I need an explanation for this Accounting question to help me study.
Using your WEB browser, each team member should access the annual report or 10-K for one publicly traded company in the industry (Qualcom).
1. On an individual basis, each team member should write a short report (not to exceed 4 pages) that incorporates the following: (Note: EACH GROUP NEEDS TO INCLUDE ONE INTERNATIONAL FIRM THAT FILES THEIR REPORTS UNDER IFRS).
- a)List and discuss one significant accounting policy (revenue recognition, inventory accounting, fixed asset accounting, goodwill, fair value accounting (if your footnotes have a fair value disclosure I expect to see that one included too) or any other such significant disclosure found in the footnotes). Please be sure to evaluate whether you believe the policy seems fair compared to the other companies your team has examined (include this evaluation in part 2 below; although your accounting policy summary should be in the individual report alone).
- b)Calculate the debt-to-asset ratio at the end of the current and prior years, and explain any change between the two years.
- c)Calculate the current ratio and working capital ratios at the end of the current and prior years, and explain any change between the two years.
- d)Calculate the total asset turnover ratio (and its components: accounts receivable turnover, inventory turnover, and fixed asset turnover). Please use averages forall calculations just like we did in virtual class.
- e)Calculate the gross profit margin, operating profit margin, net profit margin (a/k/a net income, or net earnings) of the current and prior years and explain any changes between the two years.
- f)Calculate the Return on Assets (adjusted with interest expense add back), Return on Equity, Return on Common Equity and Return on Net Operating Assets (RNOA) for the current and prior years and explain any changes between the two years. A 5-way ROE decomposition would be useful too if your group feels it is additive or explains things better.
- g)g. Be sure to include industry benchmarks, where available for your ratios above. You can include them in your synthesized group reports if that is easier, or you can have them in the individual and group reports. You can find industry ratios at: Dun&Bradstreet Industry Norms and Trends (Library dome resources online), Bloomburg laboratory, Hovers, or finance websites that contain such data. Just be sure to cite your industry sources.
- Then, as a team (no more than 6 members per team), write a short report (no more than 10 pages) comparing and contrasting your companies using these attributes. Discuss any patterns across the companies that you observe as a team. Provide explanations for any differences discovered.
- PREPARE A 15-20 minute powerpoint presentation on your research reports. The presentation should cover the necessary steps required to do a substantial financial statement analysis. You can go industry/firm/ratio grouping for all firms OR/ Individual Firm/industry/ratio groupings for individual firm 1, firm 2 etc. How you present should be based on the story you’re telling NOT WHAT YOU THINK MY PREFERENCE IS.
- Please use times new roman, 12 point font with double spacing.
- Please cite/reference any outside sources in your bibliography.
- Please put a cover page and list all team members’ names.
- Attach and an addendum the individual reports (which should not exceed 3 pages per person). Please make sure to identify whose report it is (put a name on each individual report).
- You will have to synthesize the individual reports to get it down the page requirement for the group report.
- The group report will be worth 100 points (25% of final grade) and all members will receive the same grade. The individual report is worth 50 points (10 % of final grade).
- The final written reports are due on July 6, 2020 the last class and I will only electronic copies of the final written reports submitted via Turnitin on blackboard assignments tab. Please make sure that they’re professionally assembled and that they’re self-contained documents. Quality checks should be pervasive in your group dynamics. ONLY UPLOAD ONE PDF (COMBINED REPORT TO TURNITIN).
Each report will be evaluated on its own merits. Organization, clarity and responsiveness to the requirements will be heavily weighted. I am looking for you to show me what you have learnt not what you have memorized. So, please make sure your reports have a unique, demonstrative and purposeful flow to them. Use of a few graphs (data visualization techniques: heat maps, bubble graphs, radar/spider graphs (excel)) would be useful to include. Please do not speak to other groups about the Content and formatting of your reports, I expect to see variety. Most importantly, have fun and continue learning.