Project ACG2021 Sp08



ACG2021: Fall 2014

COURSE PROJECT – INSTRUCTIONS

PROJECT REQUIREMENTS:

1. Each group must select from one of the following companies:



RadioShack

Kellogg Co

2. Students will download documents including the most recent:

• Quarterly report (Form 10-Q)

• Proxy statement (DEF-14A)

• Annual report (Form 10-K)

Note that you only need the Executive Compensation table from the Proxy Statement (DEF 14A).

Students can download the company filings from the SEC EDGAR (“electronic data gathering and analysis”) database.

Here is how to download the company filings:

Go to the Securities and Exchange Commission home page () select ”Search for Company Filings” to go to the EDGAR database. Select “Companies and Other Filers” and enter the company name.

3. Students must use the internet to find the daily closing stock price and the number of shares traded for the common shares of their company and plot the last 12 months for both. A useful site is to obtain this information is: . Select “Chart” and enter the ticker symbol in the “symbol lookup”. Select “Historical Quotes: daily” at the bottom of the page. The historical prices are shown, with an option to download to a spreadsheet at the bottom of the page.

Download the daily closing prices and volume of shares traded into a spreadsheet (e.g. Excel). Use the graph function to plot the PRICES and SHARES traded each day into two charts. You must prepare the charts yourself to receive full credit. Copying an existing graph is not acceptable. The last page of this handout provides an example of the two charts.

4. The course project will be completed in two parts. For Part I student answer the questions shown on the form provided below. In addition to the questions, student will submit the following materials for Part I:

• Two charts: daily closing stock prices and number of shares traded each day for the last twelve months

• A copy of the Executive Compensation Table from the proxy statement (DEF 14A)

• Copy of the balance sheet, income statement and statement of cash flow on Form 10-Q.

5. For Part II student answer the questions shown on the form provided below and prepare a memo. The memo must be type written, using one-inch margins, single spacing and 12 point font. In addition to providing answers to the questions, students will submit the following materials for Part II:

• Memo to potential investors and

• Copy of the balance sheet, income statement and statement of cash flow on Form10-K.

6. Additional administrative requirements:

• Do not turn in this page.

• Fasten loose pages and documents together.

• Keep a copy of your reports as a precaution.

ACG2021: Fall 2014

COVER PAGE: PART I

PART I ( You need Form 10-Q and Proxy Statement for Part I)

Student information

Student Names

Panther ID

Class information:

Section No. ( )

1. Corporation information

a. Name of corporation / Internet Address

b. Principle product or service

c. Stock market on which shares are traded

d. Price of a common share on date of this project

e. Number of shares traded on date of this project

2. Industry

a. What is the chief industry of the firm?

b. List a few competitors

_________________________________________________________________

c. Is the industry a growth or a mature industry? Why?

3. Management information

a. Name of chief executive officer (CEO)

b. Name of chief financial officer (CFO)

c. Total Compensation for most recent year for CEO

4. Quarterly Reports

a. Balance Sheet date of quarterly report

b. Total Revenue

c. Net Income

d. Net Cash flow Increase (decrease)

Part I: Don’t forget to attach:

• Graphs: Daily stock closing prices and volume of shares traded for the last twelve months

• Annual compensation table from the proxy statement (just attach a copy of the compensation table)

• Copy of the balance sheet, income statement and statement of cash flow on Form 10-Q.

ACG2021: Fall 2014

COVER PAGE: PART II

PART II (You need Form 10-K for Part II)

Student information

Student Names

Panther ID

Class information:

Section No. ( )

1. Auditor information

a. Name of audit firm b. Date of auditor’s report_____________

2. Annual financial statement information

a. Dates of financial statements (Balance Sheet dates)

b. Number of years covered (Income Statements)

3. Analysis of the balance sheet

a. Total assets ($)

b. Total liabilities ($)

c. Inventory flow assumption

d. Depreciation method

4. Ratio analysis (Please include the formula and the calculations)

a. Primary (Basic) earnings per share

b. Current ratio

c. Working Capital

d. Return on assets

e. Return on equity

f. Debt to equity

5. Analysis of the cash flow statement

a. Was there a net cash inflow or outflow? Include dollar amount.

b. Where did the firm primarily spend cash? (give three examples)

c. From where did this cash come? (give three examples)

ACG 2021: Fall 2014

COVER PAGE: PART II

6. Analysis of risk

List some economy and industry-wide risk factors

7. International

a. Does the firm have significant foreign sales?

b. Does the firm have significant foreign suppliers?

c. With what countries does the firm have significant business relations?

d. Is the firm vulnerable to currency fluctuations?

8. Would you rate this company as a “BUY”, “SELL” or “HOLD”?

9. On a separate page, prepare a type-written memo to potential investors (approximately 400 words) summarizing your analysis of the firm. Be sure to support the position you take in question 8.

You may use the following assumptions when writing your memo:

• The reader does not know a lot about the company you are analyzing, so a brief explanation of the business would be helpful.

• The reader has a general but limited understanding of accounting and financial statement analysis – therefore, when discussing ratios, etc. it would be beneficial to explain why you used a specific ratio or the purpose of the ratio, not how the ratio is calculated.

• The majority of the memo should focus on your analysis – remember, analysis should provide insight, a list of numbers without explanation is meaningless e.g. ask yourself…What does this number mean? Why am I including this result in my memo? Is the result favorable? Unfavorable?

• In addition to content, you will be graded on your writing skills including grammar and appropriate language.

• Be sure to cite any resources used.

Part II: Don’t forget to attach:

• Memo (Question 9). Memo must be type-written, single spaced and 12 point font.

• Copy of the balance sheet, income statement and statement of cash flow on Form10-K.

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