...Financial Analysis Phillips 66 Toccara Smalls Atlanta intercontinental university BUSN 125- Business Math September 3, 2015 Abstract This paper is an analysis of the financial statement of Phillips 66. The researcher will present horizontal and vertical analysis of the income statement and balance sheet among other things. Introduction This paper presents an analysis of Phillips 66 financial statement. Specifically discussed in this document will be the following: Preparation of Financial Statement, Business Problem Solving, Recovery Methods, Indebtedness, Horizontal Analysis, Vertical Analysis, and Ratios and Percentages. The document will conclude with a summary of this discussion. Preparation of Financial Statement Financial statements will give you a clear and accurate visual of how your business is currently performing, so you have a means of monitoring its progress and identifying opportunities for growth. The type of financial statement that lays out the basis for a fortune 500 company like Phillips 66 include a thrall preparation of the balance sheet, income statement, statement of retained earnings, and statement of cash flows; which are the most important steps in the accounting cycle because it represents the purpose of financial accounting statement (Brook, 2013). Ideally the financial statements are prepared by transferring the account balances on the adjusted trial balance to a set of financial statement templates in order to establish a logistical...
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...prospective analysis method and the market valuation model to discuss the firm value. For financial market and the firm value analysis, valuation is the estimate process to the business and stock values. Considering the normal financial statement and accounting strategies of the assignment firm, the valuation is necessary to support the shareholders and investors in their buy and sell decisions. 2. Prospective Analysis From the financial report of the firm, we could make a respective method to analysis the firm value to the shareholder and the investors. Based on the historical accounting data, we can forecast some main quotas of the firm value as following charts. The forecast of the major incomes and ratio could be described in the 2-1-1 forecast analysis chart. 2-1 Forecast Analysis We can adopt the residual income valuation model to easily reflect the stock price and prospective firm earning as the following equation: St=BSt+(NIt+1-(k*BSt))/(1+k)+ (NIt+2-(k*BSt+1))/(1+k)2+…. Whereas variable St is the book value of this firm in period time t, variable NIt+n is the firm net income value in the period time t+n, the cost of capital variable factor is k, and the residual in the time t refers to the difference of the comprehensive net income and the beginning book value, which could be described as RIt =NIt -(k*BSt-1). The detailed residual income model could be described in chart 2-2. 2-1-2 residual income valuation model Sensitive analysis which means the analysis model...
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...Ratio and Financial Statements Analysis Kimberly Y. Gruber University of Maryland University College Dr. Sunando Sengupta 07/25/2013 Turnitin Score: 23% Executive Summary The purpose of this paper is to examine ratio and financial statement analysis. Such analysis is a useful tool for managers and stakeholders to evaluate a company’s financial health in order to identify opportunities for growth and areas of weakness so as to institute corrective measures. Financial statements are used in order to predict trends of cash flow within the business as well as predict the potential of a business and if they are capable of financial growth. Ratio analysis examines the probability of a company’s profit or a company’s loss. This paper will examine the benefits and limitations of ratio analysis, explain what factors impact the meaningfulness of such measures and what new practices or theories may be emerging regarding the application of ratio and financial statement. The paper concludes that ratio and financial statements is an essential tool used in analyzing a company’s profit. Introduction to Ratio and Financial Statement Analysis Though there are various methods for monitoring the liquidity of businesses the most common has been the use of financial ratios. Ratio analysis is an established technique—involving the relationship between two or more variables--that is used to conduct qualitative analysis of information contained in a company’s financial statement to...
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...FINANCIAL PERFORMANCE REVIEW AND ESTIMATING COMPANY VALUE OF PT ANEKA TAMBANG (PERSERO) TBK IN COMPARISON WITH OTHER LOCAL MINING COMPANY: PT VALE INDONESIA TBK Muhammad Naufal Aflah and Ana Noveria School of Business and Management Institut Teknologi Bandung, Indonesia naufal.aflah@sbm-itb.ac.id Abstract: The researcher will try to analyze about the past, current, and future financial condition and make a valuation about firm’s value of two companies that dominate the mining sector of industry in Indonesia which are PT Aneka Tambang (Persero) Tbk (ANTAM) and PT Vale Indonesia Tbk, formerly PT International Nickel Indonesia Tbk (VALE). To assess the financial performance of PT Aneka Tambang (Persero) Tbk, researcher will use several methods which are time-series analysis (Compound Annual Growth Rate), cross-section analysis, common-size analysis, and DuPont Analysis (ROA and ROE). Then make a valuation of the firm’s value using three valuation approach which are asset based method, market approach, and income approach better known as discounted cash flow approach. Based on the results, ANTAM has better performance in their net working capital through total current assets, current liabilities, retained earnings, and share capital. Nevertheless, VALE has good capability in attract the investors and controlling their non-current assets, non-current liabilities, and additional paid in capital. In overall, ANTAM has better financial performance than VALE in terms of CAGR comparison...
