Financial Ratio Analysis

The company has also invested in national football league (NFL), and it seeks to promote its products by targeting the NFL audience. National basketball association (NBA) is another area where the company has invested. Other investments by the company include partnerships with La Liga and Liga MX. These tools are used as avenues of enlarging the market base by targeting the respective audiences. The company has also invested in content delivery networks (CDNs), Verizon hearts media partners, awesomeness TV holdings, LLC and complex media, Inc. (Verizon Communications Inc., 2018).

Consolidation Accounting

Verizon’s investments in AOL Inc. and Yahoo! Inc. should be accounted for under the consolidation approach to accounting. This is based on the level of ownership that meets the 50%+ minimum threshold set for consolidation accounting. The investments on NBA, La Liga, Liga MX and NFL should be accounted under the cost method. This viewpoint is based on the low level of ownership of Verizon on these entities. Awesomeness TV holdings, LLC, and complex media too should be accounted under the cost method because of the passive ownership of the company. These acquisitions were made by the virtual of a partnership between Verizon and Hearts. For the case of Verizon hearts media partners, it should be accounted under the equity method. The level of a township is below 50%+ stipulated for consolidation but more than 20% minimum for equality accounting method (Lubbe, Modack &Watson, 2014).

The Significance of Overall Entity's Financial Statements

Accounting for AOL Inc. and Yahoo! Inc., all the revenues, expenses, liabilities and profits are included in the balance sheet. However, deductions are made concerning the percentage of the entities that are not owned by Verizon. Accounting for NBA, La Liga, Liga MX, NFL, awesomeness TV holdings, LLC and complex media the investments remain in the balance sheet based on their original costs. Dividends are deemed as revenues. For the case of Verizon hearts media partners, changes in income are made by the proportion of the investment owned by Verizon. Losses are deducted from the value of investment owned by Verizon (Verizon Communications Inc., 2018).

Additional Notes Verizon has in their Form 10-K

Other notes held by the company in the 10-K form include the history of the business, its nature as well as its products. This includes changes that have occurred in the organization since establishment. Mode of payment for respective services is also included. For example, postpaid and prepaid wireless basis are highlighted (Verizon Communications Inc., 2018).

The form also includes information that concerns licensing and relations of the company to laws that exist in the business. Respective regulations by the federal government are included too. Regulations, in this case, are highlighted with regards to different jurisdictions of operation. They include the federal, state and local legislation (Verizon Communications Inc., 2018).

Relationship of the company to stakeholders is another aspect captured in the 10-K form. Stakeholders to this effect include employees, executives, consumers as well as the local community. In particular, the relation of the business to the environment is highlighted. Equity ownership by stakeholders is captured too (Verizon Communications Inc., 2018).

Other Notes Significant to Verizon

There exist other aspects of chief importance in the analysis of the organization. Performance of the products in the market is also included in the 10-K form. These performances are anchored on strategies marketing strategies adopted by the company including the focus on essential attributes such as reliability and pricing. The information highlights market share and essential trends that determine the viability of businesses to stakeholders (Verizon Communications Inc., 2018).

The level of competition is also included in the form. It includes future expectations and strategies adopted by the company to compact this threat. They include product differentiation and enhancement of quality and efficacy of the organization. It forms a basis for establishing performances in the future and therefore are an essential aspect of accurately analyzing the business (Verizon Communications Inc., 2018).

Additional Disclosures Helpful in the Evaluation of Verizon’s Financial Health

The volume of investor generally handled by the organization is useful information that would have aided in the analysis of its financial health. This information provides trends in sales and therefore helps to establish the performance of the organization in different timelines (Verizon Communications Inc., 2018).

Net income of the company over the last financial year is another crucial information missing in the form 10-K. It is central to the determination of liquidity of the company as well as other indicators of the economic viability of organizations (Verizon Communications Inc., 2018).

Evaluation of Verizon’s Financial Health Change

Additional information provided by the form 10-K accurately depicts the financial health of the organization compared to the analysis done in week 4. The inclusion of investments by the company profoundly affects the financial performance due to the implications of the investments in financial reporting. A fundamental basis upon which the financial health of the business should be considered as more viable is the availability of investments that contribute to income generation (Verizon Communications Inc., 2018).

References

Lubbe, I., Modack, G., & Watson, A. (2014).Financial accounting GAAP principles. OUP Catalogue.