Purpose and aims:
This assessment task is designed to apply the knowledge and skills developed by you to undertake appropriate vertical, horizontal and ratio analysis on a given set of basic financial statements. Based on this analysis, you are to identify the nature and causes of the trends recognized and make relevant recommendations in a professional context.
Steve Donnie the owner of Mountainous Sporting Co has asked you to prepare a report on the performance of the company for his upcoming appointment with Brad MacDougal. Because of his known friendship with Brad MacDougal, account manager at the Canadian Commercial Bank, Steve thinks that Brad will be especially cautious and vigilant when considering Steve’s loan application. Steve therefore wants to be prepared for any issues which may raise at the interview, after Brad had reviewed Mountainous Sporting Co financial statements as a preliminary to the interview and granting of the requested loan.
Given Mountainarious Sporting Co.’s financial statements for the period 2004 to 2007 you are to undertake appropriate vertical, horizontal and ratio analysis of those financial statements. Based on this analysis, identify the nature and causes of the trends recognized and make relevant recommendations in terms of Mountainarious’ efficiencies in the areas of profitability, liquidity and solvency during this period. Your work and findings are to be communicated in a professional manner in the form of a business report. The business report is to consist of the following sections:
The above table shows the approximate word requirement for each group size; spread over the required business report structure.
Department of Accounting
• The report is to include at least three graphs in the body of the report. If the groupconsists of more than three group members, the num ber of required graphs must equal the number of group members. The graphs must be of a suitable type for the data being presented, properly labelled, and, integrated into the discussion with which the graph is meant to support.
• The report is to be prepared as a group activity. Each group is to consist of three members who need not be in the same seminar. Members need to establish their group on the LMS. Complete the Group Registration Form (available on the LMS) and submit on the LMS. Registration of a group will establish a forum on the LMS limited to those group members for this assignment. The forum can be used as a place of communication and storage of working papers during the drafting of the report. The group will submit a single copy of the report with each group member being awarded the mark determined for the report.
• The report is to include at least three direct quotes from different textbooks; not appearing on the subject’s LMS site. If the group consists of more than three group members, the number of required direct quotes must equal the number of group members. The direct quotes must be integrated into the discussion with which the quote is meant to support and suitable reference using the Harvard style. The library’s Academic Referencing Tool (ART) provides detailed examples of the Harvard style and the Academic Referencing Modules (ARM) to help you understand the principles of referencing.