...been named the Chief Financial Officer (CFO) of a two year old company, CUNY Analytics. Financials have been prepared by a bookkeeper. As CFO, you responsible for the preparation of accurate financials, analysis and review of the financials before they are released and communication of the results of your company to banks, investors, creditors and the government, as necessary. Please complete the following: a. What are the four major financial statements and, in depth, discuss their purpose. • Income Statement Reports revenues and expenses for a specific period of time. A firm's revenues, gains, expenses and losses are listed on the income statement. Revenue is money earned from a company’s normal business operations. The expenses on the income statement are the costs associated with earning the revenue. When a company sells one of its assets, it can experience a capital gain or loss. Revenues minus expenses, plus gains minus losses, equal net income or net loss. The dollar amount of net income listed on the income statement is also found on the cash flow statement under the operating activities section. • Balance Sheet The Balance sheet has two main purposes. First, it presents a snapshot at a point in time. Second, it helps to improve understanding, as companies group similar assets and similar liabilities together. The balance sheet reports assets and claims to assets at a specific point in time. It includes the elements of the accounting equation: assets equal...
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...McCleneghan Colorado Technical University Online Annual Reports An annual report is a document that companies must provide to their shareholders that describe the organizations operations and financial conditions (Annual Reports, 2014). There are many components that an annual report usually contains such as different financial highlights, management discussion and analysis, auditors reports, and corporate information. All annual reports revolve around financial data, so it is safe to say that when beginning a report, you need to focus on the fiscal numbers. To gather this data, you will want to sit down with the accounting department to review that previous year’s performance. Once this information is reviewed, it will help to provide direction for the report. These reports also tend to act as a sort of marketing devise to share holders and potential investors to show case the company’s strengths. This report generally contains six different sections: a letter from the chairmen, the chief executive’s review, a profile of the board of directors, financial reports, audit reports, and the financial highlights. The chairman’s letter or letter to the shareholders usually acts as a summation of the annual report and reviews the company’s performance over the past year. This tends to be the most read part of the annual report (Annual Reports, 2014). The next section is usually a statement from management that discusses and analyzes sales, profit margins, operating income, and net income...
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...Week 1: Overview of Financial Statements - Discussion Accounting is a way of tracking transactions and organizing them into concise reports to be used by investors, principals of companies, or government agencies to be able to control the financial health of a company, family, or an individual. The book uses the example of a checkbook, which is apropos, as I don't know of anyone who has never "bounced" a check due to careless recording of a transaction. Accounting involves a level of trust, that the reporting is accurate and true. Unfortunately, trust is not enough, and it must be standardized and regulated. Accounting is a way to maximize a finite resource (capital) and allocate it in the most efficient way. Accounting is the bookkeeping methods involved in making a financial record of business transactions. It is also the preparation of statements concerning the assets, liabilities, and operating results of a business. Accounting is part of every day life for those who pay bills as well. Honestly in the business community there has to be accounting in place to see where the business stands. What is GAAP? What is the purpose of GAAP? | | | GAAP are the rules that stop accountants from manipulating numbers and formulas to represent whatever it is they want the numbers to say rather than it being an actual reflection of the company's performance. these principles are put in place to prevent the over valuation of company's and overstating of profits that...
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...Achievements and Failure – Harmonization Process – EU & IASB International business are no longer confronted only with Accounting problems, which ends at domestic borders. When companies, equity, or capitials cross borders they are confronted with new cultures, challenging new laws and differences in political systems. Besides that there are the differences in Accounting Standards abroad. For example there are the US gaap and IAS. The lack of similar Accounting Standard led to problems in comparing financial datas and informations. Another issue is that not all financial statements or Accounting Standards are accepted in all stock exchanges. Example, companies who would like to be listed in New York Stock Exchange, have to have additional reporting, other than their national standards (reporting) in accordance with the prevailing US-Gaap. This means extra work, example reconciliation that equates to extra costs. The rapid emergence of MNE highlight the problems further. This is where the work of EU and IASB becomes internationally crucial. The aim was not only to avoid diversity of financial statements, ‘birth of two standard-reporint’, to promote foreign investment but to also reduce extra cost in producing two repors. Their journey (EU and IASB) were however not smooth sailing. IASB and EU-failure :- Initial attempt to harmonise accounting practice by EU was via the issuing the directives. There are several setbacks;- 1- Measurement options, apply for different...
