...Joe Tagliaboschi EMBA 222 Managerial Accounting November 3, 2013 Assessing a Company’s Future Financial Health SciTronics is a medical device company. This financial evaluation will cover the period from 2005 through December 31, 2008. The evaluation will include a review of the profitability, use of assets, and financial leverage metrics. This company appears to be financially healthy and has shown improvement in many of the metrics reviewed. The company has little long term debt, and adequate cash and owners’ equity balances. However, there are also some metrics that reveal that without some additional adjustments, the growth experienced in the past may not be sustainable. This evaluation will answer the following questions as well. * What is the assessment of the performance of SciTronics during the 2005-2008 period? * Has the financial strength and its access to external sources of finance improved or weakened? * What are the 2-3 most important questions you would ask management as a result of the analysis To evaluate the company’s performance the following evaluation criteria will be used. * Has the overall profitability increased or decreased during the period? * How well does the company deploy its assets? * How sound is the company financing? Profitability How profitable is the company? The company profit continues to grow; the Return on Sales has improved by 2.3% over the 2005 period and there was sales...
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...9 -9 1 1 -4 1 2 REV: MAY 28, 2012 Assessing a Company’s Future Financial Health Assessing the long-term financial health of a company is an important task for management as it formulates goals and strategies and for outsiders as they consider the extension of credit, long-term supplier agreements, or an investment in a company’s equity. History abounds with examples of companies that embarked on overly ambitious programs and subsequently discovered that their portfolios of programs could not be financed on acceptable terms. The outcome was frequently the abandonment of programs mid-stream at considerable financial, organizational, and human cost. It is the responsibility of management to anticipate a future imbalance in the corporate financial system before its severity is reflected in the financials, and to consider corrective action before both time and money are exhausted. The avoidance of bankruptcy is an insufficient standard. Management must ensure the continuity of the flow of funds to all of its strategically important programs, even in periods of adversity. Figure A provides a conceptualization of the corporate financial system, with a suggested step-bystep process to assess whether it will remain in balance over the ensuing 3 to 5 years. The remainder of this note discusses each of the steps in the process and then provides an exercise on the various financial measures that are useful as part of the analysis. The final section of the note demonstrates ...
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...Dicci ionario Inglé – Español de Térmiinos Técnic de Direc és cos cción de Pro oyectos Diccion nario Ing glés – Es spañol de Términ Técn e nos nicos de Direcció de Pr ón royectos Ba asado en e PMBOK 4° Edición el K® Elab borado po or: Fech ha: Vers sión: Mario A. Santos, MSc, PMP. , Diciem mbre - 2010 0 1.0 o A. Santos | | TenStep Ecuador Mario Página 1 Diccionario Inglés – Español de Términos Técnicos de Dirección de Proyectos Índice 1. 2. Términos generales _________________________________________ 4 Estructuras organizacionales _________________________________ 5 3. Grupos de procesos de la Dirección de Proyectos, áreas de conocimiento y procesos ________________________________________ 6 4. Gestión de la Integración del Proyecto _________________________ 10 4.1. 4.2. 4.3. 4.4. 4.5. 4.6. Desarrollar el Acta de Constitución del Proyecto __________________ 11 Desarrollar el Plan para la Dirección del Proyecto _________________ 12 Dirigir y Gestionar la Ejecución del Proyecto _____________________ 13 Monitorear y Controlar el Trabajo del Proyecto ____________________ 14 Realizar el Control Integrado de Cambios ________________________ 15 Cerrar el Proyecto o Fase ______________________________________ 16 5. Gestión del Alcance del Proyecto _____________________________ 17 5.1. 5.2. 5.3. 5.4. 5.5. Recopilar Requisitos__________________________________________ 18 Definir el Alcance ____________________________________________ 19 Crear la...
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...preparation and completion of individual tax returns, corporations, partnerships, and sole proprietorships are expected to be finished in a timely manner. These are the primary means of income for this company, but I also prepare estate and trust returns when needed. Other duties and responsibilities assigned to me include the preparation and reconciliation of financial statements. I am responsible for creating and generating the general ledger, balance sheet, profit and loss, and payroll for all companies I work on. All of these financial statements have to be completed correctly and on time. I’m also in charge of the office filing system and reports. During the duration of my internship I had several special projects assigned to me. Since it is now tax season there is a lot of work to be done, it is our busiest time of the year. Instead of completing corporate returns like I normally do, I worked mostly on individual returns. There are several hundred individual returns to be completed so most of my efforts were directed and focused toward this. I would meet with several clients a day to review their financial situations and complete their tax return. Some of them were extremely easy to complete and I wouldn’t have to exert much effort. There were a few clients where I needed assistance from my employer to complete their returns. Sometimes individual returns can become very complicated. I remember working on...
