JET Task 1 - Graded A+ solution

TASK 1 – FINANCIAL STATEMENT ANALYSIS AND CONTROLS
Requirements for Task 1:
A. Prepare a summary report in which you do the following:
1. Evaluate the company’s operational strengths and weaknesses based on the following:
a. Review the horizontal analysis, analyze the results, and discuss operational areas of
concern.
b. Review the vertical analysis, analyze the results, and discuss operational areas of
concern.
c. Review the trend analysis, analyze the results, and discuss operational areas of
concern.
d. Review the ratio analysis, analyze the results, and discuss operational areas of concern.
2. Analyze the working capital of Competition Bikes, Inc. Consider the following in your
analysis:
a. Ways to improve the working capital
b. Ways to use excess working capital to generate an increase in profits
3. Evaluate the internal controls for the Competition Bikes, Inc. purchasing system.
a. Recommend corrective actions for any weaknesses.
b. Identify the risks to the company.
i. Discuss how to mitigate the risks arising from internal control weaknesses.
4. Analyze compliance with Sarbanes-Oxley requirements.
a. Recommend corrective actions for noncompliant areas.