Category: Accounting

Comprehensive financial analysis

evaluate students’ understanding and ability in collecting financial data and applying various financial analysis techniques to assess a company’s financial position in order to identify where improvements are needed. In addition, it aims at evaluating students’ ability to apply an appropriate software to prepare and analyse financial statements and to provide recommendations for the selected companies and investors.

provide a comprehensive financial analysis for the selected companies using various financial analysis techniques such as graphs, common-size analysis and financial ratio analysis including DuPont analysis.
Your final report should include the following:
i) Analysing the following aspects of the selected firms’ over two years:
1. Analysing liquidity
2. Analysing assets management efficiency
3. Analysing solvency or leverage
4. Analysing profitability (including DuPont analysis).
5. Analysing market value ratios
ii) Evaluation of the selected firms’ cash conversion cycle (CCC). iii) Common-size analysis.
iv) A description of the overall ratios trend and what it implies for current and future financial performance of the selected companies.

Discuss the main theories on the term structure of interest rates, their differences and similarities.

Discuss the main theories on the term structure of interest rates, their differences and
similarities.
– Various versions of the expectations theory address the behaviour of short-term forward rates. Explain the common hypothesis.
– What are the main types of risks associated with investing in bonds and how do these two risks affect the pure expectations theory?
– Explain the two biased expectations theories about the term structure of interest rates.

Present arguments supporting a decision to accept Tierra Corporation as an audit client.

Tammy Potter, a new partner with the regional CPA firm of Tower & Tower, was recently appointed to the board of directors of a local civic organization. The chairman of the board of the civic organization is Lewis Edmond, who is also the owner of a real estate development firm, Tierra Corporation.

 

Potter was quite excited when Edmond indicated that his corporation needed an audit and he wished to discuss the matter with her. During the discussion, Potter was told that Tierra Corporation needed the audit to obtain a substantial amount of additional financing to acquire another company. Presently, Tierra Corporation is successful, profitable, and committed to growth. The audit fee for the engagement should be substantial.

  1. Present arguments supporting a decision to accept Tierra Corporation as an audit client.

 

  1. Present arguments supporting a decision not to accept Tierra Corporation as an audit client.

 

  1. Assuming that you are Lee Tower, set forth your decision regarding acceptance of the client, identifying those arguments from part (a) or part (b) that you found most persuasive.