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...Professor Thomas Piper prepared the original version of this note, “Assessing a Firm’s Future Financial Health,” HBS No. 201-077, which is being replaced by this version prepared by the same author. This note was prepared as the basis for class discussion. Copyright © 2010, 2011, 2012 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1- 800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to www.hbsp.harvard.edu/educators. This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School. Assessing a Company’s Future Financial Health Assessing the long-term financial health of a company is an important task for management as it formulates goals and strategies and for outsiders as they consider the extension of credit, long-term supplier agreements, or an investment in a company’s equity. History abounds with examples of companies that embarked on overly ambitious programs and subsequently discovered that their portfolios of programs could not be financed on acceptable terms. The outcome was frequently the abandonment of programs mid-stream at considerable financial, organizational, and human cost. It is the responsibility of management to anticipate a future imbalance in the corporate financial system before its severity is reflected in the financials, and to consider corrective action before both time and money...
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...the issues III. Recommendations with reasons IV. Executive Summary INTRODUCTION/ BACKGROUND What is the case about? In July 1994, the president of National Fabricators Inc Mr. Tom Kruger called his bank manager of the confederation Bank of Canada, Mr.Jim Kashmar to ask that the bank continue to extend a temporary line of credit of $ 1,000,000 for a period of sixty days. They needed this extension because there had been some delays in the collection of the company’s holdbacks for that period. After the sixty days they hoped to have collected their holdbacks and other receivables so they would return to their normal line of credit which was $800,00. In the month before however, national fabricators had asked for the same extension in credit as a result of delays in the collection of some payments for locker room installations done. The bank had reluctantly extended the credit on the basis of the confidence in the new president of the company, relations with client and the company’s impact on community. They however stated that, nothing in the application warranted the extension of further credit. As such this new appeal for an extension had to be very compelling. Background National fabricators was reorganised after Canadian Metal fabricators’ ltd, a family business whose shareholders gave up on and resulted in the company going bankrupt. Mr Kruger bought a substantial amount of shares with his savings from shareholders and assumed the position of...
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...INTERNATIONAL JOURNAL OF MANAGEMENT, BUSINESS, AND ADMINISTRATION VOLUME 8, NUMBER 1, 2005 Assessing A Firm’s Future Financial Health Alicia Kritsonis MBA Graduate Student California State University, Dominquez Hills ABSTRACT The purpose of this article is to explain a step-by-step process that can assess whether a firm will remain in balance over the next two to three years. Various financial ratios will be discussed as a critical aspect of this process analysis. A case study of assessing the future health of the Harley Davidson, Inc. using a ratio analysis is included in the article to explain the step-by-step process used by managers to ensure a firm’s success. A great analogy comes to mind when considering the effects of assessing your firm’s future health. It is helpful to think of your firm as a three-legged stool. The legs are operations, marketing, and finance/accounting. As you, the leader, try to sit atop the stool, it must be balanced so that you can shift your position and sit comfortably. However, if one of the legs of the stool is too short or too long, then the stool is difficult to manage and unstable (http://www.thefullermangroup.com). Here is an example of an unbalanced firm. A firm borrows cash in order to expand its facility and operating capacity. However, sales remain constant resulting in a cash shortage. Consequently, the increased overhead costs diminish the working capital. Purchase discounts are missed resulting in decreased margins. The...
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...Osterwalder & Yves Pigneur, 2010. Available @ http://www.businessmodelgeneration.com/downloads/businessmodelgeneration_preview.pdf | Operating and Investing Decisions: Business Model Canvas Building Blocks | May 8th Lecture AL 116 [6:00 – 6:50PM]Topic: Why AFM 211? Why Week 3 exam? | May 12 – 16 | * Read: Strategy and Your Stronger Hand,” Geoffrey A. Moore, Harvard Business Review, December 2005. Available for free through UW library’s Business Source Complete electronic database. See LEARN for instructions. * Read: “Assessing a Company’s Future Financial Health,” Thomas Piper, Harvard Business School, May 2012. Available in AFM 211 Courseware Package; AND, * Complete ratio analysis for SciTronics in “Assessing a Company’s Future Financial Health” on pages 6-10 and use that analysis to answer questions 1 and 3 framed as “broad questions” at the top of page 6. * Try the “Case of the Unidentified Industries” in “Assessing a Company’s Future Financial Health” on page 11 and Exhibit 3. | Operating and Investing Decisions: Value Chain, Profit Model, and Profit Driver Analysis | May 15th Lecture AL 116 [6:00 – 6:50PM]Topic: Relevant – It Depends. On what? | May 19 – 23 | * Complete Online Module # 1 – Learning with Cases | No face-to-face class [Note: allocate your class and prep time to complete Online Module # 1] | May 22nd AFM 211 Exam # 1 [7:00 – 9:00PM]Location TBAExam # 1: Exercises. Document Business Model Canvas; Ratio Analysis; Identifying Unidentified Companies...