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...Business Analysis Part II April 22, 2012 The financial heath of a company is detrimental to survival. While conducting research on Proctor and Gamble’s financial statements there were many interesting finds. In this paper I will examine P&G’s financial heath and how it compares to its competitors. I will also be discussing P&G’s technological advantages and how globalization has affected P&G’s business strategies. In closing I will conduct a benchmark analysis for the current industry. P&G Financial Heath Procter & Gamble is America’s premier maker of domestic products, with at least 250 brands in six main categories. ("Corporate watch," 2011) While researching P&G financial heath I found them to be in good shape in contrast to previous years in most areas. Some of P&G’s financial highlights include net sales of 82.6 billion in 2011. This is a 3.7 billion dollar increase in net sales from 2010. P&G’s current operating cash flow for 2011 is 13.2 billion and its diluted net earnings (per common share) is $3.92. ("Financial highlights," 2011). According to Yahoo Finance, P&G announced that its board of directors has ratified a 7% hike to its regular quarterly dividend. This is the 56th uninterrupted year for which the company increased its quarterly dividend. (Equity Research, 2012) After comparing P&G to its two top competitors, Johnson & Johnson and Kimberly-Clark Corporation I discovered P&G’s power in this industry. P&G...
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...McDonalds, Fiscal Year 2012 Keith R. Jones Strayer University Accounting I Professor Togbenou November 25, 2013 1. Identify and explain the main sections of the annual report. The main sections of the McDonalds Corporations annual report consist of a 6 year Summary which provides the user with a brief overview of how the corporation has done over the previous 6 years which also includes the current year’s annual report. The report shows items that are on other parts of the annual report such as total revenues, net income, total assets and total shareholders’ equity. The 6 year Summary also shows items such results from company-operated and franchised restaurants giving a total under “system wide restaurants”. The 6 year Summary also shows franchised sales but notes that “franchised sales are not recorded as revenues by the company”. The information is provided to give an understanding of the corporations’ performance financially. The Management’s Discussion and Analysis of Financial Condition and Results of Operations provides the user with an overview as to a description of the business, strategic direction and financial performance for the U.S. and Europe. It also gives highlights from the year, and an outlook for the next or current year (2013) for the U.S. and Europe. The Consolidated Statement of Income provides total revenues through company operated restaurant sales and expenses which includes franchised restaurants-occupancy expenses and net...
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...customers 6 2.1.2 Bargaining Power of Supplier 7 2.1.3 Risk of Entry by Potential competitors 7 2.1.4 Threat of substitutes 7 2.2 Competitor Analysis 8 3. Comparison of Financial Performance 10 3.1 Competitor Introduction 10 3.2 Ratio analysis 10 3.2.1 Net Interest Margin 11 3.2.2 Operating profit margin 12 3.2.3 Return on Equity ratio 13 3.2.4 Return on Capital Employed 14 3.2.5 Asset Turnover 15 3.2.6 Gearing ratio 16 3.2.7 Interest Cover 17 3.2.8 Earnings per Share Ratio 17 4 Analysis of the financing sources 18 4.1 Purchase of Ordinary share 19 4.2 Purchase of Debentures 20 5 Recommendation 21 6 Conclusion 22 References 23 Book references 23 Web references 24 1. Introduction With the increase of trading activities within the people the banks came to play with a major importance. The below report consist of an analysis of one of the major commercial banks in Sri Lanka, which is Bank of Ceylon , popularly known as BOC. The report analyses the role and function of Financial Information within the company and the importance of carrying out a competitor analysis. In doing so the first part of the report consists of an analysis of the company as well as the industry. This further extends to identifying and analysing the financial data and how its performance has been carried out over the past years considering 3 main years specifically i.e. 2002, 2007 and 2012 which is with 5 year gaps to analyse the company’s...
