The Balance Sheet and Corporate Financial Health
Week 3 Assignment – The Balance Sheet and Corporate Financial Health
Overview
A robust financial appraisal of a company’s finances would normally entail the analysis of its cash flow, income statement, balance sheet, and retained earning statements.
In this assignment you focus your analysis on a public company’s balance sheet to evaluate its financial health. The balance sheet represents high-level elements of the other reports, so it provides a good “big picture” view of the company’s finances.
Preparation
Choose a publicly held company and review its 2019 annual report on the Internet. Pay particular attention to the balance sheet upon which this assignment is based.
Instructions
Provide a Web link to the balance sheet of the corporate report that you have chosen.
Evaluate the company’s health by analyzing its balance sheet. Do the following in 4–5 pages:
Evaluate the corporation’s financial health based upon an analysis of each section (assets, liabilities, and owner’s equity) of its balance sheet. Make sure to reference specific items on each sheet and ways that they relate to one another.
Conduct the following tests on the balance sheet (show your results) and explain what each reveals:
Vertical.
Horizontal.
Ratio Analysis. Make sure to compare your ratio with the industry benchmark or other competitors.
Assess the company’s current financial health based the accurate interpretation of findings of the three tests. Include risks in your assessment. Support your conclusions.
Suggest and support three ways to significantly improve the company’s financial health based upon your analysis.