...Interpreting Financial Results FIN/571 – Foundations of Corporate finance February 4, 2016 Abstract This summary examines Marathon Oil Corporation’s financial statements from the past three years. Financial ratios such as liquidity ratios, leverage ratios, and solvency ratios are discussed and interpreted against the company’s historical data and compared to industry benchmarks. The financial ratios will be used to determine the company’s current financial position how they rank compared to other industry companies. Interpreting Financial Results A financial ratio is an effective instrument that is used in conducting company analysis. These ratios are also useful in important business decision making (Hoskin, Fizzell & Cherry, 2014). There are a number of financial ratios that can be used to conduct analysis. The aspect of the financial comparisons that are under question, determines which financial ratios are best to use. Marathon Oil Corporation is an independent international company and was originally called Ohio Oil Corporation. The organization was originally established in 1887 (Marathon Oil, 2015). As of today, Marathon Oil continues to pull in profits despite the tremendous drop in oil prices. Marathon Oil functions as an energy company and operates in three segments. The company supplies products and services to both large and small organizations. Marathon Oil’s financial data, for years 2014, 2013, and 2012 shown below, provides a clear...
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...growth is the profit made from investment, and thus, to determine if buying shares in Blackmore’s would provide my entity with capital growth, profitability ratios should be considered, such as Return on Assets (ROA); which quantify the profit and operational success of the company for a given period of time. The ROA ratio measures the overall profitability with respect to investment in assets. Blackmore’s ROA of 17.57% (18 cents) indicates a high profitability rate. As investment professionals consider it a positive rate if the ROA of a company is over 5%, Blackmore’s 17.57% ROA indicates that capital growth is possible under investment of their shares. (Khanna, 2012) Additionally, Debt to Assets ratio should be considered in making this financial decision, as it indicates degree of leverage (percentage of total assets funded through debt). The company’s debt...
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...The City of Seattle, Washington Comprehensive Annual Financial Report For the Fiscal Year Ended December 31, 2013 Co ompre ehens sive Annual l Finan ncial R Repor rt For the F iscal Yea F ar Ended Decem mber 31, 2013 The City Seatt y of S tle De epartment t of Financ ce and Adm ministrativ ve Services s Introduction Table of Contents Comprehensive Annual Financial Report For the Year Ended December 31, 2013 TABLE OF CONTENTS Page INTRODUCTION Table of Contents ....................................................................................................................................................... V Organizational Chart – City ..................................................................................................................................... XI Elected Officials ...................................................................................................................................................... XII Letter of Transmittal .............................................................................................................................................. XIII Certificate of Achievement for Excellence in Financial Reporting ...................................................................... XIX Organizational Chart – Department of Finance and Administrative Services ........................................................ XX FINANCIAL SECTION INDEPENDENT AUDITOR’S REPORT State of Washington...
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...City of Charlotte, North Carolina Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2012 Mayor: Anthony Foxx Mayor Pro Tem: Patrick Cannon City Council: John Autry Michael Barnes Warren Cooksey Andy Dulin Claire Green Fallon David Howard Patsy Kinsey LaWana Mayfield James Mitchell, Jr. Beth Pickering City Manager: W. Curtis Walton, Jr. Prepared by the City of Charlotte Finance Department Greg C. Gaskins, Chief Financial Officer Teresa T. Smith, Chief Accountant This document is available online: CITY OF CHARLOTTE, NORTH CAROLINA TABLE OF CONTENTS Page INTRODUCTORY SECTION Letter of Transmittal ....................................................................................................................................... 1 Certificate of Achievement for Excellence in Financial Reporting ............................................................... 14 Organizational Chart .................................................................................................................................... 15 FINANCIAL SECTION Independent Auditors’ Report ...................................................................................................................... 17 Management’s Discussion and Analysis ..................................................................................................... 19 Basic Financial Statements: Government-wide Financial Statements: Statement of Net Assets ..................................
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...controls Taxation Documents on display Purchases of equity securities by the issuer and affiliated purchasers Fees and charges payable by a holder of ADSs Fees and payments made by the Depositary to the issuer Called-up share capital Administration Annual general meeting Exhibits BP Annual Report and Form 20-F 2010 83 Directors and senior management 84 87 Directors and senior management Directors’ interests 89 Corporate governance 90 105 106 106 107 108 Board performance report Corporate governance practices Code of ethics Controls and procedures Principal accountants’ fees and services Memorandum and Articles of Association 141 Financial statements 142 Consolidated financial statements of the BP group 150 Notes on financial statements 228 Supplementary information on oil and natural gas (unaudited) PC1 Parent company financial statements of BP p.l.c. 111 Directors’ remuneration report 112 Part 1 Summary 114 Part 2 Executive directors’ remuneration 120 Part 3 Non-executive directors’ remuneration UNITED...
