1. Obtain the most recent annual report for two public companies in the high-tech industry. These reports can be downloaded from SEC or many other sites on internet (See appendix 2 in this document). These reports are publicly available. The reports should contain at least three years of income statement data and two years of balance sheet data.
2. Analyze at least 3 (three) items on the income statement for your base company that would be important to an investor, and discuss whether your companys performance related to these items appeared to be improving, deteriorating, or remaining stable. You can perform ratio calculations and do your analysis based on the ratios. Justify your answer.
3. Analyze at least 3 (three) items on the balance sheet for your base company that would be important to an investor, and discuss whether your companys performance related to these items appeared to be improving, deteriorating, or remaining stable. You may perform balance sheet ratios analysis. Justify your answer.
4. Analyze your base companys investing and financing activities for the most recent year as identified in the statement of cash flows, specifically identifying the two largest investing activities and the two largest financing activities. Discuss whether you agree or disagree with the investing and financing strategies that your company appears to be employing.
5. Identify 2 (two) items not included in (or derived from) the financial statements that you think would be important to someone considering whether to invest in your company. Discuss your reasons for believing that these two items about the company would be important in making an investment decision. (Hint: you might want to consider items discussed in the textbook or other business courses)
6. Compare your base companys financial statements with those of the second company in the high-tech industry. If you were making a decision to invest in one of the two companies, which company would you choose? Why? (Note: your answer in this section must include some financial issues, but your answer need not be limited to a discussion of financial issues.)
1. You must submit the entire annual report for each company being discussed.
2. Your analysis must include page references to relevant portions of the annual reports, and the relevant portions of the annual reports must be highlighted. Your report must also contain appropriate quotation marks for quoted material and appropriate citations for material taken from sources outside the financial statements.
3. Your analysis is limited to 6 (six) pages, and must be typed, double-spaced, and have at least a 10-point font.
4. The assignment is due on the date specified in the syllabus.
5. This is not a group project and you must perform the work individually.
Appendix 1: Grading Rubric:
First, the projects will be reviewed for compliance with the basic requirements and for composition. Any projects submitted without the entire annual reports for both companies being discussed, without appropriate page references to the relevant portions of the annual reports, without appropriate highlighting of the relevant portions of the annual reports, without appropriate citations for material taken from sources outside the annual reports, and/or with excessive composition errors will lose 20% points.
Second, the papers will be reviewed for content and will be graded using the following rubric
180 to 200: The paper is well written, free of grammatical and other writing errors, and well organized. The report addresses each of the issues specified in the requirements, uses appropriate examples to illustrate concepts discussed, and integrates the annual report data with the narrative. The report focuses on important items, demonstrates a thorough understanding of the relationships among financial statement data, and is cohesive.
150 to 179 points: The paper generally is well written but may have minor grammatical or other writing errors or lack smooth transitions. The report addresses the issues specified in the requirements, demonstrates understanding, and focuses mainly on important items, but does not fully synthesize the material being discussed, and/or does not integrate the annual report data with the narrative.
120 to 149 points: The paper does not have excessive grammatical or other writing errors. The report addresses the issues specified in the requirements, but demonstrates only moderate understanding, and/or lacks integration.
100 to 119 points. The paper does not have excessive grammatical or other writing errors. The report addresses the issues specified in the requirements, but demonstrates only minimal understanding of one or more of the issues.
70 to 99 points. Due to failure to comply with the basic requirements, excessive composition errors, or failure to demonstrate understanding of two or more of the issues required to be discussed.
50 to 99 points. The paper fails to meet the basic requirements, has excessive composition errors, and/or fails to demonstrate understanding of two or more of the issues required to be discussed after a first resubmission. No submission will receive a zero.
Appendix 2: FINDING ANNUAL REPORTS
You are required to turn in a copy of both companies annual reports with this project. The best way to obtain annual reports is to request them directly from the company. You may find a companys contact information on its website (usually in an SEC Filings or Investor Relations/Information tab).
Annual reports are also available on the SEC website, http://sec.gov/, and through the university library website using either the S&P Market Insight or Lexis-Nexis databases.