Final Project Overview-
According to the AICPA (American Institute of Certified Public Accountants), a CPA in today's environment must not only have a high level of technical competence and a sense of commitment to service, but must also have good communications and analytical skills and the ability to work well with people. Employers are looking for individuals who have the ability to analyze and evaluate complex business problems and the interpersonal skills and maturity to make decisions in a client and customer service environment.
By continuing to use the company that you adopted in ACC 610, you will apply the technical competence and other skills required by today's CPAs. Through case study analysis, you will develop skills such as communication, presentation, and interpersonal relations in conjunction with technical accounting knowledge. If you have transferred directly into ACC 620 and have not had the opportunity to choose a company, you will do so at this time. You will also use this company in ACC 630. Throughout ACC 620 and ACC 630, you will apply the concepts you are learning using the financial data and business scenarios of a prominent retail company. You may choose from Wal-Mart, Target, Sears, Kroger, or Amazon.
ACC 620: Financial Reporting II is a continuation of ACC 610. In ACC 620, your focus in the final project will be on developing skills in critical thinking and applying accounting theories and practices according to generally accepted accounting principles (GAAP). You will be analyzing situations and communicating results to decision makers with an emphasis on stockholder's equity, income measurement, income taxes, pensions, leases, and statement of changes in financial position.
In this assignment, you will demonstrate your mastery of the following course outcomes:
- Analyze stockholder sections of balance sheets for how they inform stakeholders of equity positioning.
- Interpret income measurement for determining the accuracy of financial statements.
- Analyze the effect of income taxes and their impact on financial statement accounts for appropriate estimation and planning.
- Evaluate various pension plans for their implications on balance sheets and income statements.
- Differentiate between operating and capital leases for addressing their impact on balance sheets and income statements.
- Analyze complex financial statements for informing stakeholders in making economic decisions.
Your portfolio pieces for this project will include memos, spreadsheets, and a final report.
At the most recent strategic planning meeting, the board of directors of your company has voted to issue additional stock to raise capital for major expansions for the company in the next five years. The board is considering issuing a total amount of stock worth $5 million. The CEO has asked you to analyze the impact of issuing this stock on the income statement, statement of retained earnings, balance sheet, and cash flow statement. Take the most recent financial statements and prepare a set of projected financial statements based on the given assumptions.
Specifically, the following critical elements must be addressed:
Leases-
A. What are the differences between operating and capital leases?
B. Describe the particular leases of your company based on the liability section of your company's balance sheet.
C. What impact have the leases had on the company's financial statements for the most recent year?
D. Discuss the advantages and disadvantages of leasing a building versus purchasing one.
Statement of Changes in Financial Position-
A. From the perspective of an investor, determine whether or not you would invest in your chosen company based on the company's statement of changes in financial position (SCFP). Support your opinion.
B. Review the company's SCFP for any concerns that may need to be addressed. As controller of your company, prepare a memo to your CEO, giving a summary report for possible recommendations.
Report for CEO-
At the most recent strategic planning meeting, the board of directors of your company has voted to issue additional stock to raise capital for major expansions for the company in the next five years. The board is considering $5 million. Take the most recent financial statements and prepare a set of projected financial statements based on the given assumptions. The CEO requests that you prepare a written report (including the financial statements) for her.
A. Generate a projected income statement based on the given scenario.
B. Analyze the impact on the income statement based on the given scenario.
C. Generate a projected statement of retained earnings based on the given scenario.
D. Analyze the impact on the statement of retained earnings based on the given scenario.
E. Generate a projected balance sheet based on the given scenario.
F. Analyze the impact on the balance sheet based on the given scenario.
G. Generate a projected cash flow statement based on the given scenario.
H. Analyze the impact on the cash flow statement based on the given scenario.
Attachment:- Annual Report.rar