SEC 10-K Report

SEC 10-K REPORT - COSTCO WHOLESALE CORPORATION

SEC 10-K REPORT - COSTCO WHOLESALE CORPORATION

SEC 10-K REPORT

COSTCO WHOLESALE CORPORATION

Linh Chau

ACCT 424

02/15/2022

Introduction

Costco Wholesale corporation and its subsidiaries started their business in 1983 in Washington, and since then, it has never looked back and continued to make the huge success in the businesses. The company is quite good at maintaining warehouses in different countries like the United States (U.S.) and Puerto Rico, Canada, the United Kingdom (U.K.), Mexico, Japan, Australia, Spain, Taiwan and Korea. The company is involved in the stock business under the logo of COST. It is included in the list of fortune 500 companies, and as far as the products and services are concerned, it is important to note that the company is involved in furniture-like products. Comment by Dr. Yelle: Sources / citations needed for all statements of fact

The company has mainly retained its business success through the retailing stores. Most of the revenue is generated through it. The company is proud of its customers and intends to open several stores worldwide to serve the huge market. The company has 254000 members to date, and it has been a wonderful journey from opening one warehouse to thousands of them in the different regions of the world. There are several company competitors, but it has always proved itself at the top of the market and warehouses. Comment by Dr. Yelle: You sure about that figure? Comment by Dr. Yelle: Sources / citations needed

The topic of discussion is to determine the K-10 form and its analysis. The company claims to deal with a large number of warehouses with the repetitive turnover of the clients. It helps the client get the public and private label quality products sold at high prices, and the revenue generation is quite high. The analysis of the K-10 form will reveal the revenue and money generation of the company. The company has huge revenue and solid strategies because of which it is not worried about the competitors. Despite all these factors, there are certain risk factors of the company that should be minimized.

key points etc. of segment and NCI reporting and disclosure requirements

The companies are not willing to disclose all about their revenue and financial statements, but a limited amount of information is disclosed. NCI has made certain rules for the companies, and it includes the guidelines that what should be included in the company's report and what should be avoided. Certain factors cannot be hidden from the customers, and NCI never permits the companies to go against the rules. Comment by Dr. Yelle: NCI isn’t a rule-making thing. Not sure what you’re trying to say?

NCI's history of developing the rules is interesting because there are many companies with different guidelines and rules through which they operate. The companies that have to operate through the subsidiaries needed guidelines about the disclosures and the other requirements. The financial statements are an important part of a company's report, so NCI formulated certain guidelines that are now compulsory to be followed by the companies. The subsidiaries and the relevant companies need to publish their 10 K form, and NCI has restricted the companies to show the information required for the ease of customers. Comment by Dr. Yelle: Again, NCI stands for Non-Controlling Interest, which is just a category of something, not any type of standard setting authority.

The first requirement and rule are to disclose the information about the business structure to make the customers understand the organization. There are different ways the subsidiaries can work, and each organization has a different and distinct way to deal. The organizational structure is important for the customers to understand because many of them can be retailers and third parties that have to do the business. The connections between the customers and companies can only become stronger when the information is properly disclosed, and the organizational structure is clear. Comment by Dr. Yelle: None of this discusses the specific rules and requirements of NCO or segment reporting and disclosure?

There are two forms of showing the necessary information of the company. One of them is to include the details in the subjective form where the company's structure and other requirements are shown. The customers could easily read them to get the proper information, and the second type is to present them in the tabular form. The tabular form is presented to look at the data is a glimpse. It is important to know that the necessary information should be disclosed to read and understand easily. The companies should consider all these points.

Another important requirement or disclosure mentioned in the NCI rule is to present the financial information about the company. The company cannot show the completed details of the financial information in detail. The form requires that there should be highlights of financial information. For example, the company should disclose the proportion of interests and ownership to satisfy the customers and maintain the record. It is important to discuss the net and gross profit with other information. The comparison of profit and input from the last year should be shown, but there should be trends of financial information involving the five years or ten years (Gluzova, 2016).

Summary of findings

The business companies are responsible for demonstrating various aspects of the 10k form, but in the current discussion, the two segments, including the business and finance segment, will be discussed. Costco Wholesale corporation and its subsidiaries started their business in 1983 in Washington, and since then, it has never looked back and continued to make the huge success in the businesses. The company is quite good at maintaining warehouses in different countries like the United States (U.S.) and Puerto Rico, Canada, United Kingdom (U.K.), Mexico, Japan, Australia, Spain, Taiwan and Korea. The company is involved in the stock business under the logo of COST. It is included in the list of fortune 500 companies, and as far as the products and services are concerned, it is important to note that the company is involved in furniture-like products. Comment by Dr. Yelle: This is just a repeat of the introduction above?

