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The firm I am doing a Financial Statement analysis of is Nike and what a financial analyst might find useful within its Annual Report.  Nike will be interesting to research because of its popularity and how well it is doing financially. The financial analyst will review the financial statements along with the notes to develop an understanding of how the business is doing and their projected financial performance.  Along with this information, the section labeled Management Discussion, and Analysis (MD&A) is also useful because it contains information not found in the financial data. “This section includes reporting of any favorable or unfavorable trends and substantial events or fears when it comes to liquidity, capital resources, and results of operations” (Fraser, 2010). Along with the financial statement and MD&A, the annual statement provides the detailed information required to disclose financial information and is an excellent tool for decision making. This Financial Analysis report will consist of:

 

 

 

  • financial statements

  • notes to the financial statements

  • the auditor’s report

  • a five-year summary of key financial data

  • high and low stock prices

  • management’s discussion and analysis of operations.

 

 

 

Financial accounting statements prepared for external users must comply with the generally accepted accounting principles (GAAP). External users must have some guarantee that the reports developed by a joint set of ground rules” (Noreen, Brewer & Garrison, 2011, pg. 35). With the guarantee of required standards and ethics, annual reports reduce fraud and misrepresentation allowing future reporting standards to help decrease the cost of analyzing and summarizing financial data.

 

The lesson that applies to Nike being visual as shown on the link below:

 

http://investors.nikeinc.com/files/doc_financials/AnnualReports/2013/index.html

 

 

 

References

 

Epstein, L. (2014). Financial decision making: An introduction to financial reports. San Diego, CA: Bridgepoint Education, Inc.

 

Fraser, L. M., & Ormiston, A. (2010) Understanding financial statements (9th ed.).  Upper Saddle River, NJ:   Pearson Prentice Hall. 

 

Noreen, E.W., Brewer, P. C., & Garrison, R. H., (2011). Managerial Accounting for Managers, New York: McGraw-Hill

 

 

 

Final Paper: Financial Statement Analysis

Focus of the Final Paper

Prepare an 8- to 10-page fundamental financial analysis (excluding appendices, title page, abstract, and references page) that will cover each of the following broad areas based on your chosen company's financial statements:

  1. Provide a background of the firm, industry, economy, and outlook for the future
  2. Analyze the short term liquidity of the firm
  3. Analyze the operating efficiency of the firm
  4. Analyze the capital structure of the firm
  5. Analyze the profitability of the firm
  6. Conclude with recommendations for the future analysis of the company (trend analysis)

Writing the Final Paper
The paper:

  1. Must be 8 to 10 double-spaced pages in length (not including the title and reference pages) and formatted according to APA style as outlined in the Ashford Writing Center. 
  2. Must include a title page that includes:
    • Title of paper
    • Student’s name
    • Course name and number
    • Instructor’s name
    • Date submitted
  3. Must begin with an introductory paragraph that has a succinct thesis statement.
  4. Must address the topic of the paper with critical thought.
  5. Must end with a conclusion that reaffirms your thesis.
  6. Must use at least three scholarly sources from the Ashford University Library, in addition to the text.
  7. Must document all sources in APA style as outlined in the Ashford Writing Center.
  8. Must include a separate reference page that is formatted according to APA style as outlined in the Ashford Writing Center. 

Carefully review the Grading Rubric for the criteria that will be used to evaluate your assignment.

 

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