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Financial Analysis of Jp Morgan

In: Business and Management

Submitted By regina123
Words 677
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ANALYSIS OF BALANCE SHEET
The condensed statement and trend analysis show that from 2010 to 2012, the company’s total assets increased by 11%. Current assets and PPE increased by 13% and 9% respectively but on the other hand, goodwill and other assets continued to decrease by 13% and 3% respectively. Increase in deposits with banks and thefederal reserve and purchase under resale agreements were so significant and contributed to the total increase in assets. Deposits increased from $85,279 in 2010 to $121,814 in 2012 and federal fund sold and securities purchased under resale agreement increased from 235314 to 296296. The decrease in goodwill by 12% from 2010 to 2011 was due to Assets Managements sale of its investment in an investment manager. Goodwill did not impair in 2011 and 2012. The slight increase was due to foreign currency adjustments and other tax related adjustments.
Total Liabilities and stockholders’ equity increased by 11% from 2010 to 2012. Trend analysis for liabilities and stockholder’s equity were prepared individually to see the changes in each of them. The analysis showed that liabilities increased by 4% from 2011 to 2012 and by 15% from 2010 to 2012. This increase was as a result of growth in consumer and whole deposits which were a large fraction of total current liabilities. Stockholders equity on the other hand increased by 8% from 2011 to 2012 but still showed a decrease of 13% from 2010 to 2013. The increase from 2011 to 2012 was triggered by the high net income figure which will be explained in the analysis of the income statement.
The common size balance sheet shows that in 2012, 80.8% of assets were financed by current liabilities. This is just a 0.1% increase from 2011 and a 5.4% increase from 2010. 8.7 % of total assets were financed by stockholder’s equity and this is a decrease since in 2010, the figure was 11.9%.
In conclusion,…...

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