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...ACC 410 Assignment 1 Financial Statement / Audit Report Review Follow Below Link to Download Tutorial https://homeworklance.com/downloads/acc-410-assignment-1-financial-statement-audit-report-review/ For More Information Visit Our Website ( https://homeworklance.com/ ) Email us At: Support@homeworklance.com or lancehomework@gmail.com Assignment 1: Financial Statement / Audit Report Review Due Week 4 and worth 240 points Select one (1) local government in your state or area and review the financial statements and audit report for the county or municipality. The financial statements of the government you selected should have at least three (3) funds. Refer to the continuing problem homework for Weeks 1 through 3 for this assignment. Write a three to five (3-5) page paper in which you: 1.Compare and contrast the comprehensive annual financial report (CAFR) of the selected local government entity with the city of Austin report from Week 1 homework. In your comparison, include: a.Publication method of the CAFR b.Audit and budget information in the CAFR c.The type of audit report issued d.Existence or non-existence of an internal audit function within the government entity 2.Prepare the analysis for the selected local government entity, including information on the introduction, financial section, and statistical section prepared in the city of Austin’s CAFR from chapter 2. 3.Analyze the methods used by the selected local government entity in comparing...
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...EBMA Level 8 Diploma in strategic Business Research and Leadership Direction Unit Title: Strategic Financial Analysis and Planning Table of Contents Executive Summary 3 1.Critique and evaluate research ....... 4 2.Critically apply modern financial tools 6 3.Use main types of investment appraisal tools 8 4.Critically evaluate the importance of research 10 References 11 Executive Summary The decision making of management is very crucial and involves various analysis to be performed. There are various ratios and methods that can be useful for mitigating the risks and increasing the expected returns with investments. The financial forecast is a mix of the behaviour, perception of management alongwith various techniques used for analysis of the different options available. Critique and evaluate research in financial theory and apply that research for decision making process 1.1 Describe the economic theory of choice as an illustration under certainty. The rational behind the economic theory of choice is to choose out of certain economic outcomes and representing the preferences through maximisation of the utility function of the outcomes. As per the von Neumann-Morgenstern expected utility model (1953), which is the workhorse of recent economics, the choices are made by people, so as to get the maximum utility. These preferences are based on intuition, self interest, past experiences etc...
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...This report provides a business analysis and valuation method of Genting Malaysia Berhad, a multinational corporation headquartered in Malaysia. The company is primarily involved in leisure and hospitality business, provides gaming, hotels, entertainment & amusement. Method of analysis included strategy analysis, accounting analysis, financial analysis and prospective analysis. PEST (Political, Economic, Social and/or Technological factors) analysis and Porter’s five forces analysis are used to analyze Genting’s economic and industry influences factors. Berjaya Toto is identified as the domestic competitor for Genting, solely in gambling business. The financial analysis report is based on 3 years Financial Statements of Genting Malaysia Berhad (on FY2012, FY2013 and FY2014) compared with Berjaya Toto’s Financial Statement. On accounting analysis, 5 significant accounting policies were identified. Genting and Berjaya Toto showed similarly on their accounting policies, particularly in Basis of Consolidation, Judgements and estimation, Property, Plant and Equipment (PPE), Depreciation and Revenue recognition. Income Statement Analysis, Balance Sheet Analysis and Cash Flow Analysis are attached in the appendices. On Financial Analysis, ratios of operating management, investment management and profitability, and financial leverage and liquidity are analyzed. Methods of analysis include time series analysis and cross-sectional analysis. Calculation on margin ratios,...
