FSA Course Project Acc 1101 Fall, 1999 Dr. West Each student will choose a publicly traded U.S. company and prepare reports based on the instructions given below. Each student will complete the first two parts individually, and the last part will be a group submission. Accordingly, students will first form groups comprising three members. Next, each group will choose an industry it would like to analyze. Finally, each member of the group will pick a company within the chosen industry. To make your projects interesting, you are urged to pick companies that have been in the news lately. The following is a list of industries you may choose from, and a sample of companies within each industry. The sample of companies is not meant to be exhaustive; you may choose a company outside this list, as long as you obtain the approval of your instructor. Industry (table did not translate properly, sorry) Sample Companies (pick the companies and industries you want) Apparel and Shoes Appliances Nike, Reebok, Timberland Black and Decker, Maytag, Sunbeam, Whirlpool Computers-Major Systems Airlines Hewlett-Packard; Compaq; IBM; NEC; Dell; Apple Delta, USAir, Southwest, Northwest Food Distributors- Supermarkets American Stores, Food Lion, Giant Food, Kroger, Safeway Food, Drink & Tobacco-Processors Chiquita Campbell Soup, General Mills, Kellogg, Quaker Oats, Food Distributors-Restaurant Chains McDonald's, Shoney's, Wendy's, Bob Evans Chemicals Union Carbide, Dow Chem, Dupont, Monsanto, Hercules Pharmaceuticals Pfizer, Merck, Eli Lily, J&J, Smithkline Beecham Retailing-Department Stores Telecommunications Forms Sears, JC Penney, Neiman Marcus AT&T, Lucent Tech, Motorola, Bell Atlantic Standard Register, Wallace, Reynolds & Reynolds, Moore Each group in a class will analyze one industry only, and no two students can choose the same company. Therefore, industries will be assigned on a first-come-first-serve basis. Once you have formed your group, decide which industry you would like to analyze. Submit the following to your instructor: (a) the names of your group members (b) the industry you have chosen, and (c) a second preference for an industry in case your first choice has been taken by a different group. The deadline for submission of group members and choice of industry is 9/1/99. Once each group has been assigned an industry, each group member will pick a company within that industry. The deadline for this submission is 9/8/99. Once your instructor has approved your choice of a company, you will be required to research the company following a series of assignments. The authors of your text provide hot links on their homepage to help you locate information (http://www/swcollege.com/ingram.html) In completing the assignments, each student will: 1) obtain the most recent annual report of your company, including its financial statements and the notes to the financial statements. You will examine the annual report to determine the major financing, investing, and operating activities. 2) locate recent articles that have been written about your company and search the literature to determine information about the economic, social, legal, and political environment of your company and its industry. Articles detailing financing, investing, and operating activities are important 3) work with other members of your group to determine how the performance of their companies compare with that of your company. Part I Introduction (Due date: 10/1) Prepare a report providing basic information about your company. Your report should be two to three pages long, excluding tables or other exhibits (of course, save a copy to your hard drive). Some basic information you should include is: (1) The name of your company; (2) Its top management. (Who is the CEO? CFO) (3) The state in which it is incorporated and date incorporated (4) Nature of the business. (What does it produce? What industry does it belong to? What is its SIC number?) (5) Stock market where its stock is traded (6) Name of its auditors (7) A brief summary of the format of the Annual Report. (How many sections does it have and what do each of these sections cover?) (8) A brief summary of its financial statements. (Does the report contain four statements? What are they called? Does the company provide detailed (e.g. classified) balance sheets and income statements? Is the statement of cash flows prepared using the direct or indirect method? How many years comparative information is provided in its financial statements? When is its financial year-end? How many notes are provided for the financial statements?) (9) Include a Word table summarizing the highlights of the financial statements. Include total assets, total liabilities, total sales revenue, and net income. Part II Recent Articles (Due Date: 11/1) Prepare a report providing a review of the recent literature that has been written about your company and its industry. Your report should be two to three pages long, excluding tables or other exhibits and include at least one article each on a financing activity (borrow or repay), investing activity (build a new plant, open a new office abroad, introduce a new product line), and operating activity (anything but financing and investing). Operating activity does not necessarily make a big splash unless your company has had major layoffs (restructuring), introduced a killer new product, or perhaps put in a new computer system. Part III Comparative trends (Group submission, Due Date: 12/1 or 12/13) Financial Statement Analysis: Prepare a report containing a comparative analysis of your three companies, assessing their (1) liquidity, (2) profitability and stock performance, (3) solvency, and (4) cash flows. This report should be about 2 pages long, excluding tables or exhibits. Use Excel to compute at least ten ratios. Which of the companies do you like best based on your analyses? Why? More guidance and information will be provided as needed throughout the semester. Good Luck.