...16.1 The checks that Park Place writes create disbursement float, which is “good” float. The clinic has $1,000 x 4 days = $4,000 in disbursement float. The checks that the clinic receives create collections float, which is “bad” float. The clinic has $1,000 x 3 days = $3,000 in collections float. The clinics net float is $1,000: Net float = Disbursement (good) float – Collections (bad) float = $4,000 – $3,000 = $1,000. In essence, the balance on the firm’s books is $1,000 less than the balance shown on the bank’s books. 16.2 a. The annual cost of operating the lockbox system is $103,350: Total cost = (Fixed cost per month x 12) + (Number of locations x Number of transfers x Cost per transfer) = ($6,500 x 12) + (10 x 260 x $9.75) = $78,000 + $25,350 = $103,350. b. The annual benefit is $97,500: Benefit = Number of days saved x Payments per day x Carrying cost = 3 x $325,000 x 0.10 = $97,500. c. In this situation, the annual cost of the lockbox system is greater than the annual benefit, and hence the lockbox system should not be initiated. 16.3 a. Seattle must pay the bills in 20 days if it wants to take advantage of the discount of three percent. If it wants to take the costly trade credit (forego the discount), it must pay the bills in 60 days. b. Using the approximate cost formula, the cost is 27.8%. Discount percent ...
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...Stryker BUAD 341-0, MWF 1:00PM Isral Hadero 04/28/2014 Table of Contents Introduction 1 Theme 1 History of the Firm 1 Product Line of the Company 3 Industry History and Analysis 4 Major Competitors 4 NAICS Numbers 5 Relative Industry Sales, Returns and Maturity 5 Stock Performance 6 Financial Analysis 7 Ratio Analysis 9 Pro forma 11 Assumption 12 Growth Rate of Sales 12 Asset Acquisition 13 Financing Needs 13 Conclusion 14 Appendices 15 Income Statement 15 Balance Sheet 16 Sources and uses 17 Percentage of Sources and Uses 19 Firm Ratios 21 Industry Ratios 22 Graphs of Ratios 23 Bibliography 26 Introduction This paper contains the financial analysis of Stryker corporation and its major competitors during the past 5 years. Also a 3 year forecast is created to show were the company is heading and changes needed to be made to be more efficient. Theme Time are hard for the medical industry with the global economic crisis and with the announcement of the Affordable Care Act’s medical device excise tax. Stryker corporation has done better than the industry on average sustaining a strong financial while presenting new products in the market. Growth is becoming slow for mature firms but Stryker is making all the right moves to dominate the market. To increase growth the company has shifted its focus on acquisitions. With the acquisition of Trauson, a Chinese leading manufacturer of surgical products...
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...How to Manage Cash Account and Transactions in NGOs – NGO Financial Management Policy Cash payments need to be documented firmly by NGOs in their financial management policy. Since small sums of cash payments are common on a day-to-day basis, a certain procedure needs to be developed and mentioned in the policy manual. An example is given below: “3. Cash Handling 3.1 Cash Account and Transactions Cash transactions are to be resorted only for petty expenses and when /where banking facilities are not available. As per Income Tax Rules, no claim exceeding $______ should be settled through cash payments. These should invariably be by account payee checks only. As a matter of procedure and control, the attempt should be to minimize the number of cash transactions. 3.2 Daily Cash Balance The denomination of the closing balance of the cash should be entered below this and signed by the Accountant. This register has to be maintained from the beginning of the financial year. A fresh register has to be started at the beginning of every financial year. Maximum and minimum cash limits have been fixed as: maximum $______ and minimum $______. 3.3 Withdrawal of Cash from Bank a) The Cash Withdrawal Form/Money Indent to be filled up and signed by the staff handling cash. b) The cash balance available and the estimated expenses would need to be computed. c) The authorized persons must verify the requirement before signing the check for withdrawal of cash. d) The signature of the person presenting...
