Financial Analysis-week 2 team

Financial Analysis-week 2 team - Financial Statement...

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Financial Statement Analysis 1 Financial Statement Analysis Team A Brad Austin, Tony Bertussi, Dawn Lazetera, Kim Love, William Tremblay, Jolynn Weeks University of Phoenix John Tripplet ACC 561 February 22, 2011
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Financial Statement Analysis Companies are required to follow specific guidelines when presenting financial data. In the United States, businesses are required to adhere to guidelines set forth by FASB (Financial Accounting Standards Board), while companies abroad are required to follow procedures outlines by the IASB (International Accounting Standards Board). Both the FASB and IASB share common accounting principles and guidelines, with some variation. This paper will examine how each of the industry sectors, retail, manufacturing and service, differ in their accounting measurement conventions, which affect the presentation of financial reporting in adherence to IASB and FASB guidelines. In addition, liquidity, leverage, and profitability ratio computations have been completed and evaluated for the companies selected to analyze performance. Team A has researched three companies from different industries. Boeing is a United States-based manufacturing firm, Sony is a Japanese retailer, and MGM Resorts International is a service provider. FASB and IASB Reporting Overall, the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) have collaborated on most of their functions, yet differences exist. FASB was created in 1973, and replaced both the Accounting Principles Board and the Committee on Accounting Principles. These committees developed the Generally Accepted Accounting Principles or GAAP. “The mission of FASB is to establish and improve standards for financial accounting and reporting, that fosters financial reporting by non-governmental entities that provides decision-useful information to investors and other users of financial reports. That mission is accomplished through a comprehensive independent process that encourages
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broad participation, objectively considers all stakeholder views, and is subject to oversight by the Financial Accounting Foundation’s Board of Trustees. FASB is part of a structure that is independent of all other business and professional organizations. “The FASB standards are officially recognized as authoritative by the Securities and Exchange Commission (SEC) (Financial Reporting Release No. 1, Section 101, and reaffirmed in its April 2003 Policy Statement) and the American Institute of Certified Public Accountants (Rule 203, Rules of Professional Conduct, as amended May 1973 and May 1979). Such standards are important to the efficient functioning of the economy because decisions about the allocation of resources rely heavily on credible, concise, and understandable financial information. The SEC has statutory authority to establish financial accounting and reporting standards for publicly held companies under the Securities Exchange Act of 1934. Throughout its history, however, the Commission’s
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Financial Analysis-week 2 team - Financial Statement...

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