Essay about My Company Case

Submitted By Christinamhernandez
Words: 3078
Pages: 13

UNIVERSITY OF CALIFORNIA, IRVINE

EMBA 2016

ACCOUNTING
SUBMITTED TO MORTON PINCUS

MY COMPANY CASE:

Submitted by: Christina Hernandez

TABLE OF CONTENTS

A. Overview

1. Company name, location and headquarters, and locations of its primary operations……………………………………………………………….

2. Where in the life cycle is the company…………………………………….

3. An overview using Walmart’s financial reports:

a. Core activities, Walmart’s main focus…………………………..

b. Walmart’s primary goals and the main strategy they pursue to achieve the goals ……………………………………………………..

c. Walmart’s primary opportunities and risks associated with their goals and strategies…………………………………………….

4. What industry is Walmart in? Are they an industry leader?

B. Trend Analysis of Sales and Earnings Growth

1. Revenue growth: Was Walmart’s revenue growth consistent or inconsistent over the 5-year period?
Were there signs of acceleration or deceleration in its recent growth rates? How does Walmart’s revenue growth compare to the industry averages? Will the revenue trends over the past few years continue over the next two to three years?.................................................................

2. Operating income: Has operating earnings grown at the same rate, faster, or slower than revenues?
What factors account for the trend?................................................

3. Net income: Has net income grown at the same rate, faster, or slower than revenues? What factors account for the trend?............................................................................................

C. Analysis of Operating Efficiency, Liquidity, and Solvency

1. Operating efficiency: Receivables, inventory, and total asset turnover ratios. What do the values of the turnover ratios reveal about Walmart?............................................................

2. Liquidity: What is the current ratio, quick ratio, and cash from operations ratio? What do the liquidity ratios reveal about Walmart? How does
Walmart compare to its industry averages for
Liquidity ratios?

3. Solvency: Debt-to-equity, times interest earned, and ROE. Values of solvency ratios and conclusion regarding Walmart’s ability to service its debt and its risk of future insolvency. Does the conclusion change if off balance sheet debt is included? Nature of off balance sheet debt and the estimated amount of off balance sheet debt that Walmart has as of the end of this fiscal year?

D. Analysis of Cash Flows

1. During the past 3-fiscal years, Walmart’s two largest sources of cash. Walmart’s two largest uses of cash?

2. For the past 3-fiscal years, has Walmart’s cash flows from operations (CFO) been adequate to fund its growth initiatives? If not, how has Walmart funded the shortfalls in CFO to obtain growth?

3. Based on the cash flow statement, has Walmart been driven by organic growth or by acquisition?

4. If Walmart continue to grow at its recent rate, does it appear that its CFO can fund this growth?
If CFO is not sufficient, how (and why) would you recommend that Walmart fund its future growth?

5. During the past 3-fiscal years, what dollar amount of common stock (or general, ownership rights) did Walmart repurchase and/or what dollar amount of dividend did it pay? Why did Walmart repurchase its own stock and/or pay a dividend?
Or, if it did not do either, why did it not repurchase its shares and/or pay a dividend? Has Walmart’s strategy with regard to share repurchases and dividends changed uring the past few years?
If so, how and why did it change? If Walmart does not have shares outstanding, did it pay-off substantial amounts of debt during the past 3-fiscal years? If so, why did it do so?

E. Accounting Policies

1. Idenitfy and describe three of Walmart’s most significant accounting policies/issues.

2. Why do I believe each of the accounting policies/issues are important to the company?

3. Does Walmart do a