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

INTEREST, Mr. X invests Rs. 10000 at 10% p.a compounded semi-annually. Comp...

Mr. X invests Rs. 10000 at 10% p.a compounded semi-annually. Compute value after three years.

Which banking regulators use in supervising banks, Question 1: In the f...

Question 1: In the financial system, the capital markets consist of the Bond and the Equities Market. Develop this statement. Question 2: (a) Discuss why banking regula

Explain the term - timing of benefits, Explain the term - Timing of Benefit...

Explain the term - Timing of Benefits A more significant technical objection to profit maximisation, as a guide to financial decision making, is that it ignores the differen

What are the ifrs 8 operating segments, What are the IFRS 8 operating segme...

What are the IFRS 8 operating segments IASB issued IFRS 8 operating segments in November 2006 (which replaced IAS 14). This continues IASB's work in its joint short-term conver

Analyse consumer behaviour, Eatmore & Green Pty. Ltd (Australia) is a succe...

Eatmore & Green Pty. Ltd (Australia) is a successful medium sized marketing consultancy for Australian agricultural products and Australian sourced organic, natural beauty/cosmetic

Securitization structure of mortgage backed securities, A mortg...

A mortgage, is sold to the SPV at the discretion of the bank to securitize it into a mortgage backed security, that is, the mortgage is said to

Investing surplus cash, Investing Surplus Cash : Cash not required for temp...

Investing Surplus Cash : Cash not required for temporary periods of short durations can be invested in near-cash assets, i.e. marketable securities which are readily convertible in

Eurodollar, Eurodollar U.S. currency held on deposit in banks located ...

Eurodollar U.S. currency held on deposit in banks located outside the United States, mainly in Europe. Eurodollars are mostly used for settling international transactions outs

Impact of the yield level in bonds, Different bonds trade at differen...

Different bonds trade at different yields though the coupon rate, maturity, and embedded options are same for them. Assuming that all the other bond characteristi

Free cash flow, Free Cash Flow Free cash flow presents the amount of ca...

Free Cash Flow Free cash flow presents the amount of cash generated by the existing operations of a corporation and that is not needed for reinvestment in new projects in the f

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