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...invested in fixed assets in many companies, there may be a specific person assigned within the accounting, finance, or controllers department to keep track of property, plant, and equipment. This person may be called a fixed asset accountant, property accountant, or may have some other similar title. This accountant's primary responsibility is to maintain the official fixed assets records for the business or organisation. This may be a full-time position in a company that has a large investment in fixed assets and that has either a high volume of activity in fixed assets, or has major capital expenditure projects in process. In operations where keeping track of fixed assets does not involve sufficient work to occupy an accountant full-time, this responsibility may be combined with other accounting duties. The level of responsibility of the person in charge of fixed assets, and the functions performed will also depend on the size and nature of the operation, and the way in which the organisation is set up to handle accounting and reporting for property, plant, and equipment. Accounting for fixed assets may be more of a clerical function, involving entering data and maintaining records. Or the position could involve more of a financial analyst role, where the person would participate in economic evaluations of proposed projects. An audit role may also form part of the overall planning, controlling and reporting function for capital expenditures. What Does A Fixed Asset or Property...
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...Contents Chapter 1 Introduction & Methodology ................................................................. 1 1.1 Introduction..................................................................................................... 1 1.1.1 Square Textiles Ltd. at a glance................................................................. 1 1.2 Objective of the study ...................................................................................... 11.3 Methodology ................................................................................................... 21.3.1 Financial Analysis techniques ................................................................... 21.3.2 Statistical Techniques ............................................................................... 31.3.3 Nature and Source of Data ....................................................................... 31.3.4 Time Period under Consideration .......................................................... 31.3.5 Standard of comparison ........................................................................... 31.4 Limitations of the study ................................................................................... 3 Chapter 2 Analysis & Interpretation of Financial Data ........................................... 5 2.1 Balance Sheet Analysis ..................................................................................... 52.1.1 Sources of Discrepancies in the Balance Sheet ......
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...financial statements. Items that were analyzed were debt ratios, margins, certain asset items, and efficiency ratios. Several conclusions were made during the analysis. First, companies with more competition or a low-priced strategy tend to have lower gross margins due to pricing constraints. Second, companies that are acquisitive tend to have higher debt levels, which increase the debt ratios. Lastly, companies with cost-saving initiatives tend to have lower SG&A, which adds to profit margins. (Damodaran) Exhibit 1 is attached at the end. Industry Analysis Healthcare: Company A is most likely the diversified health-products company. According to the financial statements, company B is most likely the pharmaceutical company that is focusing on its core competency, which is strictly drug development. COGS is much lower than company A, who has a diversified product base. Since Company B relies on exclusive deals it can charge premiums on its product, which is shown by its higher gross margin. Company B has lucrative licensing, which can be shown by the high intangible assets. Beer: Company C is most likely the national brewer of mass-market beers sold under a variety of brand names. Its high net fixed assets, due to the company owning a large number of breweries and distribution centers, can show this not to mention the several theme parks it owns. It has relatively higher intangible assets because its beer is sold under a variety of brands that consumers identify with...
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...Ageing Analysis Timely update Cash Receipts for All Cash and Trade Debtors Identify and receipting of all Direct deposits Perform other duties directed by the Financial Reporting Team Leader and Manager Finance Accounts Officer Work Experience: Teachers Savings & Loans Society Ltd FINANCE & ACCOUNTING DIVISION 14 Dec. 2010 – 12 April 2013 Duties involved: • • • • • • • • • • • • • • Data entry/Process journal entries - General Ledger accounts Balance Sheet reconciliation Raise and update Journals Liaise with Commercial banks for short term liquid investments (IBD) and raise Payment Voucher Daily Electronic Transfer of Cash to various TSL Bank accounts Prepare daily Cash Position Report for C.E.O and other respective Managers Monthly Fixed Asset Register update Bank Reconciliation - ANZ and Westpac bank accounts Reconcile and reimburse Petty Cash for Head Office and all Branches Process monthly payment for Loan Protection Insurance Premium cover Responsible for timely update of cash receipts Co-ordinate Branch Account queries Account for Promotional items and month end stock take....
