TJX Accounting Project
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tjx_accounting_project_.xls1. Cover page
| ACG 3101 INTERMEDIATE ACCOUNTING I |
| Summer Semester 2015 |
| Financial Reporting and Analysis Project |
| Objectives |
| The objectives of the financial reporting and analysis project are twofold: |
| The first objective of the project is to allow you the opportunity to experience “live” financial information. Real financial statements and related information often use terminology that is unfamiliar and present information somewhat differently, and in a more complex fashion, than what is illustrated in your textbook. This project is also designed to increase your ability to apply the lessons of your accounting course to actual financial statements. |
| The second objective of the project is to give you the opportunity to familiarize you with some of the common sources of business and financial information. Employers expect that you are able to quickly and accurately obtain relevant information about suppliers, customers, competitors, as well as, its industry. To effectively complete this assignment you are required to consult information contained in the company’s annual report (e.g., financial statements, footnotes, management discussion and analysis, letter to shareholders, auditor’s opinion/report) |
| GUIDELINES FOR SUBMISSION OF PROJECT |
| You are required to prepare a thorough financial analysis, including an exhaustive search of information sources. |
| Consider all relevant information. Use financial statements, notes, financial press releases, financial analyst conference calls and reports, ratios, comparative techniques, industry information and other financial analysis tools to fully answer the questions provided on the following worksheets. You are expected to exhibit a theoretical understanding of accounting and business concepts, and to address the issues and financial information and highlights relevant to the company and its industry. |
| Indicate the footnote (if applicable) and page in the annual report, Form 10-K, Form 10-Q, etc. from which the information was obtained and HIGHLIGHT THE RESPECTIVE INFORMATION. |
| Insert Students Name Here |
| Insert Company Name Here |
| Insert Submission Date Here |
2. Annual Report
| Overview of the Annual Report | ||
| The following questions should be answered using information provided for the most recent Annual Report | ||
| Answer | Page # | |
| Answer the following questions. Indicate the page number(s) where the information is located. | ||
| Date of the end of its fiscal period | ||
| Locate the following items/information, READ and indicate the page number (s) where the information is located. | ||
| Board of Directors | ||
| Chairman’s letter to shareholders | ||
| Financial summaries (usually 5-10 years) | ||
| Management’s discussion of current year results | ||
| Management’s statement of responsibility for the financial statements | ||
| Report of independent auditors on the company's internal controls | ||
| Report of independent auditors on the company's financial statements | ||
| Management's discussion of the risk factors that may impact the company | ||
| Using the most recent annual report, answer the following questions. If applicable indicate the financial statement (FS), footnote number where the information is listed. Also indicate the page number(s) where the information is located. | ||
| Who is the Chairman of the Board? | ||
| Was Management pleased with the company's financial position and results of operations for the year? | ||
| Which FS provides information about the results of the company's current operations? | ||
| Which FS provides information about the company's financial position? | ||
| Name of the accounting firm that conducted the audit and issued the opinion letter? | ||
| What type of audit opinion did the company receive on its internal controls? | ||
| What type of audit opinion did the company receive on its financial statements? | ||
| How long after the company’s year-end did the auditors issue their opinion. | ||
| Does it appear that the company’s internal controls are adequate? | ||
| Who bears primary responsibility for the financial statements? | ||
| Number of notes to the financial statements |
3. Disclosures
| Accounting Policies and Corporate Disclosures | ||
| Using the most recent annual report (and most recent yearend), answer the following questions. If applicable indicate the financial statement (FS), footnote number where the information is listed. Also indicate the page number(s) where the information is located. | ||
| Answer | Page # | |
| Fill in appropriated dollar amounts: | ||
| Probable future economic benefits (total) | ||
| Creditors' claims (total) | ||
| Owners' Claims (total) | ||
| Fill in appropriated dollar amounts: | ||
| Revenues + Gains | ||
| Total Expenses + Losses | ||
| Net Income (Net Loss) | ||
| Did the company adopt any new accounting standards (e.g., FASBs) this year? | ||
| Is the company involved in any lawsuits or investigations? If Yes, does the company's management expect that the litigations will have a material impact on the company. | ||
| When does the recognize revenue from the sales of merchandise at the register? | ||
| When does the company recognize revenue earned from the sales of merchandise sold online? | ||
| When does the company recognize revenue earned from the sales of merchandise sold via catalogue? | ||
| When does the company record income from gift cards? | ||
| What method does the company use to determine its inventory and cost of goods sold? | ||
| What method(s) does the company use to calculate its depreciation? | ||
| What method does the company use to determine its bad debt expense? |
4. Statements-1
| Overview of the Financial Statements | ||
| The following questions should be answer using information provided for the most recent year end. If applicable indicate the financial statement (FS), footnote number where the information is listed. Also indicate the page number(s) where the information is located. | ||
| Answer | Page # | |
| What is the cost attributed to the use (expired cost) of long-lived assets as of the end of the fiscal year? | ||
| What is the amount of inventory available for sale at end of year? | ||
| What is the most significant asset? | ||
| What is the most significant obligation? | ||
| What is the amount that the company expects to collect from customers during the next year? Does this amount represent what the customers owe the company? Why or why not? | ||
| Does the amount above respresent what the customers owe the company? , If NO, what is the amount that is due to the company from its customers? | ||
| List the account and amount that include expenses that have been incurred, put yet to be paid. | ||
| What is the amount of asset available held for resale to customers at the end of the year? | ||
| How much does the company does the estimated that it will not collect from customers? | ||
| What is the book value of the company’s long-lived tangible assets used in operations? | ||
