Please use the 2014 Annual Report of Apple Inc. for statistics, financial information. The other attached annual reports
(2012-2013) can be used for comparison over the years.
APA FORMATTED FINANCIAL ANALYSIS REPORT (8–10 PAGES body length) organized as follows:
• Company overview
• Name of CEO/CFO
• Location of the corporate/home office
• Ending date of latest fiscal year
• Description of the main products/services that the company provides
• Main geographic area of activity
• Name of company’s independent auditors. Explain what the auditors said about the company’s financial statements.
• The most recent stock price and its dividend per share. Include the date for this information.
b. Financial Statements
• Discuss the major financial statements in detail. What formats are used? What significant trends (over three
years) can you find? What is the future forecast, or what do the pro forma statements indicate?
c. Accounting Policies
• What are the significant accounting policies relating to revenue recognition, short-term investments, cash,
inventories, and property and equipment? What are some of the major topics of the disclosure notes to the statements?
• Provide a brief summary of the Management Discussion and Announcement (MDA) section.
• Discuss key internal controls, business processes, and transactions.
d. Financial Analysis
• FOR THE PAST THREE YEARS,CALCULATE AND DISCUSS the importance of the following ratios:
o Liquidity Ratios—working capital, current ratio, quick/acid-test ratio, receivable turnover, average day’s sales
uncollected, inventory turnover, average day’s inventory on hand, operating cycle
o Profitability Ratios—profit margin, asset turnover, return on assets, debt-to-equity ratio, return on equity
o Long-term Solvency Ratios—debt-to-equity ratio, debt to total assets, times interest earned, cash debt coverage
o Cash Flow Ratios—cash flow yield, cash flows to sales, cash flows to assets, free cash flow
o Market Strength Ratios—Earnings per share, price-earnings per share, payout ratio, book value per share
• Also, include an overview of the company’s operating segments and divisions/subsidiaries, if applicable.
• As you completed the financial statement process and analysis for a publicly traded company, what was the most
beneficial finding? What part of this exercise did you find most interesting?
• How would you present your interpreted results of financial statements to your chosen company’s stakeholders
(stockholders, employees, customers, etc.)? What key metrics would you highlight and why?