JWI 530: Financial Management I

JWMI 530 Course Guide – Spring 2014


Assignment 2: Annual Report Review



Due Week 6, Day 7 (225 points)


The specific course learning outcomes associated with this assignment are:


• Analyze financial statements using financial ratios.

• Analyze and evaluate cash flows over time.

• Use technology and information resources to research issues in financial management.

• Write clearly and concisely about financial management using proper writing mechanics.



This project requires that you conduct a financial analysis of two, comparable organizations. You



may select any organizations that produce publicly available financial statements employing IFRS



or U.S. GAAP (both companies must follow the same GAAP). Let your professor know which two



companies you plan to study before the end of Week 2, as your selection must be approved. The



professor reserves the right to limit the number of students comparing the same two



organizations.



Assignment:



1. Carefully review the annual reports for both organizations. Comment on what approach




each company has taken in reporting to its shareholders. (This requirement is purposely







broad to give you the freedom to talk about anything that comes under the broad title of



“reporting to shareholders”).







2. Prepare a ratio analysis for both companies including a trend analysis for three years.



Comment on the significance of the ratios for each company (do they indicate that things



are all right, do they suggest that problems exist, or is it likely that problems will occur in



the future?). Comment specifically on the similarities and differences among the ratios



calculated for both companies and comparison to any benchmark.




3. Prepare an analysis of the cash flow statements for both companies.






4. List and discuss the importance of the two most significant accounting policies adopted



by the two organizations (you should select the same two policies for both organizations).



Explain the options selected by both companies and comment on any differences that



you see. Explain what other policies the organizations could have selected and state why



you think they selected one policy over another.



5. Provide the URL’s for each company’s Annual Report.



Your assignment should adhere to these guidelines:




• Write in a logical, well-organized conventional business style. Use Times New Roman






font size 12 or similar, double space, and leave ample white space per page.




• All references must follow JWMI style guide and works must be cited appropriately.






Check with your professor for any additional instructions on citations.




• On the first page or in a header, include the title of the assignment, the student’s name,






the professor’s name, the course title, and the date. Reference pages are not included in



the assignment page length.




• Faculty members have discretion to penalize for assignments that do not follow these