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...REPO RT ON CEO(S A ND CFO (S RESP ONSIBILITIES I 078 INDEPENDENT A UDITOR#S REPORT I 08/ CONSOLIDATED BALA NCE SHEET I 081 CONSOLIDATED PROFIT A ND LOS S A CCO UNT I 083 CONSOLIDATED STATEMENT OF CAS H FLOW I 08 5 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY I 086 CONSOLIDATED LIQ UIDITY S TATEMENT I 087 BALANCE S HEET I 088 PRO FIT AND LOSS ACCOUNT I 1/ 0 STATEMENT O F CASH FLOW I 1/1 STATEMENT O F CHA NGES IN EQUITY I 1/2 LIQUIDITY STATEMENT I 1/3 NO TES TO THE FINANCIAL STATEMENTS I 1/4 ANNEXURE I 1 48 OFF S HORE BA NKING UNIT )O BU* I 160 MTB S ECURITIES LIMITED I 168 MTB CAP ITAL LIMITED I 18 0 MTB EXCHANGE )UK* LIMITED I 2/1 IUU[I S XMWVXZ +)*- = *12 DPZY\^ YX 46A#] LXO 47A#] DP]ZYX]TMTVT^TP] gqq scb `w rfc Ilqrgrsrc md Cf_prc pcb Aaa mslr_lrq md B_lej_bcqf )ICA B*- rfc Cmkn_ lgcq Aar- 2;;5- rfc B_li Cmkn_ lgcq Aa r- 2 ;;2 _ q _kc lbcb gl 3124 _lb rfc Sc aspgrgcq _ lb Evaf_lec Rsjcq- 2 ;98/ Tfc _a amslrgle nmjgagc q sq cb gl rfc npc n_ p_rgml md dgl_lag_j q r_rckc lrq _ pc _ nnpmnpg_rc _lb _pc amlqgqrclrjw sqc b `w rfc epmsn/ A jj k_rcpg_j bc n_ prspc q )gd _ lw* f_tc `cc l bgqajmqcb _lb cv nj_ glcb gl rfc lmrcq rm rfc dgl_ la g_ j qr_rc. kclrq/ Tfcpc _pc lm bcn_prspc q dpmk rfc npc qapg`c b _aa mslrgle q r_lb_pbq/ Cmkn_ p_ rgtc gld mpk_rgml f_q `c cl pc aj_qqgdgcb ufcpctcp lcac qq_pw rm amknjw ugrf rfc asppclr wc _p#q npc qclr_rgml/ Tfc _ sbgr amkkgrrcc md rfc B_li kcc rq ncpgmbga_ jjw ugrf rfc glrcpl_ j _ sbgr rc_ k rm pc tgc u rfcgp _ sbgr nj_lq_qqc qq rfc gp pc qnmlqg`gjgrgc...
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...On Accounting Flows and Systematic Risk Neil Garrod University of Glasgow Dusan Mramor University of Ljubljana Address for correspondence: Neil Garrod, Department of Accounting and Finance, University of Glasgow, 65-71, Southpark Avenue, Glasgow G12 8LE, Scotland, U.K. Tel: 00-44-141-330-5426 e-mail: n.garrod@accfin.gla.ac.uk On Accounting Flows and Systematic Risk Abstract The body of work that relates accounting numbers to market measures of systematic equity risk was largely undertaken in the 1970s and early 1980s. More recent proposals on changes in accounting disclosure of risk mean that a rigorous theoretical model of the relationship between accounting measures and market measures of risk is timely. In this paper such a model is developed. In addition, the assumptions required to develop the model are explicitly identified. By so doing it becomes possible to identify the potential cross-sectional differences which drive the empirical relationship between accounting and market based measures of risk. The model developed highlights a clear relationship between accounting and market measures of risk which can be exploited in situations where accounting data alone is available. It also provides a framework within which the environmental factors leading to cross-sectional differences between companies can be further explored. On Accounting Flows and Systematic...