| What is the most significant long-lived tangible asset used in operations? Specific the amount. | ||
| What is the book value of the company’s intangible assets other than Goodwill? | ||
| What is the most significant intangible asset (other than Goodwill) used in operations? Specific the amount. | ||
| Overall, has cash increased or decreased over the two most recent periods? | ||
| What is the net change in cash from beginning of period to end of period? | ||
| What is the amount of cash provided (used) by operations? | ||
| What is the amount of cash provided (used) from the sale (purchase) of long-term assets |
5. Statements-2
| Overview of the Financial Statements | ||
| The following questions should be answer using information provided for the most recent year end. If applicable indicate the financial statement (FS), footnote number where the information is listed. Also indicate the page number(s) where the information is located. | ||
| Amount | Page # | |
| What is the amount owed to suppliers at the end of year? | ||
| What is the cost of the merchandise sold to customers during the fiscal year? | ||
| What is the amount of the warranty obligation at the end of year? | ||
| What is the amount of the company’s obligations that will be paid during the next year | ||
| What is the amount of the company's long-term obligations that will be paid during 2011? | ||
| What is the amount of the company’s debt paid during the year? | ||
| What equity accounts are included on the company’s balance sheet? | ||
| What amount of the owner’s residual interest in the company? | ||
| What is the amount of the company’s earnings that were paid to the owners? | ||
| What is the amount of cumulative earnings that were not distributed to the owners? | ||
| What is the amount of cash received from the sale of the company’s own stock this year? | ||
| What is the amount of cash used to acquire plant assets during the year? | ||
| What is the amount of cash received from the disposition of plant assets during the year? | ||
| What is the amount paid to reacquire the company’s own stock during the year? | ||
| What is total amount of resources earned from the company’s main on-going activities year? | ||
| What is the cost of the efforts expended to earn the resources during the year (amount)? | ||
| What is the amount of income did the company earn from incidiental (side) activities? | ||
| What is the amount of expense did the company incur from borrowing money from financial institutions? |
6. Statements-3
| Overview of the Financial Statements | ||
| The following questions should be answer using information provided for the most recent year end. If applicable indicate the financial statement (FS), footnote number where the information is listed. Also indicate the page number(s) where the information is located. | ||
| Answer | Page # | |
| Did the company acquire another entity during the fiscal year? | ||
| If the company acquired another entity, what is the name of the entity? | ||
| If the company acquired another entity, how much did the company pay to acquire the particular entity? | ||
| Did the company sell any of its subsidiaries during the fiscal year? | ||
| If the company sold any of its subsidiaries, what is the name of the subsidiaries sold? | ||
| If the company sold any of its subsidiaries, how much did the company receive from the sale of the subsidiaries? | ||
| If the company sold one of its subsidiaries, what is the amount of the gain/loss from the sale of the subsidiary? | ||
| Use the information provided in the balance sheets and statement of cash flows to compute the historical cost of equipment and reconcile it to the equipment’s net balance (book value) for the most recent two years. | ||
| By rearranging the cost of goods sold (cost of sales) formula, you can solve for inventory purchase, which are not disclosed. Show how to compute the company’s purchases during the current year. Examine the company’s note titled Inventories, Merchandise Inventory or similar item. If the company discloses several categories of inventories, including a similar to Finished Goods, use the beginning and ending balances of Finished Goods for the computation of purchases. If only one category of Inventories is disclosed, use these beginning and ending balances. | ||
| Is the company's prepaid expenses disclosed on the financial statements. If No, do you think that the company has any deferred expenses. | ||
| If you think that the company has deferred expenses, however, they are not disclosed separately on the financial statements, specific the account/line item and amount that includes these items. | ||
| If the company had three certificate of deposit that can be withdrawn on demand. Where would this amounts likely reported, be specific, identify the account/line item and identify the specific amount that includes thes iteems. | ||
| Are the company's investments in securities of other entitys disclosed separately on the financial statements. If No, do you think that the company has any investments. | ||
| If you think that the company has any investment, identify the account/line item that includes this item. | ||
| How much of the cost of the company’s tangible and intangible long-lived assets were allocated as used up during year? Many income statements embed this amount in "other". To learn the actual amount, it is often necessary to examine the Statement of Cash Flows. | ||
| Are the company’s research and development expenses disclosed separately on the income statement or notes. If they are not disclosed, do you think your company incurs R&D costs? | ||
| If you think that the company has research and development expenses, however, they are not disclosed separately on the financial statements, specific the account/line item and amount that includes these items. |
7. Footnotes
| Accounting Policies and Corporate Disclosures | |||
| Using the most recent annual report (and most recent yearend), answer explain the relevant's of each he company's footnote disclosures. In addition, relate the footnote to the respective financial statement account/line item. | |||
| Footnote # | Footnote Title | Brief Explanation | Applicable FS Account/Line Item |
8. Ratios
| Financial Ratios | ||||
| The following questions should be answered using information provided for the most recent year end. Please provide calculations. | ||||
| Formula | Prior Year | Current Year | Analysis (in lay terms) | |
| For the most recent annual period, compute the following operating performance measures for your company:A4 | ||||
| Current ratio | ||||
| Quick ratio | ||||
| Current cash debt coverage ratio | ||||
| Receivable turnover | ||||
| Inventory turnover | ||||
| Asset turnover | ||||
| Profit margin on sales | ||||
| Rate of return on assets | ||||
| Rate of return on share capital - ordinary | ||||
| Earnings per share - basic | ||||
| Price-earnings ratio | ||||
| Payout ratio | ||||
| Debt to total assets | ||||
| Debt to equity ratio | ||||
| Rate of return on assets | ||||
| Cash debt coverage ratio | ||||
| Times interest earned | ||||
| Free cash flow | ||||
| Book value per share | ||||
| Current stock price |
