Assignment: Annual Report/10K Research Exercise
Go to your company's website and you will find a section containing annual report/10K filings. Use the most recent filing to find the answers to the questions that follow. Prepare your responses in a word file and attach copies of the applicable pages from the report to support your answers.
1. Who are the outside auditors for the firm? What type of opinion did the company receive from the auditors with respect to the company's financial statements?
2. In the Management Discussion and Analysis section, what are the risks that may affect the company's operations?
3. Has management identified any new accounting standards that have the potential to affect the company? Explain. What accounting standards have recently been adopted by the company?
4. Calculate the company's current ratio for all the years where the company presents financial data.
5. Does the company maintain inventory? What inventory method does the company use? Has it recently changed its method of inventory valuation?
6. How does the company depreciate its assets? What is the value of its assets located in the United State versus outside the U.S. (Hint: look at its geographical disclosure data)
7. Does the company have any intangible assets on its balance sheet? What are they?
8. How much long term debt has the company issued? How much debt will mature over the next three years?
9. Besides common stock, does the company have preferred stock outstanding? If so, summarize the terms of the preferred stock (i.e., cumulative, dividend rate)
10. Does the company have a complex capital structure as discussed in chapter 16? If so, what items factor into the calculation of diluted EPS?
11. Has the company made any recent changes in its manner of recognizing revenue? Explain.
12. What is the company's effective tax rate? What is the amount of DTA's on its balance sheet? Is there a valuation allowance on the DTA's? Is so, explain why. What are the two most significant temporary differences giving rise to the company's DTA's?
13. Does the company have a stock option program? Restricted stock?
14. Does the company sponsor a defined benefit pension plan? If so, is the plan over or under funded? Explain.
15. Does the company lease assets? If so, what are its commitments (in $) for operating leases and for capital leases?
16. For the most recent year, how much cash did the company generate from operating activities?
Did it generate cash from financing activities? If so, what did it do?