Finc 351 and 440 Week 4

FINC440 Instructions & Recommendations for Preparing the Course Assignments

(Due End of Weeks 1, 4, 5, 6, & 8) -

The purpose of this note is to carefully explain the general expectations and requirements for the five Assignments that are to be prepared for FINC440. The information and materials presented here are intended to make sure that you clearly understand the general expectations and that there are no misunderstandings about what is to be done and what is expected.

Please review this material so that you are familiar with the specific requirements that are be followed in the preparation and submission of the Assignments.

The Assignments comprise 72% of the final course grade. It will take some time and effort to produce high quality analyses.

Required Outline & Other Information about the Assignments –

1. Work Hard to Avoid Personal Pronouns – The excessive use of personal pronouns is discouraged in business and analytical writing. It is recommended that personal pronouns are avoided altogether, if possible. Please make sure that personal pronouns (e.g., I, we, my, our, etc.) are avoided in paper. It will take some work, but it can be done easily by rearranging the wording of sentences.

2. Companies Are Not “They,” “Their,” or “Them” – This is a reminder that a company is not a “they,” “their,” or “them.” A company is very much an “it.” So, to reference a company, use “it,” the name of the company, or “the company,” or “the organization,” or “the firm,” etc.

3. Outline for Paper –Students must use the required outline for this assignment. The closer that the paper conforms to the required outline, the better! The outline is presented in the next section.

4. Evaluation Rubric – An evaluation rubric is available for the Assignments. It will be used to evaluate the Assignments. The rubric shows the important components that must be included in the papers. It is a good idea to take a look at the rubric and make sure that each Assignment addresses the requirements. A copy is posted with each Assignment in the online classroom.

5. Financial Ratio Analysis – The first Assignment calls for a financial ratio analysis of the company that you selected. You should acquire data from the Mergent Online database available through the UMUC Library. The ratio analysis model (Excel) provided by the instructor is also a useful tool for this Assignment.

6. Subheadings – Each section of the paper must begin with a sub-heading. Please use the sub-headings included in the required outline (presented in the next section).

Here is the Required Outline (It must be used for each Assignment) -

The five class Assignments are intended to be constructive learning experiences. They are designed to show students how to prepare analytical reports in finance using critical thinking, research, and writing skills. The following outline is to be used for each Assignment:

1. Cover Page - Include a cover page containing the title of the Assignment, the student’s name, the professor’s name, the course title, and the date.

2. Introduction – The Introduction must include:

(a) A review of the Assignment purpose, research methods and the principal information sources, and other information related to the completion of the analysis.

(b) The introduction should also include an overview of the sections of the paper that follow. (1/2 to 1 page)

3. Analysis Section – The body of the report is to address the assigned topics and questions. It is essential that students include appropriate in-text reference citations in APA format:

4. Summary / Conclusion – The summary or conclusion should review the major observations, conclusions and recommendations developed in the analysis. No new material should be introduced in this section. (1/2 to 1 page)

6. References – Provide list of references in APA format.

Source of Useful Information - Please remember that financial statements and other useful information are available from the Mergent Online database that is available to you through the UMUC Library (“Resources” tab in the online classroom). Please notice that financial ratios are grouped into appropriate categories (Profitability Ratios, Liquidity Ratios, Debt Management Ratios, and Asset Management Ratios), which makes it easy to set up the ratios and use them in the analysis.

The following information is intended to help you with using the Mergent Online Database available in the Strayer Learning Resource Center:

Financial Statements for companies, financial ratios, and Form 10K annual reports can be obtained from the UMUC Library, which is accessible from the Online Classroom (see “Resources” tab at the top of the screen).

Once in the Mergent database, in the block titled “Company Search, Enter Symbol or Company Name” enter the company’s name or its Stock Ticker Symbol (e.g., for Deere & Company, enter DE). Next, select the company from the drop-down menu.

For Financial Statements – Select “Company Financials” tab

For Financial Ratios – Select “Company Financials” tab and “Ratios” sub-tab

For Form 10K Annual Reports – Select “Filings” tab (and then select the most recent Annual Form 10K report)

Writing Assignment – Comments About Financial Analysis (Ratio Analysis)

The financial ratio analysis is the subject of the first Assignment (due at the end of Week 1).

It may be helpful for you to have some additional information about how to prepare such an analysis, to receive some recommendations, and have a chance to see a sample analysis.

Writing Assignment - Example of Financial Ratio Analysis - An analysis of the company’s financial ratios is the objective of the first Assignment. Included below is the presentation of a simple financial ratio analysis. This is only an example. This one can be improved in many ways. It is presented just to give you an idea about what is expected to be prepared and used in the financial analysis section of the first Assignment.

The analysis that you prepare can include different ratios, it could include figures (graphs) that present the information, or other methods of presentation and analysis.

Some additions and other comments that may improve this analysis are:

1. Include industry average ratios or competitors’ ratios. This is known as “cross-sectional” analysis.

2. It would be useful to include figures “graphs” of the historical ratio data. In addition to the table, this would facilitate the presentation of the “historical” or “trend” ratio analysis.

3. Include a statement or sentence that summarizes the evaluation of each group of ratios – is the company’s performance good, not so good, needing improvement, strong, etc.?

4. As is done with this example, always include the actual ratio data (the actual ratio numbers) in the written analysis in addition to the presentation in the table.

5. Good points about this analysis: (1) It uses the Mergent financial ratio data that are available from the Library database; (2) The ratios are presented in a table, which is numbered and titled; (3) Several years of ratio data are presented; (4) Actual ratio numbers are used in the written analysis; (5) An effort is made to evaluate the ratio data; and, (6) The ratio analysis is divided into appropriate sub-sections.

Financial Ratio Analysis