion’s commitment to sustainability, especially through using local suppliers and eco-friendly packaging. They feel aligned with the company’s values and are proud of their work. Negative Comments: Concerns were raised about long hours, inconsistent scheduling, and lack of growth opportunities. Employees express a need for career progression and better work-life balance.

Resource 4 - Social Media Post (Instagram) @FreshFusionUK:

Resource 5 - Market Report Excerpt "Health Food Retailers Face Staffing Struggles in Competitive Market" Health food retail is a high-turnover sector, with 35% of employees leaving within their first year. Companies like FreshFusion are encouraged to adopt new employee-centric strategies, such as internal promotions, career development programs, and employee wellness initiatives, to remain competitive. The report highlights that companies with lower turnover rates have successfully implemented flexible scheduling and robust training programs to build a committed workforce.

1.

Using an appropriate business management theory, describe a human need that FreshFusion fulfills for its employees.

[2]

2.

Explain two challenges FreshFusion faces in managing its human resources effectively. Support your answer using information from the case study and resources provided.

[6]

3.

Using all the resources provided and your knowledge of business management, recommend a strategic plan to improve employee retention at FreshFusion over the next three years. Your response should consider employee development, scheduling flexibility, wellness initiatives, and compensation.

[17]

Question 10

HLPaper 3

UrbanEats Ltd.

Resource 1 - Excerpt from Company Website

Resource 2 - Balance Sheet (2023) UrbanEats Ltd. Balance Sheet as of December 31, 2023 Assets Current Assets

Item	Amount
Cash	£1,200,000
Inventory	£600,000
Accounts Receivable	£800,000
Total Current Assets	£2,600,000

Non-Current Assets

Item	Amount
Property, Plant & Equipment	£3,000,000
Intangible Assets	£200,000
Total Non-Current Assets	£3,200,000

Liabilities Current Liabilities

Item	Amount
Accounts Payable	£700,000
Short-term Debt	£300,000
Total Current Liabilities	£1,000,000

Non-Current Liabilities

Item	Amount
Long-term Debt	£1,500,000
Total Non-Current Liabilities	£1,500,000

Total Assets | £5,800,000 | Total Liabilities | £2,500,000 | Equity

Item	Amount
Shareholder Equity	£3,300,000
Total Liabilities & Equity	£5,800,000

Despite recent revenue growth, UrbanEats’ increasing liabilities raise concerns about long-term financial sustainability.

Resource 3 - Email from CFO to CEO

Resource 4 - Interview Excerpt with the CEO In a recent interview with Finance Today, CEO Maya Simmons shared her vision for UrbanEats. “We are excited about our growth but know we must be strategic to maintain profitability. Our commitment to sustainability and affordability is essential, but we also recognize the importance of financial health. Exploring franchising is one option, though I want to ensure it aligns with our brand values.”

Resource 5 - Social Media Post by UrbanEats (Instagram)

1.

Identify a human need that UrbanEats Ltd. fulfills through its mission of providing plant-based and sustainable meals. Explain how UrbanEats addresses this need through its products and initiatives.

[2]

2.

Discuss two significant challenges UrbanEats Ltd. faces in maintaining profitability and competitive advantage in the fast-casual dining sector. Use relevant resources from the case study to support your answer.

[6]

3.

Based on the resources provided and your knowledge of business management principles, outline a strategic plan for UrbanEats Ltd. to enhance its financial performance and market positioning over the next five years. Your plan should include recommendations on product differentiation, digital marketing strategies, consumer engagement initiatives, and adaptability to market trends.

[17]

2.5 Organizational (corporate) culture (HL only) Questionbank