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...potential of improved fixed asset management is often overlooked. It’s difficult to find the time and tools to devote the attention to fixed assets that they deserve. Yet assets like land, buildings, transportation, and manufacturing equipment, represent the largest investments most companies make. Sound fixed asset management can yield substantial tax savings in depreciation deductions. Conversely, sub-optimal fixed asset practices can threaten the accuracy of financial reports and negatively impact your bottom line body : There is nothing more critical to effective management of fixed assets than beginning with an accurate fixed asset inventory. Without it, no amount of added processes, controls, or correct calculations can ensure the accuracy of fixed asset accounting. The only reliable way to verify and validate the fixed asset information is to conduct a physical inventory. Eliminate “ghost” assets: A “ghost” asset is property that is lost, stolen, or unusable, but is still listed as an active fixed asset in the system.If 10-30 percent of fixed assets on the books are ghost assets, a company might be overpaying taxes and insurance on those assets by up to 30 percent. Ghost assets that are not identified can cause lost productivity because missing or unusable assets are not available when needed. Tag assets appropriately: When a company owns multiple fixed assets that are nearly identical, it can be very easy to make mistakes by creating duplicate asset records or failing...
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...Ratio of INDUSTRY PROFITABILITY RATIO: It shows business's ability to generate earnings as compared to its expenses and other relevant costs incurred during a specific period of time. For most of these ratios, having a higher value relative to a competitor's ratio or the same ratio from a previous period is indicative that the company is doing well.So here we see that Maruti has a higher percentage than the competitors.Thus we can say that the company is doing well in this ground. Profitabilty Ratio of Dr.Reddy Profitabilty Ratios Of IndustryS TURNOVER RATIOS: Dr.Reddy shows a lower Inventory turnover Ratio than the industry.So,we can saythat Dr.Reddy has encountered weak sales. The Fixed-asset turnover ratio measures a company's ability to generate net sales from fixed-asset investments - specifically property, plant and equipment (PP&E) - net of depreciation.Dr.Reddy has almost similar...
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...1. Rule 301, Confidentiality, allows an auditor to disclose client information under several different conditions. Which statement is NOT one of the conditions where an auditor is allowed to disclose client information? a. 0 In response to a subpoena from a court of law b. 0 In response to an inquiry by a state licensing board c. 0 In response to a peer review d. 0 In response to a request from a major shareholder Objective: Explain the role of budgets in management controls. 2. If an auditor can show they acted in good faith when reporting on forecasts the auditor's liability may be reduced or eliminated under a. 0 Regulation S-X. b. 0 Securities Exchange Act of 1934. c. 0 proportionate liability. d. 0 safe harbor provisions. Objective: Compare and contrast the use of budgets as financial controls between for-profit and governmental entities. There are no test questions associated with this objective. Week Two: Risk Management Objective: Analyze the relationship between risk and return. There are no test questions associated with this objective. Objective: Explain the portfolio approach to risk management. 3. In identifying matters for communication with an entity's audit committee, an auditor most likely asks management whether a. 0 the turnover in the accounting department was unusually high. b. 0 it consulted with another CPA firm about accounting matters. c. 0 there were any subsequent events of which the auditor was unaware. d. 0 it...
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...authorisation to issue or amend Purchase Orders given in writing, or electronically with password restrictions. • Ensure whether system user profiles and access rights are used to ensure that only authorised individuals have access to purchase orders. • Review the process of negotiation for contracts. Check whether tenders are invited, evaluated and that the most competitive tender was accepted. In cases where the most competitive has not been accepted, inquire into the reasons. Ensure the reasons are documented and have been duly approved by the Site Procurement Head. • Select a sample of atleast 50 Purchase Orders (P.O.’s) covering the purchase of: Major Raw Materials sourced by the site. Major Packing Materials Capital Assets Services (e.g. Transportation, AMC’s, etc.) • For the sample selected, review the P.O.’s to ensure completeness in all respects such as date, serial number, amendment no., if any, terms and conditions, due dates for receipt of materials, insurance, penalty clause, signature, etc. • Ensure that all P.O.’s are system generated and are serially controlled. Also, review the controls within the System that prevent unauthorized access to and generation of...