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...The codes of ethics for both associations complement each other in several ways. The first way in which the complement each other is through confidentiality. Both handle confidential in similar ways, the Institute of Internal Auditors code states that auditors will keep all information confidential unless there is a professional or legal obligation to otherwise disclose the information. The Association of Certified Fraud Examiners code states that examiners will not disclose confidential information without the proper authorizations to do so. A second way the codes complement each other is through competence. Both the Institute of Internal Auditors and The Association of Certified Fraud Examiners state that they will continue to increase the competency of their members. Other ways in which they complement each other, both declare their allegiance to integrity, professionalism, and to maintain both ethical and legal conduct. The codes of ethics are essentially the same for each organization, all though the wording is a bit different between the two codes. Standards are important in both fields, so that auditors and fraud examiners have a uniform and legal approach to handle the risks inherent in organizations. Standards are important for fraud examiners so that they have uniform way of obtaining documentary evidence, interviewing witnesses and potential suspects, writing investigative reports, testifying to findings, and assisting in the general detection and prevention...
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...sheet provided by Mr. Sheehan have a few questionable points: a. Net Sales – even though the forecast numbers are based on the typical seasonality of the firm’s sales performance of previous year. The forecast performances are much higher than the actual. b. Profit and retain earnings – closely relate to forecast, these forecast also inaccurate c. Inventory – with sales under perform, the inventory forecasts are also inaccurate. With much higher inventory than anticipated, especially in January 1991, the residual between actual and forecast is 924,000, which is a very big different. These excess inventories became illiquid assets, thus increased the liabilities which have a negative effect on the company’s financial health. Nevertheless, with lack of previous years’ financial data in addition to the unpredictable recession of the economy, it is hard to say whether or not these data were exaggerating. 2. Risk assessment a. Liquidity – as of March 1991, the current and cash ratio of Dynashears are 5.99 and 0.38, which are not bad numbers. The ratios shows that Dynashears’ current assets are still well cover (almost 6 to 1 ratio) over its increasing liabilities due to illiquid assets and that it still has sufficient cash for optimum operation. b. Long-term debt ratio – as of March 1991, the debt ratio is 4.71% which is very low, indicates that Dynashears still able to borrow a lot more. Even though Dynashears’ asset turnover rate is low (estimate at 0.24) and sales performance is...
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...with the problem of choosing from among a large number of securities. His choice depends upon the risk and return characteristics of individual securities. He would attempt to choose the most desirable securities and like to allocate is funds over this group of securities. Again he is faced with the problem of deciding which securities to hold and how much to invest in each. The investor faces an infinite number of possible portfolios or groups of securities. The risk and return characteristics of portfolio differ from those of individual securities combining to form a portfolio. The investor tries to choose the optimal portfolio taking in to consideration the risk return characteristics of all possible portfolios. As the economy and the financial environment keep changing the risk return characteristics of individual securities as well as portfolios also change. This calls for periodical review and revision of investment portfolios of investors. An investor invests his funds in a portfolio expecting to get a good return consistent with the risk that he has to bear. The return realized from the portfolio has to be measured and the performance of the portfolio has to be evaluated. It is evident that rational investment activity involves creation of an investment...
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...simple fundamental analysis strategy based on historical accounting information can predict stock returns. The paper’s goal is to show that simple screens based on historical financial signals can shift the distribution of returns earned by an investor by separating eventual winners stocks from losers. Results show that historical accounting signals can be used to improve the entire distribution of future returns earned by an investor. In fact, despite the overall down activity of the market over the sample period chosen, results reveal that fundamental accounting signals can be used to discriminate from an overall sample generating future negative returns of -0,116 a winner portfolio that provide positive future return of 0,019 from a loser one generating a negative return of -0,229. The over-performance of the winner portfolio seems to be attributable to the ability of the fundamental signals to predict future earnings. In fact, results show that fundamental signals have a positive and significant correlation with future earnings performance and that the winner portfolio have a future earning’s realisation (0,100) that outperforms that of the loser portfolio (-0,012). Keywords: Fundamental Analysis, Market Efficiency, Stock returns. JEL Classification Codes: G11, G14 1. Introduction One object of financial accounting is to provide information that is relevant to investment decisions. Discovering value-relevant accounting attributes has been the subject of numerous...