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...Onesteel’s sustainability report 5 • Conclusion 6 • Recommendation 6 • Reference 8 Executive summary The purpose of this paper was to explain the reasons for which companies started to produce non-financial report and figure out the key features of sustainability report, and then evaluate the sustainability report of Onesteel in relation of the key features. This essay is based on academic journals and professional business websites, as well as information sourced from company’s sustainability report for the year of 2011. The paper discussed the key features of sustainability report mainly by the global reporting initiative sustainability reporting guidelines, such as the six principles (balance, comparability, accuracy, timeliness, clarity and reliability) and the core indicators (environmental factors, human rights, labor practices and decent work, society, product responsibility and economic factors). In conclusion, the company of Onesteel is a leading one of mining industry, it had done well in sustainability report according to the key features of sustainability report. However, Onesteel should include the information about opportunities and predictions for future in order to make the sustainability report more completed, besides this, Onesteel should turn some information stated by words into numbers so that it can be easier for stakeholders to read and use the report. Introduction With the rise of environmental...
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...INTERNATIONAL JOURNAL OF SCHOLARLY ACADEMIC INTELLECTUAL DIVERSITY VOLUME 8, NUMBER 1 2004-2005 Assessing A Firm’s Future Financial Health Alicia Kritsonis MBA Graduate Student California State University, Dominquez Hills ABSTRACT The purpose of this article is to explain a step-by-step process that can assess whether a firm will remain in balance over the next two to three years. Various financial ratios will be discussed as a critical aspect of this process analysis. A case study of assessing the future health of the Harley Davidson, Inc. using a ratio analysis is included in the article to explain the step-by-step process used by managers to ensure a firm’s success. A great analogy comes to mind when considering the effects of assessing your firm’s future health. It is helpful to think of your firm as a three-legged stool. The legs are operations, marketing, and finance/accounting. As you, the leader, try to sit atop the stool, it must be balanced so that you can shift your position and sit comfortably. However, if one of the legs of the stool is too short or too long, then the stool is difficult to manage and unstable (http://www.thefullermangroup.com). Here is an example of an unbalanced firm. A firm borrows cash in order to expand its facility and operating capacity. However, sales remain constant resulting in a cash shortage. Consequently, the increased overhead costs diminish the working capital. Purchase discounts are missed resulting in decreased margins...
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...Financial Statements Paper Teya Crawford ACC/280 Nov, 7 2011 Pamela Zanzucchi Financial Statements Paper Accounting is part of an organization that enables companies to analyze, record, and retrieve critical financial information that is used to determine a company's financial status. The purpose of accounting is to assist people with understanding the financial status of an organization and to provide the financial reports and insights needed to make sound decisions. It is important to effectively communicate this information in order for the business to be successful. There are four financial statements that are used to record information. They include: Income Statement, Balance Sheet, Retained Earnings Statement or Shareholders Equity Statement, and Statement of Cash Flows. Financial Statements Financial statements are reports that reveal where the money is stores, where it is taken from, where it goes, and where it is now. The four statements mentioned earlier: Balance Sheets, Income Statements, Cash Flow Statements, and Statements of Shareholder’s Equity, will be found in the Security and Exchange Commission (SEC) as a public record, if the organization is public. Private businesses will send those reports to stockholders such as owners and lenders of that business. The purpose of the Financial Statements is to give the people information about a company’s financial position and performance. They need to be relevant, reliable, understandable, and comparable...