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...Wholesale Corporation). At the very beginning of the Costco’s 2012 annual report, a financial highlights page which bar-charts depict its performance over five progressive years from 2008 to 2012 in the following categories: Warehouses in Operation; Net Sales; Net Income; Comparable Sales Growth; Membership; Average Sales per Warehouse; and Selling, General and Administrative Expenses which were clearly marked with any variances to the data being compared. The bar charts provided a basis for accounting analysis by depicting intracompany basis of comparison from one year to the next, and using a horizontal analysis approach. An “intracompany” basis of analysis compares an item or financial relationship within a company; a “horizontal analysis,” also called “trend analysis” is a way of evaluating a series of financial statement data over a period of time, with a purpose of determining changes in a company’s financial performance (Weygandt, Kimmel, & Kieso, 2009). Utilizing a means of comparative analysis is essential and significant in analyzing a company’s solvency, liquidity, and profitability. It assists a company’s internal and external stakeholders; its customers, employees; or the government to assess a company’s financial situation. Costco addresses its shareholders in the introduction of the annual report giving an overview of operating performance, pointing out its cash flow highlights. It includes a business overview charting nets sales, revenue from its ancillary...
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...Outline Part 1 Background and Overview Part 2 US GAAP and IFRS Part 3 China GAAP and IFRS Part 4 Summary of Convergence Process Part 5 Pros & Cons of Convergence Part 6 The reasons for differences in accounting practice ww.ifrs.org + The International Accounting Standards Board + The International Accounting Standards Committee (IASC) Foundation + Objective – a single set of global financial reporting standards + Aim – convergence between national standards and international standards + IFRS Framework + IFRS SMEs + Supported by the Group of 20 Leaders (G20) who, at their September 2009 meeting in Pittsburgh, US. Country Status for listed companies as of April 2010 Argentina Required for fiscal years beginning on or after 1 January 2011 Australia Brazil Canada Required for all private sector reporting entities and as the basis for public sector reporting since 2005 Required for consolidated financial statements of banks and listed companies from 31 December 2010 and for individual company accounts progressively since January 2008 Required from 1 January 2011 for all listed entities and permitted for private sector entities including not-for-profit organizations Country China Status for listed companies as of April 2010 Substantially converged national standards European All member states of the EU are required to use IFRSs as adopted by the EU for listed Union companies since 2005 France Germany India Indonesia Italy Japan Mexico Required...
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...ACCOUNTING TRANSPARENCY Charles Katoroogo Prof Brandy Havens ACC 303 12/1/2013 ACCOUNTING TRANSPARENCY Accounting is mainly concerned with general rules, concepts and principles that are established with the purpose of governing different fields of financial reporting. Accounting principles are also known as accounting principles and guidelines, these acts as the base on which more complex and critical rules are based. The authority responsible for issuing the accounting standards (i.e. financial accounting standard board) also uses these basic principles to formulate the accounting standards in a more efficient manner. Generally accepted accounting principles (GAAP) consist of various rules and principles which are used for preparing the financial statements. GAAP consist of three important fields:- 1) Basic accounting principles and guidelines. 2) Various accounting standards issued by FASB. 3) Generally accepted practices in the industry. All those companies which are providing its financial statement to public is required to follow the GAAP while preparing the financial statements. Further, if the company is a listed entity then the federal law of the nation requires the company to get its accounts audited by an independent certified public accountant. There has been various corporate scams in past years which has made it compulsory for the regulatory bodies to create various laws and amend the existing laws so that more accurate and transparent financial...
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...Chapter 1 Financial Statements and Business Decisions ANSWERS TO QUESTIONS 1. Accounting is a system that collects and processes (analyzes, measures, and records) financial information about an organization and reports that information to decision makers. 2. Financial accounting involves preparation of the four basic financial statements and related disclosures for external decision makers. Managerial accounting involves the preparation of detailed plans, budgets, forecasts, and performance reports for internal decision makers. 3. Financial reports are used by both internal and external groups and individuals. The internal groups are comprised of the various managers of the entity. The external groups include the owners, investors, creditors, governmental agencies, other interested parties, and the public at large. 4. Investors purchase all or part of a business and hope to gain by receiving part of what the company earns and/or selling the company in the future at a higher price than they paid. Creditors lend money to a company for a specific length of time and hope to gain by charging interest on the loan. 5. In a society each organization can be defined as a separate accounting entity. An accounting entity is the organization for which financial data are to be collected. Typical accounting entities are a business, a church, a governmental unit, a university and other nonprofit organizations such as a hospital and a welfare organization. A...