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...KOTA FIBRES What does the forecast show? Do you like how it is constructed? The company has projected gross sales to reach 90.9 million rupees in 2001, an forecasted growth of approximately 15 million rupees over the previous year. In spite of the large increase, there are several additional financial factors which need to be taken into account in evaluating the forecast. For instance, Total asset turnover gives an understanding of the efficiency with which the firm uses its assets to generate sales. Total Asset Turnover in this particular case is suboptimal at best. In 2000, Kota had a total asset turnover ratio of .18, with a ratio value of .17 in projected for 2001. This shows major inefficiencies in the management of assets by the company, as it only turns its assets over .18 times a year. They may want to increase this ratio number by increasing their amount of total assets. Kota Fibres as a company (as far as its financial statements are concerned) is very capable of satisfying its short-term obligations as they come due. With a current ratio of 3.24 and quick ratio of 2.38, Kota is operating within acceptable levels (acceptable values are 2.0 and 1.0, respectively). However, the forecasted ratio for 2001 shows that this ratio drops to 1.5:1, which is below the acceptable level of 2.0 set for a manufacturing firm. This means they will have some problem paying their bills on time with the projected production and sales levels. Kota Fibres, in 2000, had a quick ratio...
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...Arthur Anderson 1. Environment, strategic, organizational changes * High quality accounting, promoting integrity and sound audit opinions over short run profits * 1930’s- government adopted laws that require public companies to submit financial statements to independent auditor each year * mantra- good service, quality audits, well managed staff, profits for firm * auditors rewarded for making sound auditing decisions * decision rights to Professional Standards Group * firm did not become wealthy in the early years, partners were well respected in communities * 1950’s- Joseph Glickauf- computers to automate bookkeeping * 1979-42% of $645m fees came from consulting * 1989- split to AC and AA * accounting business grew slowly in 1990 due to increased competition and mergers * AA adopted new strategy of generating profits, “it was a matter of pride” * New rules- partners retired at 56, less experienced auditors and fewer partners overseeing audits * New breeds of partners- Samek, Allgyer, signing off on inaccurate financial statements * 1997- AC split completely and became Accenture, AA underwent setback when they didn't receive the $14b expected payment from AC * AA- 2X performance evaluation, relaxed dress code, wooden doors removed * New service- take over entire internal bookkeeping for clients- impaired quality of audits * Enron-1986, wholesale energy trading * Anderson hired Enron in 1990 * Speed...
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...Solutions: 1. A review is performed to obtain a reasonable basis for providing limited assurance that the client's financial statements have been prepared in conformity with generally accepted accounting principles. An independent audit is designed to provide a reasonable basis for expressing an opinion concerning whether or not a client’s financial statements have been prepared in accordance with generally accepted accounting principles. There is also a major difference between a review and an audit in terms of the scope of work performed. When a review is done, the main evidence collection techniques are analytical procedures and inquiries of client personnel. Whereas, in an audit, the full range of evidence collection techniques available to an auditor is likely to be used. A review does not assess control risk, tests of accounting records and responses to inquiries by obtaining validating evidence through inspection, observation or any other audit procedure. It can point out significant matters of the financial statements but does not provide assurance of their accuracy. Because reviews are generally not as rigorous as audits, considerably less evidence is typically collected in a review than in a comparable audit engagement. The issue with ZZZZ Best case is that the auditors review was not sufficient enough to review any material misstatements on the financial statements. 2. Third party confirmations should give consistent evidence in support of assertions made by...
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...About the Company Ratio Analysis Ratio Analysis involves methods of calculating and interpreting financial ratios to analyze and monitor the firm’s performance. The basic inputs to ratio analysis are the firm’s income statement and balance sheet. Financial ratios are designed to helps one evaluate a financial statements. (A) Liquidity Ratio: Liquidity Ratio measures a firm’s ability to satisfy its short term obligations as they come due. Bellow we have shown the liquidity ratio of the Confidence Cement. For the year 2002, 2003.2004.2005 & 2006. 1. Current Ratio: The current ratio is a widely used measure for calculating a company’s liquidity and short term debt paying ability. Generally, the higher the current ratio, the more liquid the firm is considered to be. The current ratio is sometimes referred to as the working capital ratio. The current ratio is only one measure of liquidity. Ratio Formula 2002 2003 2004 2005 2006 Current Ratio Current Asset Current Liabilities 1.45 times 1.21 times 1.09 times 1.12 times 1.17 times Interpretation Here we have calculated the current ratio of the Confidence Cement for 5 years. Here we considered current asset = Stores + book debits+ other transactions. And we considered current liabilities = creditors + proposed dividend + other accounts. Here we have seen that for Confidence Cement all the current ratios have the minimum ability to meet the short term obligations. Hopefully we see that from 2002...
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