OMM 622 Week 1 Assignment 1.docx

Once the purpose of an annual report is established

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come before the more detailed analysis known as the form 10-K. Once the purpose of an annual report is established, one can begin to truly delve into the significance of a form 10-K. Take a look at Ford Motor Company’s form 10-K for 2012. It is attached as part of the organization’s annual report. While the company included four parts to this report, only three of them are unquestionably imperative to review when making decisions that involve both staying ahead of competitors and improving their own financial results in accordance with the company’s strategic goals and objectives. The first part, which outlines basic business operations, discusses the history and standard operating procedures of a company. It includes four items which relay things such as risk factors, any new findings on comments that went unsolved in the last report, and ongoing legal proceedings. Upon review of an annual report, one will notice that is does not include information about the background of a business. However, Ford’s form 10-K clearly defines the business of an organization. For example, item 1 states, “We acquired the business of a Michigan company, also known as Ford Motor Company, which had been incorporated in 1903 to produce and sell automobiles designed and engineered by Henry Ford (Ford Motor Company, 2014). As it was mentioned earlier, the annual report looks to make any positives the focal point of discussion with hopes to promote successes while simultaneously burying their failures; However, the form 10-K (audited by an approved accounting firm) highlights both the positives and negatives which ultimately provides shareholders with an accurate and complete look at an organization’s financial results making it easier to compare and improve for the years that will follow. Part two of the form 10-K is generally used to discuss an organization’s financial data. Here, companies like Ford use four items to explain things such as stock holdings, financial statements, and disagreements with the accountants. While a great deal of the annual report
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4 FORD includes information about a company’s financials, the form 10-K is composed of financial data that is both good and bad. Epstein (2014) states, “Companies will usually offer pro forma financial statements that highlight the past five years, but the information will not be as complete as the Form 10-K. This part of the annual report usually conveys only the good news” (p. 23).
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  • Spring '14
  • Ford Motor Company, U.S. Securities and Exchange Commission

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