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...currently the Professor of Accounting at the University of Chicago, Graduate School of Business. He is also the David G. Booth Faculty Fellow. Prior to this position, Professor Leuz was the Harold Stott Term Assistant Professor in Accounting at the Wharton School of the University of Pennsylvania and Fellow at Wharton’s Financial Institution Center. His research interests include transparency and corporate governance, financial disclosure and securities regulation, and the links between the institutions of market economies. Professor Leuz earned his doctoral degree and “Habilitation” at the Goethe University Frankfurt in Germany. His most recent publications have appeared in the Journal of Financial Economics, the Journal of Accounting and Economics and the Journal of Accounting Research. He is an Associate Editor of the Journal of Accounting and Economics and serves currently on the Editorial Board of The Accounting Review, the Journal of Accounting Research, the Journal of Business, Finance and Accounting, and the International Journal of Accounting. He has received several grants and honors, of which the Geewax Terker Prize is the latest. Peter Wysocki Professor Peter Wysocki is an associate professor of management at the MIT Sloan School of Management and has been a member of the MIT accounting faculty since 2001. Peter’s research interests include the links between the institutions of market economies, corporate governance, and the accounting disclosures of U.S. and international...
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...of more than eighty operating companies in its stable, the Group’s diversity elevates it to a brand with unique character and promise. PROTON, Alam Flora, PUSPAKOM, Pos Malaysia, MODENAS, Bank Muamalat, Glenmarie Properties – these are some of the household names that form a part of the DRB-HICOM Group. From the Automotive and Services sectors to the Property, Asset and Construction sector, DRB-HICOM’s operating companies have always had a strong presence in the local market. Helmed by bold leadership and imbued with core values, strong work ethics and a vision to be number 1, the DRB-HICOM brand is well-positioned to go a step further to become a leading global brand in the future. OUR VISION to be number 1 and continuously excel in all that we do OUR MISSION to lead in the growth of the nation in the areas of DRB-HICOM’S core businesses SHARED VALUES excellence decorum teamwork integrity innovation quality transparency 2 Vision & Mission KEY INITIATIVES 112 114 Human Capital Development Corporate Responsibility HIGHLIGHTS 4 7 Notice of Annual General Meeting Statement Accompanying Notice of 24th Annual General Meeting FINANCIAL STATEMENTS 122 126 Directors’ Report Financial Statements 126 Statements of Comprehensive Income 128 Consolidated Statement of...
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...of more than eighty operating companies in its stable, the Group’s diversity elevates it to a brand with unique character and promise. PROTON, Alam Flora, PUSPAKOM, Pos Malaysia, MODENAS, Bank Muamalat, Glenmarie Properties – these are some of the household names that form a part of the DRB-HICOM Group. From the Automotive and Services sectors to the Property, Asset and Construction sector, DRB-HICOM’s operating companies have always had a strong presence in the local market. Helmed by bold leadership and imbued with core values, strong work ethics and a vision to be number 1, the DRB-HICOM brand is well-positioned to go a step further to become a leading global brand in the future. OUR VISION to be number 1 and continuously excel in all that we do OUR MISSION to lead in the growth of the nation in the areas of DRB-HICOM’S core businesses SHARED VALUES excellence decorum teamwork integrity innovation quality transparency 2 Vision & Mission KEY INITIATIVES 112 114 Human Capital Development Corporate Responsibility HIGHLIGHTS 4 7 Notice of Annual General Meeting Statement Accompanying Notice of 24th Annual General Meeting FINANCIAL STATEMENTS 122 126 Directors’ Report Financial Statements 126 Statements of Comprehensive Income 128 Consolidated Statement of...
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...Accountants in Australia GAAP-based financial reporting: measurement of business performance charteredaccountants.com.au Professor Stephen Taylor, The University of New South Wales, Sydney, Australia The Institute of Chartered Accountants in Australia The Institute of Chartered Accountants in Australia (the Institute) is the professional body representing Chartered Accountants in Australia. Our reach extends to more than 53,000 of today and tomorrow’s business leaders, representing some 43,000 Chartered Accountants and 10,000 of Australia’s best accounting graduates who are currently enrolled in our world-class post-graduate program. Our members work in diverse roles across commerce and industry, academia, government, and public practice throughout Australia and in 107 countries around the world. We aim to lead the profession by delivering visionary thought leadership projects, setting the benchmark for the highest ethical, professional and educational standards and enhancing and promoting the Chartered Accountant brand. We also represent the interests of members to government, industry, academia and the general public by actively engaging our membership and local and international bodies on public policy, government legislation and regulatory issues. The Institute can leverage advantages for its members as a founding member of the Global Accounting Alliance (GAA), an international accounting coalition formed by the world’s premier accounting bodies. The GAA has a membership...
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