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...Accredited Tertiary Courses Listing 2012 Accredited Tertiary Courses Listing 2012 – as at 26 September 2012 1 2012 Accredited Undergraduate Courses AUSTRALIAN CAPITAL TERRITORY The Australian National University University of Canberra NEW SOUTH WALES Australian Catholic University Australian Institute of Higher Education Avondale College Charles Sturt University Kings Own Institute Macquarie University Southern Cross University Top Education Institute The University of New England The University of New South Wales The University of Newcastle The University of Sydney University of Technology, Sydney University of Western Sydney University of Wollongong Williams Business College NORTHERN TERRITORY Charles Darwin University QUEENSLAND Australian Catholic University Bond University Central Queensland University Christian Heritage College Griffith University James Cook University Queensland University of Technology The University of Queensland The University of Southern Queensland University of the Sunshine Coast SOUTH AUSTRALIA Flinders University Kaplan Business School The University of Adelaide University of South Australia Open Universities (conferred by Uni of SA) TASMANIA University of Tasmania VICTORIA Australian Catholic University Cambridge International College Carrick Higher Education Deakin University Holmes Institute Holmesglen Institute of TAFE La Trobe University Melbourne Institute of Technology Monash University Northern Melbourne Institute of TAFE RMIT...
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...Companies prepare the statement of cash flows differently from the three other basic financial statements. First, it is not prepared from an adjusted trial balance. It requires detailed information concerning the changes in account balances that occurred between two periods. An adjusted trial balance will not provide the necessary data. Second, the statement of cash flows deals with cash receipts and payments. As a result, the company must adjust the effects of the use of accrual accounting to determine cash flows. The information to prepare this statement usually comes from three sources: • Comparative balance sheets, indicates the amount of the changes in assets, liabilities, and stockholders’ equities from the beginning to the end of the period. • Current income statement, helps determine the amount of cash provided or used by operations during the period. • Additional information, includes transaction data needed to determine how cash was provided or used during the period. (Kimmel, P.D. Weygand, J.J. & Kieso, D.E., 2009) A company must convert net income from an accrual basis to a cash basis. The indirect method adjusts net income for items that do not affect cash. Companies favor the indirect method for two reasons: (1) It is easier and less costly to prepare, and (2) it focuses on the differences between net income and net cash flow from operating activities. The direct method shows operating cash receipts and payments, making it more consistent with the objective...
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...Analysis of Financial Statements of Coca Cola [Name of the Writer] [Name of the Institution] Table of Contents Introduction 2 Introduction of Company 2 Discussion 3 Analysis of Balance Sheet 3 Defined Contribution Plan 4 Basic and Dilutive EPS 4 Share-Based Compensation 5 Analysis of Cash Flow Statement 6 Conclusion 7 Works Cited 8 Analysis of Financial Statements of Coca Cola Introduction The subject, Analysis of Financial Statements is very important in many ways. It helps us to develop certain techniques about the analysis of financial statements of companies. Investors can use these techniques to identify certain trends and can manage their investments. This analysis is based on the financial statements of Coca Cola. It is a beverages company with operations in many parts of the world. This analysis will help the readers to get insight to this company. This analysis will cover all fundamental financial statements of Coca Cola. It will start with the analysis of the balance sheet items and will conclude with cash flow statement. The analysis will cover all the necessary aspects needed to draw ingenious results. Introduction of Company Coca Cola first started in 1886, in Atlanta. Johan Pemberton, a pharmacist introduced this drink and was later named as Coca-Cola. The sale of Coca Cola stated through Jacob’s pharmacy with 5 cent a glass. They sold only nine glasses a day. From then...
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...“A financial statement is the primary means of communicating the financial information of an organization to its external users” (Edmunds, 2010). They show recordings of obligations and are used for making decisions. The purpose of the analysis is to determine the meaning and significance of the data contained. As stated in the text, there are three different methods that is used for examining financial statements. They are horizontal analysis, vertical analysis, and ratio analysis. Horizontal analysis is one of the most common used techniques to analyze financial statements. The changes from period to period or year to year and over time are observed by absolute amounts or percentages. “Percentage uses the formula (subsequent year – previous year / previous year) * 100” (Zelman, McCue & Glick, 2009). Horizontal analysis is done for the income statement and the balance sheets. Using horizontal analysis is important. It states the facts very simple and makes analyzing more simple. “Vertical analysis uses percentages to compare individual components of financial statements to a key statement figure” (Edmunds, 2010). It analyzes the income statement and the balance sheet. It is also a common used method but it’s used more frequently to monitor annual changes. A benefit of vertical analysis is the ability to evaluate comparisons. The formula used for this analysis is “(line item of interest / base line item) * 100” (Zelman, McCue & Glick, 2009). Ratio analysis is the studying of...