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...Assessing a Company’s Future Financial Health SciTronics Inc. Case #1 Prepared by James Elias Prepared For Babak Lotfaliei Fin 423 MW: 10:00 AM- 11:50 AM 02/11/2015 Table of Contents Company Overview and Analysis Objective 1 Assessing the Company’s Profits and Sales Growth 1-2 Assessing the Company’s Use of Assets 2-3 Determining Solvency and Liquidity 3-4 Matching Companies Exercise 5 Appendix 6-14 Company Overview and Analysis Objective SciTronics is a company that operates in the medical device industry; they sell to hospitals and other medical centers with the goal of manufacturing and supplying quality goods. Being in the medical market from 2005-2008, SciTronics has been forced to keep up with an ever-changing and highly competitive industry. For this reason I found it necessary to conduct an assessment of the company’s past and present performance. Our group’s objective was to assess the overall health and financial stability of SciTronics incorporated, to achieve this I implemented the Corporate Financial System Framework (See Appendix I) and calculated four groups of ratios: Profitability, Asset Management, Leverage and Liquidity. Assessing the Company’s Profits and Sales Growth First and foremost I looked at the company’s profitability ratios starting with sales growth from 2005-2008 (See Appendix D). Knowing how well the medical industry did during this period of time, it wasn’t a surprise...
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...TABLE OF CONTENTS Income Statement Income Statement Analysis Balance Sheet Statement of Cash Flows Cash Flow Analysis Financial Ratios Income statement Income Statement Common size PepsiCo Inc., Common-Size Consolidated Income Statement | | | | | | | Dec 31, 2011 | Dec 25, 2010 | Dec 26,2009 | Gross profit | 52.49% | 54.05% | 53.51% | Operating profit margin | 13.28% | 14.23% | 18.69% | Net profit margin | 9.69% | 10.93% | 13.75% | Net Sale Change 2011-2010 2010-2009 14.98% 33.79% S & A Margin 2011 2010 2009 37.81% 39.44% 34.76% ANAYLIS Pepsi Co Gross Profit Margin increased from 2009 to 2010 but had deterioration in 2011. Pepsi Co had deteriorating numbers from 2009 to 2011 in operating profit margin. Pepsi Co had deterioration from 2009 to 20011 in Net profit margin. Pepsi Co Net sale change is from 2011-2010 is 14.98% and from 2010-2009 33.79%. -CFO is positive all three years. CFO also increased in years 2009, 2010 and 2011. -Pepsi Co is profitable each year. Pepsi Co net income increased in years 209, 2010 and 2011. -Account receivables decreased in 2009, 2010 and 2011. -Net earnings increased all three years from 2009-2011 -Inventories increased from 2009 to 2010 but decreased from 2010 to 2011 -NOTE In 2010 and in 2009 Pepsi Co invested money into pension and retirement funds -CFI activities were negative in all 3 years. -Pepsi Co is investing in property...
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...Going Concern Group 4 ACCT 632, Advanced Financial Acct Theory Liberty University Aug 7, 2013 GOING CONCERN Summary of Going Concern current exposure draft Comparison and Contrast of current Going Concern theory and standards 1 Guidance provided by AU Section 341 2 Guidance provided by 17 U.S.C. §229.303 3 Proposed guidance of exposure draft Comparison and Contrast of U. S. GAAP and IFRS with respect to Going Concern 1 Current Going Concern variations between U. S. GAAP and IFRS 2 Variations between proposed changes to Going Concern issues The Benefits and Costs of a Going Concern Amendment 1 Providing preparer guidance 2 Making management responsible 3 Addressing investor concerns Provisions in light of the FASB’s Conceptual Framework 1 Understandability 2 Decision usefulness 3 Relevance 4 Comparability Response to Going Concern Exposure Draft 1 Proposed changes or corrections to the current exposure draft References Going Concern People go into business for many reasons, but no one goes into business with the expectation that they are not going to be successful. For that reason, acquisition is made for those assets that are needed to run the company with the understanding that there will be no need to arrange for early liquidation. Because there is no prediction to inform someone that their business may or may not make it, managers must rely...
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...Financial analysis (also referred to as financial statement analysis or accounting analysis or Analysis of finance) refers to an assessment of the viability, stability and profitability of a business, sub-business or project. It is performed by professionals who prepare reports using ratios that make use of information taken from financial statements and other reports. These reports are usually presented to top management as one of their bases in making business decisions. Financial analysis may determine if a business will: Continue or discontinue its main operation or part of its business; Make or purchase certain materials in the manufacture of its product; Acquire or rent/lease certain machineries and equipment in the production of its goods; Issue stocks or negotiate for a bank loan to increase its working capital; Make decisions regarding investing or lending capital; Make other decisions that allow management to make an informed selection on various alternatives in the conduct of its business. Contents [hide] 1 Goals 2 Method 3 See also 4 Notes 5 External links Goals[edit] Financial analysts often assess the following elements of a firm: 1. Profitability - its ability to earn income and sustain growth in both the short- and long-term. A company's degree of profitability is usually based on the income statement, which reports on the company's results of operations; 2. Solvency - its ability to pay its obligation to creditors and other third parties in...
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