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...There are two dimensions to consulting CONSULTING DIMENSIONS Process Consulting Tools Frameworks Analysis Tools seniority Project structuring Roles and responsibilities Execution Sequencing - Workplan Client management 0 Typical Elements of Consulting Process Problem Structuring : Key Issue Identification Team formation and Work-plan creation Problem Solving Data collection and analysis Option generation and evaluation Recommendation Syndication Implementation The process is not sequential but iterative 1 Frameworks and Tools 2 Different frameworks / tools are available to address specific questions TOOLS Question Theory Framework / Tool Which industry will be globally competitive in the long term? How attractive is this industry? What is the demand likely to be? Porters Diamond Porters Five Forces Demand Estimation How is the industry evolving Value chain analysis International Case Studies Which business to focus on? Which to divest? GE-McKinsey BCG matrix SWOT 3 Different frameworks / tools are available to address specific questions TOOLS Question Theory Framework / Tool What are the broad competitive strategies? What are the opportunities for growth? Discipline of market leaders Generic strategies Ansoff Matrix 7 degrees of freedom Market segmentation ...
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...business. Company A has higher receivables (12.8%) than Company B, 8.1%. This is probably because Company A distributes their products to institutions like hospitals, clinics and etc. Institutions take longer time to pay, while Company B distributes their diversified health-products to end-consumers or to the mass market by cash settlement or short credit term. Inventory turnover for Company A (3.08x) is higher than Company B (0.93x), that means inventories are sold and replaced faster than Company B. Company A has higher turnover because those institutions, especially hospitals “consume” health products faster and more. Lastly its show Company A has deep pipeline of its ethical pharmaceuticals. On the other hand, Company A has net fixed assets of 19.6%, higher than Company B (14.9%), which probably because Company A has more equipments to support their robust research and development. Intangibles e.g. goodwill for Company B (46.1%) is higher compared to Company A (22.2%) because B focus more on their brand development....
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...open the DFA emphasized on participation by all present. • The first paper was presented by the Senior Manager, Final Accounts/ K.M.Jemaku. Titled: FIXED ASSET MANAGEMENT – OPERATION & CHALLENGES: It defined and classified fixed assets, their management, depreciation and disposal. The management of Fixed Assets was noted to be a huge challenge to Finance & Accounts Department because of the many lapses imminent. The Sun System Fixed Assets module captured most of the detail data identifying an asset, and provides information automatically. Each asset is then assigned a code to further give the required peculiarity in the database. The presenter identified the challenges as follows; - Time lag between coding and labeling of assets. - Difficulty in tracing assets to assigned locations. - Failure to code some assets making disposal difficult. - Inability to reconcile physical assets with the register. Other issues relating to management of Fixed Assets were mentioned as; - Disposal of such assets without the knowledge of Finance Dept. - State Offices charging assets disposed to sundry income. - Vandalizing of assets particularly computers. - Wrong classification of assets by Admin/Stores. - Unregistered transfer of assets from one user to another. - Non-clarity of location of assets. - Non recognition of...
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...record the revenue statement and reconcile the balance with branch. Record the fund transferred from various exchanges and crosscheck with the revenue ledgers and if necessary correspond with the bank. Update the fixed asset register for each addition of assets on the basis of disbursement or Journal voucher Record the detail of transfer in the fixed asset register at the headquarter Inspect asset on receipt of scrap report and make necessary entry in the books Calculate depreciation at the end of each month as per the rates prescribed by the statute. Carry out annual physical verification of fixed assets with reference to the fixed asset register. Prepare physical verification report and submit to the management. Obtain approval from the management to write off missing, unserviceable, damaged or condemned assets and pass necessary entries in the books of accounts. Prepare the scrap report for the auction. Account the unaccounted fixed assets in the books. Capitalise the interest payable on loans borrowed for construction and purchase of assets until the commissioning of project. Account for the fixed assets acquired through any grant. Calculate depreciation on such assets. Transfer capital work in progress to fixed asset on completion of project. ...
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