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...Q1-1) Discuss four different methods of valuation, with a focus on their advantages and limitations. Answer: There are several methods of valuations, below are just a few: Discounted cash flow analysis (DCF) – this is considered one of the most thorough methods to value a company due to the fact that relies on free cash flows. There are two ways using the DCF method one, using the adjusted present value or the weighted average cost of capital, which shows a company how much capital is required for future income flow. Using this method gives us a more realistic thing to an intrinsic stock value, ratios may not give investors a clear value if the market is over/under valued. Some disadvantages would be that it’s based on future projections and assumptions if analysis do not have the abilities to make confident and sound future projection then this method could lead to disastrous future results. This method also viewed as a moving target and only for short term investing, requiring constant analysis and modifications. Comparable Transaction Method – this method focuses on analyzing similar transactions in the past and the market values that are similar to the company that is being purchased or looking at being purchased. Companies can look at several transactions of similar companies to help them determine a value. This value is real data and not based on future projections. Some disadvantages of this method would be the lack of financial data among private companies and past...
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...stock) | * Retained Earnings | (Accumulated net income that has not been distributed as dividends) | * Dividends | (Amount distributed to stockholders) | 4. Revenue accounts Examples: * Sales | (Amount earned from selling goods to customers) | * Service Revenue | (Amount earned from providing services to clients) | 5. Expense accounts. Examples: * Salaries Expense | (Amount earned by employees for work already done) | * Advertising Expense | (Cost incurred for advertising, promotions, and other marketing activites) | Annual Report: An annual report, a document issued by management to the shareholders of a company, presents financial information and results of operations for the past fiscal year. The annual report includes financial...
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...INTERMEDIATE (FINANCIAL) ACCOUNTING I SUBCLASS KLM CASE ANALYSIS QUESTIONS CASE 1 – REVENUE RECOGNITION AND EARNINGS MANAGEMENT INTERMEDIATE (FINANCIAL) ACCOUNTING I SUBCLASS KLM CASE ANALYSIS QUESTIONS CASE 2 – REVENUE RECOGNITION FOR A CONSTRUCTION PROJECT HKU Technology Inc. (Hereafter, HKU Tech) is a large construction contracting firm that serves a variety of industrial customers that purchase machinery and equipment from HKU Tech. HKU Tech’s business primarily involves the design and manufacture of large, industrial machinery and tooling that is used by its customers in manufacturing parts and components for fighter jets, transport planes, and other aerospace-related machinery and equipment. All of HKU Tech’s construction contracts involve the design, development, and manufacture of machines that are unique and customized to the specifications of its customers. HKU Tech negotiates all its contracts with its customers on either a fixed-price or cost-plus basis. HKU Tech has developed an accounting policy to recognize revenue related to its customized construction contracts, which is outlined as follows: The Company performs under a variety of contracts, some of which provide for reimbursement of cost plus fees, and others that are fixed-price-type contracts. Revenues and fees on these contracts are primarily recognized on a contract-by-contract basis using the percentage-ofcompletion method of accounting, which is most often based on contract costs incurred to date compared...
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...Relationship between corporate financial analysis and financial risk Any business will face some financial risk, its objective, not the people's will. However, if the business through good financial analysis, financial risk can be effectively prevented and controlled. In this regard, companies should focus on strengthening the financial analysis of the financial risks of business operations in a variety of financial risks for timely prediction and prevention, so as to improve economic efficiency of enterprises. Based on this, we have launched some discussion, want to contribute to a certain extent, corporate financial risk prevention. First, the financial analysis of the current Chinese enterprises widely used (A) comparative analysis Comparative analysis, as the name suggests, is to more than one set, or a set of comparative data or index, pairwise comparison, analysis, study, to determine the actual operating current business situation of enterprises and financial risks. Normally enterprises in comparison, and more is the issue and planned, the current number and the number of installments, business data and industry data, the actual number of the department and other departments and other indicators of the actual number of comparisons and analysis. (B) the structure analysis Structure analysis method refers to a particular financial indicators seen a whole, with its data as a part of the molecule, divided by the overall financial indicators to calculate the ratio...
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