The company has mainly retained its business success through the retailing stores. Most of the revenue is generated through it. The company is proud of its customers and intends to open several stores worldwide to serve the huge market. The company has 254000 members the date, and it has been a wonderful journey from opening one warehouse to thousands of them in the different regions of the world. There are several company competitors, but it has always proved itself at the top of the market and warehouses. Comment by Dr. Yelle: Again, just a repeat of the introduction above

The financial data is important to demonstrate and show the customers because the experts and the business-related customers are interested in knowing about these factors. The financial report of the years from 2011 to 2015 has been shown, and it further reveals that the company publishes it once a year. The company starts from the set of operations and ends at the net profit and sales. It is important to see that the company has disclosed all the expenses throughout the year. The information about the net sales and gross margin have been mentioned. Though many companies tried to hide the data, Costco has shown all the details of the financial statement. It shows the company's concern towards its customers, and the focus was on loyalty. It is projected that the company will succeed in the future if it maintains the same reputation in the market (Form, 2020).

Reflection of company’s disclosure

NCI's history of developing the rules is interesting because there are many companies with different guidelines and rules through which they operate. The companies that have to operate through the subsidiaries needed guidelines about the disclosures and the other requirements. The financial statements are an important part of a company's report, so NCI formulated certain guidelines that are now compulsory to be followed by the companies. The subsidiaries and the relevant companies need to publish their 10 K form, and NCI has restricted the companies to show the information required for the ease of customers. Comment by Dr. Yelle: As above, NCI isn’t anything that makes any types of rules

The business companies are responsible for demonstrating various aspects of the 10k form, but in the current discussion, the two segments, including the business and finance segment. Costco is one of the best examples that showed all the segments clearly and easily. The information about the net sales and gross margin have been mentioned. Though many companies tried to hide the data, Costco has shown all the details of the financial statement. It shows the company's concern towards its customers, and the focus was on loyalty. It is projected that the company will make a huge success if it maintains the same reputation in the market. I think that the company did a fabulous job.

Conclusion

In conclusion, the 10 K forms are highly valuable because they communicate to their customers with their help. The customers can get detailed information about the company and its finance. Costco is one of the best companies that deal with warehouses, and all this information has been presented amazingly in the above discussion.

60%

Area of Assessment	Points	Expectation	Assessment Criteria	Earned
Basic Content in Place	50	1-Must use an approved company that has both segments and NCIs; 2- a brief introduction / review of your chosen entity; 3- coverage of the requirements for segment and NCI disclosures and reporting including clear identification of the actual rules (#s, history / development); 4- summarization of what and how your particular company has disclosed relating to these two items, and; 5- your thoughts on the effectiveness / overall meaningfulness of your company's disclosures and the disclosure rules themselves in only the areas of segments and NCIs	Quantitative: 5 requirements worth 10 points each	30 – No discussion at all on the actual rules (FASB 131, ASC 280, FASB 141, ASC 805), no identification of any actual disclosures in these areas.
Advanced Content in Place	20	Demonstrate an understanding of the subjects of NCI and segment reporting and disclosures within the context of a 10-K report of the student’s chosen and approved entity.	Qualitative: 0 to 20 points depending on the student’s ability to tie together all the requirements into a cohesive presentation	5 – The paper did not at all address the key requirements of identifying and understanding the rules and requirements for segment and NCI reporting. In fact, you’ve presented information that states NCI is some type of governing body, which is about as far off the mark as one can get.
Overall Analysis and Evaluation	10	1,000 to 1,800 words required to properly address the topics at hand; headings used to identify the four primary subject areas required; appropriate and relevant outside literature used and referenced properly.	Qualitative: 0 to 10 points depending on the student’s ability to demonstrate an understanding of the topic at hand and ability to lay out the discussion of same in a meaningful, logical manner.	5 – Paper repeated information and did not draw from any relevant outside literature as required.
Meets Presentation Requirements	5	Single-spaced; double-spacing between paragraphs; one inch margins; font size 10-12; cover page.	Quantitative: 5 requirements worth 1 point each	5 – All technical presentation requirements were met
APA In-Text Citations and Reference Section	5	“Works Cited” section included at end; proper in-text citations used and all facts are cited	Quantitative: 5 points for including the Works Cited Section and proper in-text citation of all facts	5 – Included and used as required
Clarity, Mechanics, Grammar	10	Free of spelling and grammar mistakes. Text and sentence structure should be clear and readable. Free of choppy or incomplete sentences. Proper use of paragraphs. No active hyperlinks anywhere in the paper.	Quantitative: 10 points if totally free of grammar / spelling errors and active hyperlinks; 5 points if minor grammar / spelling errors and or active hyperlinks; <5 points for numerous spelling grammar errors, 0 points when no demonstrable attention has been paid to grammar / spelling.	10 – Perfectly free of grammar errors and active hyperlinks

References Form. (2020). SECURITIES AND EXCHANGE COMMISSION. Retrieved from file:///C:/Users/hp/Downloads/CostcoWholesaleSEC10-K.pdf Gluzová, T. (2016). Disclosure of subsidiaries with non-controlling interest following IFRS 12: the case of materiality. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, 64(1), 275-281.

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