Common-size balance sheet and income statement, Financial Management

Assignment Help:

The question to be answered is : "Since the 1990 opening of stock exchanges, China started to use financial statements to determine the performance of listed companies. What were company C's performance from 2002 to 2004 and the quality of reported earnings?"

Need a detailed analysis including ratio and trend analysis. The ratio chosen must obviously relate to the trends observed - I don't need a full analysis with all the ratio, just the ones you think are relevant to what you can see from the statements. The entire analysis also needs to be done in the context of the article attached.

In terms of the part of the question that ask about the quality of reported earnings, I think that it has to do with the fact that the company applied aging method for its accounts receivable throughout 2002 and 2004, but in year 2004, it set aside Rmb2,597m as a special bad debt allowance. Because there aren't any notes attached regarding their accounting policies/ definitions etc...

Q1:  Common-size balance sheet and common-size income statement

Q2:  The change of accounting policy for accounts receivable, with a focus on 2002 through 2004 Apex.

Aging Groups

Rate

Amount

Allowance

 

 

Within 1 Y

0%

1223

0

0

0

1-2Y

10%

3520

2567

352

0.7

2-3Y

30%

34

32

10.2

0.9

3-4Y

50%

3

2

1.5

1.5

4-5Y

80%

 

 

0

0

Over 5Y

100%

5

5

5

5

Total

 

4785

2605

368.7

8.1

Net A/R

 

2180

 

4416.3

 

Schipper (1989) de?nes earnings management as a "purposeful intervention in the external ?nancial reporting process, with the intent of obtaining some private gain (as opposed to say, merely facilitating the neutral operation of the process)".

Earnings management can be defined as the adjustment of a firms' reported economic performance by insiders either to mislead some stakeholders or to influence contractual outcomes.

 


Related Discussions:- Common-size balance sheet and income statement

Difference between pay-as-you-use and pay-as-you-go methods, Question 1: ...

Question 1: (a) Explain fully the difference between ‘Pay-As-You-Use' and ‘Pay-As-You-Go' methods of financing infra-structural projects. (b) Write short notes on any ONE of

Explain compound value of an annuity, Q. Explain Compound Value of an Annui...

Q. Explain Compound Value of an Annuity? Compound Value of an Annuity: - Annuity demotes to the periodic flows of equal amounts. FV = A {(1+i)n - 1}/i Instance: - Mr. X i

Consistency in accounting, Consistency - ACCOUNTING postulate that stipulat...

Consistency - ACCOUNTING postulate that stipulates, except as otherwise noted in FINANCIAL STATEMENT, same accounting procedures and policies have been followed from period to peri

Constructing the binomial interest rate tree, The fundamental princip...

The fundamental principle is that when a tree is used to value an on-the-run issue, the resulting value should be arbitrage free i.e., it should be equal to the o

Determining the call option value, The effective maturity of a ...

The effective maturity of a callable bond can be anywhere between the first call date and its maturity date due to the presence of the call feat

Fiancial management, Ashok is to receive an amount of Rs. 15,00,000 from hi...

Ashok is to receive an amount of Rs. 15,00,000 from his relative after 3 years. He wants to buy a house for which he wants the money to be paid now. His relative had al

Finance, Ask questiSuggestion regarding Credit limit. Should it be approved...

Ask questiSuggestion regarding Credit limit. Should it be approved or not, what should be the amount of credit limit that electronics give to Booth Plastics.

Risk of the complete portfolio, (a) Presume we have a portfolio of n name...

(a) Presume we have a portfolio of n names with some default correlation ρ . The risk of the complete portfolio moves according to the change in default correlation. Alternative

L.P Program, LP Problem, Financial Management Max Z = 107x1+x2+2x3 Subject ...

LP Problem, Financial Management Max Z = 107x1+x2+2x3 Subject to 14x1+x2-6x3+3x4=7 16x1+x2-6x3 3x1-x2-x3 x1,x2,x3,x4 >=0

Explain the term- quality of decisions, Explain the term- quality of decisi...

Explain the term- quality of decisions Performance and business risk This is focussed on " quality of decisions ". The comparison of an organisations performance with t

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd