财务会计管理案例分析(英文版)
财务管理案例解析(英文版)(doc 29页)(正式版)
The case study ofSony corporation Members of our group:童士卫财务管理0201 012002019106唐虎财务管理0201 012002019105王小夏财务管理0201 012002019126季春蕾财务管理0202 012002019214张亚茹财务管理0201 012002019131任课老师: 夏新平完成时间: 2005年1月28日一.Background information of Sony1. Sony is founded on May 7, 1946 with the Headquarters Tokyo and Japan.2. Its corporate strategies are becoming a “knowledge-emergent enterprise in the broadband network era”.①Evidenced by recent improvements in network infrastructure,the broadband environment has begun to expand at a rapid pace.②In preparation for the arrival of the full-scale broadband era,Sony is pursuing its vision of creating a Ubiquitous “Value”Network (UVN).3. Its development aspect expanded from the first magnetic taperecorder in1950, to the first "QUALIA" products in 2003, during these years with representative products in each decade: 60th—first tape recorder and transistor70th--video cassette player and headphone stereo Walkman80th--CD player and camcorder90th--high-density disc and DVD playerIn the 21th century-- EL Display and optical disc二. The main operations of the corporation are:①②③④⑤⑥三. The main structure of its sales income1. First is the Electronics:The Electronics segment consists of the following categories: Audio, Video, Televisions, Information and Communications, Semiconductors, Components and Other.The graph shows the information about this: The income is decreasing2. Second is the Game:Game console and software business is conducted by Sony Computer Entertainment Inc.We can see the information from the graph: the income is also decreasing3. Third is the Music:Music business is conducted by Sony Music Entertainment Inc. (SMEI) and Sony Music Entertainment (Japan) Inc. (SMEJ).The graph is showing the basic information: The income is decreasing4. Fourth is the Picture:Motion pictures, television and other businesses are conducted by Sony Pictures Entertainment Inc. (SPE).And also the basic information is from the Graph: The income is increasing5. Fifth is the financial service:The Financial Services segment includes Sony Life Insurance Co. Ltd. Sony Assurance Inc., Sony Bank Inc. and Sony Finance International. Inc.As graph of right show the operating information: The income is increasing6. Sixth is other operating:The Other segment includes an Internet-related business, So-net, which is conducted by Sony Communication Network Corporation, an in-House information system services business, an IC card business and other businesses.With the information in the right graph: The income is increasingThe major Products of Sony①AudioHome audio, portable audio, car audio, and car navigation systems②VideoVideo cameras, digital still cameras, video decks, and DVD-Video players/recorders, and Digital-broadcasting receiving systems③TelevisionsCRT-based televisions, projection televisions, PDP televisions, LCD televisions, projector for computers and display for computers④Information and communicationsPC, printer system, portable information PC, broadcast and professional use audio/video/monitors and other professional-use equipment⑤SemiconductorsLCD, CCD and other semiconductors⑥Electronic componentsOptical pickups, batteries, audio/video/data recording media, and data recording systems四.Sales and Operating Revenue by Geographic Information1. The main market of course is the USA2. It is expand the Europe and other country market ,while decrease theUSA and Japan market ,While seems flat in total market .3. We can conclude Sony is facing a worldwide competition.4. It is changing its business from traditional area to the new area,especially the entertainment market.5. It also need find new market, for example the Asian market, and bringnew product with technology.This is the Segment Information of its sales income6. Developing trend AnalysisFactors which may affect Sony’s fi nancial performance include the following:①market conditions, including general economic conditions, levels ofconsumer spending, foreign exchange fluctuations②Sony’s ability to continue to implement personnel reduction and otherbusiness reorganization activities③Sony’s ability to implement its network strategy, and implementsuccessful sales and distribution strategies in the light of the Internet and other technological developments④Sony’s ability to devote sufficient resources to research anddevelopment⑤Sony’s ability to prioritize capital expenditures, and the success Sony’sjoint ventures and alliances.⑥Risks and uncertainties also include the impact of any future events withmaterial unforeseen impacts.7.The basic financial ratios of Sony from year 2002 to 2004From the above analysis and the table, we can see that:①The liquidity ratio and Acid-test ratio are in a year by year up-trend ,butcombining receivable turnover and inventory turnover, the increase is mainly because of the increase of accounts receivable and the decrease of current liability.②The company accounts receivable turnover and inventory turnover are inup-trend ,this shows that Sony do well in accounts receivable and inventory, so its debt-repay ability and profit abilities will be in advantages.③Its debt ratio is decreasing year by year, so we can see that Sony will have a low financial leverage, its financial environment will be good for its operating④Also, from analysis of the table, Sony’s consolidated sales, operating income, income before taxes, and net income are expected to decrease compared with the fiscal year ended March 31, 2004. While we assume that the yen for the fiscal year ending March 31, 2005 will strengthen against the U.S. dollar and will weaken against the euro⑤Sony’s investments are comprised of debt and equity securities accounted for under both the cost and equity method of accounting. If it has been determined that an investment has sustained an other-than-temporary decline in its value, the investment is written down to its fair value by a charge toearnings.五.Analysis of Sony’s abilitiesThe ability to meet the obligation1.①. From the current ratio, we see that the situation is not good for Sony corporation. Because the median current ratio for the industry is 2.1, but those of Sony is less than this obviously.②. But if we look at the quick ratio, we will find it’s very good: the industry median quick ratio is 1.1, and those of Sony are very near to it.This is because Sony has not as much inventories as other corporations. Then we can see that the ability of Sony to meet short-term obligations is good.For long-term obligations①. The debt ratios are lager than 50%, which indicates that Sony borrows alarge amount of money. Its evidenced by the increasing amount of interest payment.②. Its interest coverage ratios are obviously less than the median of that forthe industry which is 4.0.Then we can see that Sony’s ability to meet the long-term obligationsis not good.2. Assets management analysisFirst, the receivable turnovers are obviously less than the median of 8.1for the industry, which tells us that Sony’s receivables are considerably slower in turning over than is typical for the industry.Second, the inventory turnovers are higher than the median of 3.3 for the industry, which shows Sony has a good inventory management. This is because that inventory is a small portion of assetsThird, the total asset turnovers are obviously less than the median of 1.66 for the industry. So it is clear that Sony generates less sales revenue per dollar of asset investment than does the industry.So Sony’s assets management is not good enough3. Profitability analysis①Sony’s gross profit margin is above the median of 23.8 percent for theindustry, indicating that it is relatively more effective at producing and selling products above cost.②But comparing to the median ROI value of 7.8% and the median ROEvalue of 14.04%, those of Sony are very poor. And this means that it employs more assets and equity to generate a dollar of profit than does the typical firm in the industry.4. Accounts receivable securitization programIn the United States of America, Sony set up an accounts receivable securitization program whereby Sony can sell interests in up to $900 million of eligible trade accounts receivable, as defined. Through this program, Sony can securitize and sell a percentage of undivided interest in that pool of receivables to several multi-seller commercial paper conduits owned and operated by banks. Sony can sell receivables in which the agreed upon original due dates are no more than 90 days. after the invoice dates. The value assigned to undivided interests retained in securitized trade receivables is based on the relative fair values of the interest retained and sold in the securitization. Sony has assumed that the fair value of the retained interest is equivalent to its carrying value as the receivables are short-term in nature, high quality and have appropriate reserves for bad debt incidence. There was no sale of receivables for the fiscal year ended March 31, 2003. Losses from these transactions were insignificant.5. EPS attributable to common stock:Reconciliation of the differences between basic and diluted EPS for the years ended March 31, 2002, 2003 and 2004 is as follows:As discussed in Note 2, the earnings allocated to the subsidiary tracking stock are determined based on the subsidiary tracking stockholders’economic interest.The statutory retained earnings of SCN (the subsidiary tracking stock entity as discussed in Note 15) available for dividends to the shareholders were ¥209 million as of March 31, 2002, which decreased by ¥374 million during the year ended March 31, 2002 after the date of issuance. The accumulated losses of SCN were ¥779 million and ¥1,764 million ($17 million) as of March 31, 2003and 2004, respectively.For the year ended March 31, 2002, 75,201 thousand shares of potential common stock upon the conversion of convertible bonds were excluded from the computation of diluted EPS due to their anti-dilutive effect. 44,603 thousand shares of potential common stock upon the conversion of ¥250,000 million convertible bond issued dated December 18, 2003 were excluded from the computation of the number of weighted-average shares for diluted EPSPotential common stock upon the exercise of warrants and stock acquisition rights, which were excluded from the computation of diluted EPS since they have an exercise price in excess of the average market value of Sony’s common stock during the fiscal year, were 2,665 thousandshares, 4,141 thousand shares, and 6,796 thousand shares for the years ended March 31, 2002, 2003 and 2004, respectively.Warrants and stock acquisition rights of subsidiary tracking stock for the years ended March 31, 2002,2003 and 2004, which have a potentially dilutive effect by decreasing net income allocated to common stock, were excluded from the computation of diluted EPS since they did not have a dilutive effectStock options issued by affiliated companies accounted for under the equity method for the years endedMarch 31, 2002, 2003 and 2004, which have a potentially dilutive effect by decreasing net income allocated to common stock, were excluded from the computation of diluted EPS since such stock options did not have a dilutive effect.On October 1, 2002, Sony implemented a share exchange as a result of which Aiwa became a wholly-owned subsidiary. As a result of this share exchange, Sony issued 2,502 thousand shares. The shares were included in the computation of basic and diluted EPS.6. P/E ratioLet’s see the three year’s data of P/E RatioWe can see that the P/E ratios are large, and if we invest on it, we will need many years to get back our money. So it’s not good to invest on it. 六. Do Pont analysis1. Here I’d like to analysis the effects of all kinds of items, such as ‘Return oftotal assets’ and ‘Equity multiplier’, to ROE.Then, based on thecontributions of the items, we try to find ways to improve the ROE.At the first glance of the table, you will obverse there is so great difference between the ROE of 2002 and the other two year. ---So I decide to analysis that one for example the decrease of the ROE in year 2002 is primarily because of the decrease of other income, increase of costs and expenses and other expenses.Let us go to the “income statement” to see the details------From the ‘income statement’ behind,(1)we can see that the decrease of ‘other income’ is primarily because of the decreaseof ‘foreign exchange gain’ and decrease of ‘marketable security and security sales’.The news behind has shown that the foreign exchange rate has changed so much that the foreign exchange risk is so high ,and the economics in Japanese has fallen down.It is may be one of the reasons of the decrease of ‘foreign exchange gain’中新网香港1月23日消息：尽管亚洲国家对日元继续贬值表示关注，但美国财政部长奥尼尔与日本财务大臣盐川正十郎进行会谈后表态，外汇汇率应由市场决定。
财务管理会计案例教材英文版(ppt 70)
A General Model for Variance Analysis
Actual Quantity ×
Actual Price
Actual Quantity ×
Standard Price
Standard Quantity ×
Standard Price
Price Variance
Quantity Variance
Practical standards should be set at levels
that are currently attainable with reasonable and efficient effort.
Production manager
Setting Standard Costs
or Rate
AxB
Standard Cost
per Unit
Direct materials Direct labor Variable mfg. overhead
Total standard unit cost
3.0 lbs. 2.5 hours 2.5 hours
$ 4.00 per lb. $ 14.00 per hour 3.00 per hour $
Rate Standards
Time Standards
Use wage surveys and labor contracts.
Use time and motion studies for each labor operation.
Setting Variable Overhead Standards
Standard Cost Card – Variable Production Cost
财务管理会计案例教材英文版(ppt 70)
Irwin/McGraw-Hill
Human Resources Manager
© The McGraw-Hill Companies, Inc., 2000
Setting Direct Material Standards
Price Standards
Quantity Standards
Final, delivered cost of materials, net of discounts.
3.0 lbs. 2.5 hours 2.5 hours
$ 4.00 per lb. $ 14.00 per hour 3.00 per hour $
12.00 35.00
7.50 54.50
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc., 2000
Accountants, engineers, personnel administrators, and production managers combine efforts to set standards based on
experience and expectations.
Irwin/McGraw-Hill
财务管理会计案例教材英文版(ppt 70)
Standard Costs
Standard Costs are
Irwin/McGraw-Hill
Based on carefully predetermined amounts.
Used for planning labor, material and overhead requirements. The expected level of performance.
财务管理分析与案例(英文版)(9个ppt)4
-45 -40 -35 -30 -25 -20 -15 -10 -5 0 5 10 15 20 25 30 35 40 45 50 55 Annual Percentage Return
Source: Professor Aswath Damodaran’s website, /~adamordar/New_Home_Page/
13.2%
Long-term corporate bonds
6.1
Long-term government bonds
5.7
Short-term government bills
3.8
Consumer price index
3.2
Irwin/McGraw-Hill
Continued
Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved.
Irwin/McGraw-Hill
Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved.
Chapter 5
Financial Instruments and Markets
Irwin/McGraw-Hill
5-2
TABLE 5-1 Rate of Return on Selected Securities, 1926 - 1998
Security
Return*
Large company common stocks
1999 YearbookTM, Ibbotson Associates,
财务管理分析英文版1
一、判断题(10*2’)( T )1、A company’s return on equity will always equal or exceed its return on assets.一个公司的权益收益率总是大于或等于其资产收益率。
( T)2、A company’s assets-to-equity ratio always equals one plus its liabilities-to-equity ratio.一个公司的资产权益比总是等于1加负债权益比。
( F )3、A company’s collection period should always be less than its payables period.一个公司的应收账款回收期总是小于其应付账款付款期。
( T )4、A company’s current radio must always be larger than its acid-test-radio.一个公司的流动比率一定大于速动比率。
( F )5、Economic earnings are more volatile than accounting earnings.经济利润比会计利润更加变动不定。
( F )6、Ignoring taxes and transactions costs , unrealized paper gains are less valuable than realized cash earnings.若不考虑税收和交易成本，未实现的纸上盈利不如已实现的现金盈利有价值。
( F)7、A company’s sustainable growth rate is the hi ghest growth rate in sales it can attain without issuing new stock.一家公司的可持续增长率是他在不增发新股情况下所能取得的最高的销售增长率。
财务管理会计案例教材英文版70
unattainable and discourage most
employees.
Human Resources Manager
Setting Direct Material Standards
Price Standards
Quantity Standards
First, they point to causes of
I see that there
problems and directions for improvement.
is an unfavorable variance.
Second, they trigger investigations in departments
rate.
The activity is the base used to calculate
the predetermined overhead.
Standard Cost Card – Variable A standard cPorsot dcaurcdtfioornoCneousntit of product
A standard is the expected cost for one
unit.
A budget is the expected cost for all
units.
A SstatnadanrddcaosrtdvarCianocse its Vtheaarmiaounntcbey swhich
But why are variances
having responsibility for incurring the costs.
财务案例英文总结范文
In this case study, we delve into the financial management and analysis practices of a prominent manufacturing company. The company, known for its innovative products and robust market presence, faced several challenges in maintaining financial stability and optimizing its operational efficiency. The following summary outlines the key aspects of the case, including the challenges encountered, the strategies implemented, and the outcomes achieved.Background:The manufacturing company, "Innovatech," operates in a highly competitive industry where rapid technological advancements and market fluctuations are the norm. The company’s financial department was responsible for managing the company’s financial resources, ensuring compliance with financial regulations, and providing strategic financial advice to the management team.Challenges:1. Cash Flow Management: Innovatech faced difficulties in managing its cash flow, which often resulted in short-term liquidity issues. The company struggled to balance its working capital requirements with its long-term investments.2. Cost Optimization: The company was unable to effectively control its operational costs, leading to a reduction in profitability. Identifying cost-saving opportunities without compromising product quality was a significant challenge.3. Financial Reporting: The company’s financial reporting process was time-consuming and prone to errors. There was a need for a moreefficient and accurate system to meet regulatory requirements and provide timely financial insights to the management team.4. Investment Decisions: The management team lacked a comprehensive framework for evaluating investment opportunities, which resulted in suboptimal capital allocation decisions.Strategies Implemented:1. Cash Flow Optimization: The financial department implemented a cash flow forecasting model that allowed the company to anticipate future cash requirements and make informed decisions regarding capital investments and financing options.2. Cost Analysis and Control: A detailed cost analysis was conducted to identify areas of inefficiency. The company implemented cost control measures, such as process improvements and supplier negotiations, to reduce operational costs.3. Financial Reporting Automation: The financial department adopted a new accounting software that automated the financial reporting process, improving accuracy and reducing the time required for financial close.4. Investment Analysis Framework: A structured investment analysis framework was developed to evaluate potential investment opportunities based on financial metrics, risk assessment, and strategic alignment.Outcomes Achieved:1. Improved Cash Flow: The implementation of the cash flow forecasting model resulted in a more stable cash position, allowing Innovatech to meet its short-term financial obligations and invest in long-term growth initiatives.2. Cost Reduction: The cost control measures implemented led to a significant reduction in operational costs, improving the company’s profitability and competitiveness.3. Enhanced Financial Reporting: The new accounting software streamlined the financial reporting process, ensuring accurate and timely financial information for decision-making purposes.4. Optimized Capital Allocation: The structured investment analysis framework enabled the management team to make more informed capital allocation decisions, resulting in improved financial performance and shareholder value.Conclusion:This case study highlights the importance of effective financial management and analysis in driving business success. By addressing the challenges faced by Innovatech, the company was able to optimize its financial performance and achieve sustainable growth. The strategies implemented demonstrated the value of a proactive approach to financial management, emphasizing the need for continuous improvement and adaptation to changing market conditions.。
财务会计管理案例分析(英文版)
Standard quantity is the quantity allowed for the actual good output.
A General Model for Variance Analysis
Actual Quantity ×
Actual Price
Actual Quantity ×
MPV = $170 Favorable
Zippy
Material Variances
The standard quantity of material that should have been used to produce 1,000 Zippies is: a. 1,700 pounds. b. 1,500 pounds. c. 2,550 pounds. d. 2,000 pounds.
Total standard unit cost
3.0 lbs. 2.5 hours 2.5 hours
$ 4.00 per lb. $ 14.00 per hour 3.00 per hour $
12.00 35.00
7.50 54.50
Standards vs. Budgets
Are standards the same as budgets?
Amount
Direct Labor
Direct Material
Standard
Manufacturing Overhead
Type of Product Cost
Setting Standard Costs
Accountants, engineers, personnel administrators, and production managers combine efforts to set standards based on
财务管理案例分析-英文版(doc 10页)
财务管理案例分析-英文版(doc 10页)LAURENTIAN BAKERIESThe decision-maker must make a recommendation on a large expansion project. Discounted cash flow analysis is required.In late May, 1995, Danielle Knowles, vice-president of operations for Laurentian Bakeries In c., was preparing a capital expenditure proposal to expand the company’s frozen pizza plant in Winnipeg Manitoba. If the opportunity to expand into the U.S. frozen pizza market was taken, the company would need extra capacity. A detailed analysis, including a net present value calculation, was required by the company’s Capital Allocation Policy for all capital expenditures in order to ensure that projects were both profitable and consistent with corporate strategies.COMPANY BACKGROUHDEstablished in 1984, Laurentian Bakeries Inc. (Laurentian) manufactured a variety of frozen baked food products at plants in Winnipeg (pizzas), Toronto (cakes) and Montreal (pies). While each plant operated as a profit center, they shared a common sales force located at the co mpany’ head office in Montreal. Although the Toronto plant was responsible for over 40% of corporate revenues in fiscal 1994, and the other plants was accounted for about 30% each, all three divisions contributed equally to profits. The company enjoyed strong competitive positions in all three markets and it was the low cost producer in the pizza market. Income Statements and Balance Sheets for the 1993 to 1995 fiscal years are in Exhibits 1 and 2, respectively.Laurentian sold most of its products to large grocery chains, and in fact, supplying several Canadian chains with private label brand pizzas generated much of the sales growth. Other sales were made to institutional food services.The company’s success was, in part, the product of its management’s ph ilosophies. The cornerstone of Laurentian’s operations was its including a commitment to a business strategy promoting continuous improvement; for example all employees were empowered to think about and make suggestions for ways of reducing waste. As Danielle Knowles saw it: “Continuous improvement is a way of life at Lauremtian.” Also, the company was known for its above – average consideration for the human resource and environmental impact of its business decisions. These philosophies drove all policy-making, including those policies governing capital allocation.Danielle KnowlesDanielle Knowles’s career, which spanned 13 years in the food industry, had included positions in other functional areas such as marketing and finance. She had received an underg raduate degree in mechanical engineering from Queen’s University in Kingston, Ontario, and a master of business administration from the Western Business School.THE PIZZA INDUSTRYMajor segments in the pizza market were frozen pizza, deli-fresh chilled pizza, restaurant pizza and take-out pizza. Of these four, restaurant and take-out were the largest. While these segments consisted of thousands of small-owned establishments, a few large North American chains, which included Domino’s, Pizza Hut and Little Caesar’s, dominated.Approval of a capital expenditure proposal was contingent on three requirements which are illustrated in Exhibit 4. The first of these requirements was the operating division’s demonstrated commitment to continuous improvement (C.I.), the criteria of which are described in Exhibit 5. The second requirement was that all projects of more than $300,000 be included in the Strategic Plan. The final requirement was that for projects greater than $1 million, the operating division had to achieve its profit target. However, if a project failed to meet any of these requirements, there was a mechanism through which emergency funds might be allocated subject to the corporate executive committee’s review and approval. If the project was less than $1 million and it met all three requirements, only divisional review and approval was necessary. Otherwise, approval was needed from the executive committee.The proposed Winnipeg plant project was considered a class 2 project as the expenditures were meant to increase capacity for existing products or to establish a facility for new products. Capital projects could fall into one of three other classes: cost reduction (Class 1); equipment or facility replacement (Class 3); or other necessary expenditures for R&D, product improvements, quality control and concurrence with legal, government, health, safety or insurance requirements including pollution control (Class 4). A project spending audit was required for all expenditures; however, a savings audit was also needed if the project was considered either 1 or 2. Each class of project had a different hurdle rate reflecting different levels of risk. Class 1 projects were considered the most risky and had a hurdle rate of 20%. Class 2 and Class 3 projects had hurdle rates of 18% and 15%, respectively.Knowles was responsible for developing the Winnipeg division’s Capital Plan and completing all AFE forms.WINNIPEG PLANT’S EXPANSION OPTIONSLaurentian had manufactured frozen pizzas at the Toronto plant until 1992. However, after the company became the sole supplier of private-label frozen pizzas for a large grocery chain and was forced to secure additional capacity, it acquired the Winnipeg frozen pizza plant from a competitor. A program of regular maintenance and equipment replacement made the new plant the low cost producer in the industry, with an operating margin that averaged 15%.The plan, with its proven commitment to continuous improvement, had successfully met its profit objective for the past three years. After the shortage of capacity had been identified as the plant’s largest source of lost opportunity, management was eager to rectify this problem as targeted for in the Strategic Plan. Because the facility had also included the proposed plant expansion in its Strategic Plan, it met all three requirements for consideration of approval for a capital project.Annual sales had matched plant capacity of 10.9 million frozen pizzas when Lauentian concluded that opportunities similar to those in Canada existed in the U.S. An opportunity surfaced whereby Laurentian could have an exclusive arrangement to supply a large U.S.-based grocery chain with its private-label-brand frozen pizzas beginning in April, 1996. As a result of this arrangement, frozen pizza sales would increase rapidly, adding 2.2 million units in fiscal 1996, another 1.8 million units in fiscal 1997, and then 1.3 million additional units to reach a total of 5.3 million additional units by fiscal 1998. However, the terms of the agreement would only provide Laurentian with guaranteed sales of half this amount.Knowles expected that there was a 50% chance that the grocery chain would order only the guaranteed amount. Laurentian sold frozen pizzas to its customers for $1.7 in 1995 and prices were expected to increase just enough to keep pace with inflation. Production costs were expected to increase at a similar rate.Laurentian had considered, but rejected, three other alternatives to increase its frozen pizza capacity. First, the acquisition of a competitor’s facility in Canada had been rejected because the equipment would not satisfy the immediate capacity needs nor achieve the cost reduction possible with expansion of the Winnipeg plant. Second, the acquisition of a competitor in the U.S. had been rejected because the available plant would require a capital infusion double that required in Winnipeg. As well, there were risks that the product quality would be inferior. Last, the expansion of the Toronto cake plant had been rejected as it would require a capital outlay similar to that in the second alternative. The only remaining alternative was the expansion of the Winnipeg plant. By keeping the frozen pizza in Winnipeg, Laurentian could better exploit economies of scale and assure consistently high product quality.The ProposalThe expansion proposal, which would require six months to complete, would recommend four main expenditures: expanding the existing building in Winnipeg by 60% would cost $1.3 million; adding a spiral freezer, $1.6 million; installing a new high speed pizza processing line, $1.3 million; and acquiring additional warehouse space, $600,000. Including $400,000 for contingency needs, the total cash outlay for the project would be $5.2 million. The equipment was expected to be useful for 10 years, at which point its salvage value would be zero.The land on which the Winnipeg plant was built valued at 250,000 and no additional land would be necessary for the project. While the expansion would not require Laurentian to increase the size of the plant’s administrative staff, Knowles wondered what portion, if any, of the $223,000 in fixed salaries should be included when evaluating the project. Likewise, she estimated that it cost Laurentian approximately $40,000 in sales staff time and expanses to secure the U.S. contract that had created the need for extra capacity. Last, net working capital needs would increase with additional sales. Working capital was the sum of inventory and accounts receivable less accounts payable, all of which were a function of sales. Knowles estimated, however, that the new high-speed line would allow the company to cut two days from average inventory age.Added to the benefit derived from increased sales, the project would reduce production costs in two ways. First, the new high-speed line would reduce plant-wide unit cost by $0.009, though only 70% of this increased efficiency would be realized in the first year. There was an equal chance, however, that only 50% of these savings could actually be achieved. Second, “other”savings totaling $138,000 per year would also result from the new line and would increase each year at the rate of inflation.Each year, a capital cost allowance (CCA), akin to depreciation, would be deducted from operating income as a result of the capital expenditure. This deduction, in turn, would reduce the amount of corporate tax paid by Laurentian. In the event that the company did not have positive earnings in any year, the CCA deduction could be transferred to a subsequent year. However, corporate earnings were projected to be positive for the foreseeable future. Knowles compiled the eligible CCA deduction for 10 years (see Exhibit 6).For the purpose of her analysis, she assumed that all cash flows would occur at the appropriate year-end.Three areas of environmental concern had to be addressed in the proposal to ensure both conformity with Laurentian policy and compliance with regulatory bodies and local by-laws. First, design and installation of sanitary drain systems, including re-routing of existing drains, would improve sanitation practices of effluent/wastewater discharge. Second, the provision of water-flow recording meters would quantify water volumes consumed in manufacturing and help to reduce its usage. Last, the refrigeration plant would use ammonia as the coolant as opposed to chloro-fluro-carbons. These initiatives were considered sufficient to satisfy the criteria of the Capital Allocation Policy.THE DECISIONKnowles believed that the project was consistent with the company’s busi ness strategy since it would ensure that the Winnipeg plant continued to be the low cost producer of frozen pizzas in Canada. However, she knew that her analysis must consider all factors, including the project’s net present value. The plant’s capital allo cation review committee would be following the procedures set out in the company’s Capital Allocation Policy as the basis for reviewing her recommendation.Knowles considered the implications if the project did not provide sufficient benefit to cover the Class 2 hurdle rate of 18%. Entering the U.S. grocery chains market was a tremendous opportunity and she considered what other business could result from Laurentian’s increased presence. She also wondered if the hurdle rate for a project that was meant to increa se capacity for an existing product should be similar to the company’s cost of capital, since the risk of the project should be similar to the overall risk of the firm. She knew that Laurentian’s board of directors established a target capital structu re that included 40% debt. She also reviewed the current Canadian market bond yields, which are listed in Exhibit 7. The spread between Government of Canada bonds and those of corporations with bond ratings of BBB, such as Laurentian, had recently been about 200 basis points (2%) for most long-term maturities. Finally, she discovered that Laurentian’s stock beta was 0.85, and that, historically, the Toronto stock market returns outperformed long-term government bonds by about 6% annually.EXHIBIT 1INCOME STATEMENTFor The Year Ending March 31($ millions)1993 1994 1995Revenues $91.2 95.8 101.5Cost of goods sold 27.4 28.7 30.5Gross income 63.8 67.1 71.0Operating expenses 52.0 55.0 58.4Operating income 11.8 12.1 12.6Interest 0.9 1.0 1.6Income before tax 10.9 11.1 11.0Income tax 4.2 4.3 4.2Net income 6.7 6.8 6.8EXHIBIT 2BALANCE SHEETFor The Year Ending March 31($ millions)1993 1994 1995Assets:Cash $6.2 9.4 13.1Accounts Receivable 11.3 11.8 12.5Inventory 6.2 6.6 7.0Prepaid expenses 0.3 0.6 2.2Other current 0.9 0.9Total current 24.0 29.3 35.7Fixed assets: 35.3 36.1 36.4TOTAL 59.3 65.4 72.1Liabilities and Sh areholder’s Equity:Accounts payable 7.5 7.9 8.3Other payable 0.7 1.3 2.2Total current 8.2 9.2 10.5Long-term debt 16.8 20.4 24.3Shareholder’s equity 34.3 35.8 37.3TOTAL 59.3 65.4 72.1EXHIBIT 3AUTHORIZATION FOR EXPENDITURE FORMCompany name: business segment:Project title:Project cost(AFE amount):Project cost(gross investment amount):Net present value at %:Internal rate of return: years paybackBrief project description:Estimated completiondate: approvalsProject contact name: Phone:Fax:Name Signature DateCurrency used:CDN US OtherPost audit: Company: yes no Corporate: yes noAppli catio nEXHIBIT 4CAPITAL EXPENDITURE APPROVAL PROCESSStartProject SubmitAFEQuarterly Committed NoTo C.I.Funds available for emergency onlyYes (Dollarvalue ??)In No lessNoAnnually Strategy than$300Yes yesOn No Less No PresentQuarterly Profit thanrevisedPlan $1000 planYesYesExec.Less No CommitteeProject Than Review &$1000 ApprovalYesDivisionalReview & ApprovedFinish Track ResultApproval AFEClass1&2 SpendingSavings3&4 SpendingEXHIBIT 5BUSINESS REVIEW CRITERIAUsed to Assess Divisional Commitment to Continuous ImprovementSafety●Lost time accidents per 200,000 employee hours workedProduct Quality●Number of customer complaintsFinancial●Return of investmentLost Sales●Market share % - where data availableManufacturing Effectiveness●People cost (total compensation $ including fringe) as a percentage of new sales●Plant scrap (kg) as a percentage of total production (kg)Managerial Effectiveness/Employee Empowerment●Employee survey●Training provided vs. Training planned●Number of employee grievancesSanitation●Sanitation audit ratingsOther Continuous Improvement Measurements●Number of continuous improvement projects directed against identified piles ofwaste/lost opportunity completed and in-progressEXHIBIT 6ELIGIBLE CCA DEDUCTIONYear Deduction1996$434,0001997$768,0001998$593,0001999$461,0002000$361,0002001$286,0002002$229,0002003$185,0002004$152,0002005$1731,000EXHIBIT 7MARKET INTEREST RATESON MAY 18,19961-Year Government of Canada Bond 7.37% 5-Year Government of Canada Bond 7.66% 10-Year Government of Canada Bond 8.06% 20-Year Government of Canada Bond 8.30% 30-Year Government of Canada Bond 8.35%。
财务管理会计案例教材英文版
Final, delivered cost of materials, net of discounts.
Use product design specifications.
Setting Direct Labor Standards
Rate Standards
Time Standards
Use wage surveys and labor contracts.
Use time and motion studies for each labor operation.
Setting Variable Overhead
Standards
Rate Standards
Activity Standards
The rate is the variable portion of the predetermined overhead
But why are variances
having responsibility for incurring the costs.
important to me?
Variance Analysis Cycle
Identify questions
Total standard unit cost
3.0 lbs. 2.5 hours 2.5 hours
$ 4.00 per lb. $ 14.00 per hour 3.00 per hour $
12.00 35.00
7.50 54.50
Standards vs. Budgets
Are standards the same as budgets?
might look like this:
财务管理案例(LAURENTIANBAKERIES)(英文版)
LAURENTIAN BAKERIESThe decision-maker must make a recommendation on a large expansion project. Discounted cash flow analysis is required.In late May, 1995, Danielle Knowles, vice-president of operations for Laurentian Bakeries Inc., was preparing a capital expenditure proposal to expand the company’s frozen pizza plant in Winnipeg Manitoba. If the opportunity to expand into the U.S. frozen pizza market was taken, the company would need extra capacity. A detailed analysis, including a net present value calculation, was required by the company’s Capital Allocation Policy for all capital expenditures in order to ensure that projects were both profitable and consistent with corporate strategies.COMPANY BACKGROUHDEstablished in 1984, Laurentian Bakeries Inc. (Laurentian) manufactured a variety of frozen baked food products at plants in Winnipeg (pizzas), Toronto (cakes) and Montreal (pies). While each plant operated as a profit center, they shared a common sales force located at the company’ head office in Montreal. Although the Toronto plant was responsible for over 40% of corporate revenues in fiscal 1994, and the other plants was accounted for about 30% each, all three divisions contributed equally to profits. The company enjoyed strong competitive positions in all three markets and it was the low cost producer in the pizza market. Income Statements and Balance Sheets for the 1993 to 1995 fiscal years are in Exhibits 1 and 2, respectively.Laurentian sold most of its products to large grocery chains, and in fact, supplying several Canadian chains with private label brand pizzas generated much of the sales growth. Other sales were made to institutional food services.The company’s success was, in part, the product of its management’s philosophies. The corn erstone of Laurentian’s operations was its including a commitment to a business strategy promoting continuous improvement; for example all employees were empowered to think about and make suggestions for ways of reducing waste. As Danielle Knowles saw it: “Continuous improvement is a way of life at Lauremtian.〞Also, the company was known for its above –average consideration for the human resource and environmental impact of its business decisions. These philosophies drove all policy-making, including those policies governing capital allocation. Danielle KnowlesDanielle Knowles’s career, which spanned 13 years in the food industry, had included positions in other functional areas such as marketing and finance. She had received an undergraduate degree in me chanical engineering from Queen’s University in Kingston, Ontario, and a master of business administration from the Western Business School.THE PIZZA INDUSTRYMajor segments in the pizza market were frozen pizza, deli-fresh chilled pizza, restaurant pizza and take-out pizza. Of these four, restaurant and take-out were the largest. While these segments consisted of thousands of small-owned establishments, a few large North American chains, which included Domino’s, Pizza Hut and Little Caesar’s, dominated.Although 12 firms manufactured frozen pizzas in Canada, the five largest firms, including Laurentian, accounted for 95% of production. McCain Foods was the market leader with 44% market share, while Laurentian had 21%. Per capita consumption of frozen products in Canada was one-third of the level in U.S. where retail prices were lower.ECONOMIC CONDITIONSThe North American economy had enjoyed strong growth since 1993, after having suffered a severe recession for the two previous years. Interest rates bottomed-out in mid-1994, after which the U.S. Federal Reserve slowly increased rates until early 1995 in an attempt to fight inflationary pressures. Nevertheless, North American inflation was expected to average 3% to 5%annually for the foreseeable future. The Bank of Canada followed the U.S. Federal Reserve’s lead and increased interest rates, in part to protect the Canadian dollar’s value relative to the value of the U.S. dollar. The result was a North American growth rate of gross domestic product that was showing signs of slowing down.LAURRENTIAN’S PROJECT REVIEW PROCESSAll capital projects at Laurentian were subject to review based on the company’s Capital Allocation Policy. The latest policy, which had been developed in 1989 when the company began considering factors other than simply the calculated net present value for project evaluation, was strictly enforced and managers evaluated each year partially by their division’s return on investment. The purpose of the policy was to reinforce the management philosophies by achieving certain objectives: that all projects be consistent with business strategies, support continuous improvement, consider the human resource and environmental impact, and provide a sufficient return on investment.Prior to the approval of any capital allocation, each operating division was required to develop both a Strategic and an Operating Plan. The Strategic Plan had to identify and quantify either inefficiencies or lost opportunities and establish targets for their elimination, include a three-year plan of capital requirements, link capital spending to business strategies and continuous improvement effort, and achieve the company-wide hurdle rates.The first year of the Strategic Plan became the Annual Operating Plan. This was supported by a detailed list of proposed capital projects which became the basis for capital allocation. In addition to meeting all Strategic Plan criteria, the Operating Plan had to identify major continuous improvement initiatives and budget for the associated benefits, as well as develop a training plan identifying specific training objectives for the year.These criteria were used by head office to keep the behavior of divisional managers consistent with corporate objectives. For example, the requirement to develop a training plan as part of the operational plan forced managers to be efficient with employee training and to keep continuous improvement as the ultimate objective.All proposed projects were submitted on an Authorization for Expenditure (AFE) Form for review and approval (see Exhibit 3). The AFE had to present the project’s linkage to the business strategies. In addition, it had to include specific details of economics and engineering, involvement and empowerment, human resource, and the environment. This requirement ensured that projects had been carefully thought through by forcing managers to list the items purchased, the employeesinvolved in the project, the employees adversely affected by the project, and the effect of the project on the environment.Approval of a capital expenditure proposal was contingent on three requirements which are illustrated in Exhibit 4. The first of these requirements was the operating division’s demonstrated commitment to continuous improvement (C.I.), the criteria of which are described in Exhibit 5. The second requirement was that all projects of more than $300,000 be included in the Strategic Plan. The final requirement was that for projects greater than $1 million, the operating division had to achieve its profit target. However, if a project failed to meet any of these requirements, there was a mechanism through which emergency funds might be allocated subject to the corporate executive committee’s review and approval. If the project was less than $1 million and i t met all three requirements, only divisional review and approval was necessary. Otherwise, approval was needed from the executive committee.The proposed Winnipeg plant project was considered a class 2 project as the expenditures were meant to increase capacity for existing products or to establish a facility for new products. Capital projects could fall into one of three other classes: cost reduction (Class 1); equipment or facility replacement (Class 3); or other necessary expenditures for R&D, product improvements, quality control and concurrence with legal, government, health, safety or insurance requirements including pollution control (Class 4). A project spending audit was required for all expenditures; however, a savings audit was also needed if the project was considered either 1 or 2. Each class of project had a different hurdle rate reflecting different levels of risk. Class 1 projects were considered the most risky and had a hurdle rate of 20%. Class 2 and Class 3 projects had hurdle rates of 18% and 15%, respectively.Knowles was responsible for developing the Winnipeg division’s Capital Plan and completing all AFE forms.WINNIPEG PLANT’S EXPANSION OPTIONSLaurentian had manufactured frozen pizzas at the Toronto plant until 1992. However, after the company became the sole supplier of private-label frozen pizzas for a large grocery chain and was forced to secure additional capacity, it acquired the Winnipeg frozen pizza plant from a competitor.A program of regular maintenance and equipment replacement made the new plant the low cost producer in the industry, with an operating margin that averaged 15%.The plan, with its proven commitment to continuous improvement, had successfully met its profit objective for the past three years. After the shortage of capacity had been identified as the plant’s largest source of lost opportunity, management was eager to rectify this problem as targeted for in the Strategic Plan. Because the facility had also included the proposed plant expansion in its Strategic Plan, it met all three requirements for consideration of approval for a capital project. Annual sales had matched plant capacity of 10.9 million frozen pizzas when Lauentian concluded that opportunities similar to those in Canada existed in the U.S. An opportunity surfaced whereby Laurentian could have an exclusive arrangement to supply a large U.S.-based grocery chain with its private-label-brand frozen pizzas beginning in April, 1996. As a result of this arrangement, frozen pizza sales would increase rapidly, adding 2.2 million units in fiscal 1996, another 1.8 million units in fiscal 1997, and then 1.3 million additional units to reach a total of 5.3 millionadditional units by fiscal 1998. However, the terms of the agreement would only provide Laurentian with guaranteed sales of half this amount. Knowles expected that there was a 50% chance that the grocery chain would order only the guaranteed amount. Laurentian sold frozen pizzas to its customers for $1.7 in 1995 and prices were expected to increase just enough to keep pace with inflation. Production costs were expected to increase at a similar rate.Laurentian had considered, but rejected, three other alternatives to increase its frozen pizza capacity. First, the acquisition of a competitor’s facil ity in Canada had been rejected because the equipment would not satisfy the immediate capacity needs nor achieve the cost reduction possible with expansion of the Winnipeg plant. Second, the acquisition of a competitor in the U.S. had been rejected because the available plant would require a capital infusion double that required in Winnipeg. As well, there were risks that the product quality would be inferior. Last, the expansion of the Toronto cake plant had been rejected as it would require a capital outlay similar to that in the second alternative. The only remaining alternative was the expansion of the Winnipeg plant. By keeping the frozen pizza in Winnipeg, Laurentian could better exploit economies of scale and assure consistently high product quality.The ProposalThe expansion proposal, which would require six months to complete, would recommend four main expenditures: expanding the existing building in Winnipeg by 60% would cost $1.3 million; adding a spiral freezer, $1.6 million; installing a new high speed pizza processing line, $1.3 million; and acquiring additional warehouse space, $600,000. Including $400,000 for contingency needs, the total cash outlay for the project would be $5.2 million. The equipment was expected to be useful for 10 years, at which point its salvage value would be zero.The land on which the Winnipeg plant was built valued at 250,000 and no additional land would be necessary for the project. While the expansion would not require Laurentian to increase the size of the plant’s administrative staff, Knowles wondered what portion, if any, of the $223,000 in fixed salaries should be included when evaluating the project. Likewise, she estimated that it cost Laurentian approximately $40,000 in sales staff time and expanses to secure the U.S. contract that had created the need for extra capacity. Last, net working capital needs would increase with additional sales. Working capital was the sum of inventory and accounts receivable less accounts payable, all of which were a function of sales. Knowles estimated, however, that the new high-speed line would allow the company to cut two days from average inventory age.Added to the benefit derived from increased sales, the project would reduce production costs in two ways. First, the new high-speed line would reduce plant-wide unit cost by $0.009, though only 70% of this increased efficiency would be realized in the first year. There was an equal chance, however, that only 50% of these savings could actually be achieved. Second, “other〞savings totaling $138,000 per year would also result from the new line and would increase each year at the rate of inflation.Each year, a capital cost allowance (CCA), akin to depreciation, would be deducted from operating income as a result of the capital expenditure. This deduction, in turn, would reduce the amount of corporate tax paid by Laurentian. In the event that the company did not have positive earnings in any year, the CCA deduction could be transferred to a subsequent year. However, corporate earnings were projected to be positive for the foreseeable future. Knowles compiled the eligibleCCA deduction for 10 years (see Exhibit 6). For the purpose of her analysis, she assumed that all cash flows would occur at the appropriate year-end.Three areas of environmental concern had to be addressed in the proposal to ensure both conformity with Laurentian policy and compliance with regulatory bodies and local by-laws. First, design and installation of sanitary drain systems, including re-routing of existing drains, would improve sanitation practices of effluent/wastewater discharge. Second, the provision of water-flow recording meters would quantify water volumes consumed in manufacturing and help to reduce its usage. Last, the refrigeration plant would use ammonia as the coolant as opposed to chloro-fluro-carbons. These initiatives were considered sufficient to satisfy the criteria of the Capital Allocation Policy.THE DECISIONKnowles believed that the project was consistent with the company’s business strategy since it would ensure that the Winnipeg plant continued to be the low cost producer of frozen pizzas in Canada. However, she knew that her analysis must consider all factors, including the project’s net present value. The plant’s capital allocation review committee would be following the procedures set out in the company’s Capital Allocation Policy as the basis for reviewing her recommendation. Knowles considered the implications if the project did not provide sufficient benefit to cover the Class 2 hurdle rate of 18%. Entering the U.S. grocery chains market was a tremendous opportunity and she considered what other business could result from Laurentian’s increased presence. She also wondered if the hurdle rate for a project that was meant to increase capacity for an existing product should be similar to the company’s cost of capital, since the risk of the project should be similar to the overall risk of the firm. She knew that Laurentian’s board of directors established a target capital structure that included 40% debt. She also reviewed the current Canadian market bond yields, which are listed in Exhibit 7. The spread between Government of Canada bonds and those of corporations with bond ratings of BBB, such as Laurentian, had recently been about 200 basis points (2%) for most long-term maturities. Finally, she discovered that Laurentian’s stock beta was 0.85, and that, historically, the Toronto stock market returns outperformed long-term government bonds by about 6% annually.EXHIBIT 1INCOME STATEMENTFor The Year Ending March 31($ millions)1993 1994 1995Cost of goods sold 27.4 28.7Operating expenses 52.0 55.0Interest 0.9Income taxEXHIBIT 2BALANCE SHEETFor The Year Ending March 31($ millions)1993 1994 1995Assets:Other currentFixed assets: 36.1Liabilities and Shareholder’s Equity:Other payable 0.7 1.3Shareholder’s equityAUTHORIZATION FOR EXPENDITURE FORMCAPITAL EXPENDITURE APPROVAL PROCESSBUSINESS REVIEW CRITERIAUsed to Assess Divisional Commitment to Continuous ImprovementSafety● Lost time accidents per 200,000 employee hours workedProduct Quality● Number of customer complaintsFinancial● Return of investmentLost Sales● Market share % - where data availableManufacturing Effectiveness● People cost (total compensation $ including fringe) as a percentage of new sales● Plant scrap (kg) as a percentage of total production (kg)Managerial Effectiveness/Employee Empowerment● Employee survey● Training provided vs. Training planned● Number of employee grievancesSanitation● Sanitation audit ratingsOther Continuous Improvement Measurements● Number of continuous improvement projects directed against identified piles of waste/lostopportunity completed and in-progressEXHIBIT 6ELIGIBLE CCA DEDUCTIONYear Deduction1996$434,0001997$768,0001998$593,0001999$461,0002000$361,0002001$286,0002002$229,0002003$185,0002004$152,0002005$1731,000EXHIBIT 7MARKET INTEREST RATESON MAY 18,19961-Year Government of Canada Bond 7.37% 5-Year Government of Canada Bond 7.66% 10-Year Government of Canada Bond 8.06% 20-Year Government of Canada Bond 8.30% 30-Year Government of Canada Bond 8.35%。
财务管理英语分析报告(3篇)
第1篇Executive SummaryThis report provides a comprehensive analysis of the financial management practices of XYZ Corporation, a leading multinational company in the technology sector. The report aims to evaluate the effectiveness of the company’s financial strategies, identify areas of improvement, and provide recommendations for enhancing its financial performance. The analysis covers various aspects of financial management, including budgeting, investment, risk management, and financial reporting.IntroductionXYZ Corporation, established in 1980, has grown to become a global leader in technology innovation. With operations in over 50 countries, the company has a diverse portfolio of products and services, catering to a wide range of industries. T he company’s financial management practices are crucial in ensuring its continued growth and stability in a highly competitive market.Financial Strategy Analysis1. BudgetingXYZ Corporation has implemented a robust budgeting process that involves setting annual financial targets and allocating resources accordingly. The budgeting process is based on historical data, market trends, and strategic objectives. However, the report identifies a potential area of improvement in the budgeting process, which is the lack of flexibility in adjusting budgets to accommodate unforeseen changes in the market.2. InvestmentThe company has a strong focus on investment in research and development (R&D) to stay ahead of its competitors. The investment in R&D has resulted in several successful product launches and has contributed significantly to the company’s growth. However, the report highlights the need for a more rigorous evaluation of return on investment (ROI)for different investment projects to ensure that resources are allocated to the most promising opportunities.3. Risk ManagementXYZ Corporation has a comprehensive risk management framework in place, which includes identification, assessment, and mitigation of various risks. The company has allocated resources to insurance coverage and has established contingency plans for potential disruptions. The report suggests that the company should further enhance its risk management practices by incorporating climate change and cybersecurity risks into its risk assessment process.4. Financial ReportingThe company maintains transparent and accurate financial reporting practices, adhering to international financial reporting standards (IFRS). The financial statements provide a clear picture of the company’s financial positi on and performance. However, the report notes that the company could improve its financial reporting by providing more detailed information on non-financial metrics, such as customer satisfaction and employee engagement.Financial Performance Analysis1. Revenue GrowthXYZ Corporation has experienced consistent revenue growth over the past five years, with a compound annual growth rate (CAGR) of 8%. The growth can be attributed to successful product launches, expansion into new markets, and strategic partnerships.2. ProfitabilityThe company has maintained a healthy profitability ratio, with an operating margin of 15% and a net profit margin of 10%. However, the report identifies a trend of decreasing profit margins over the past two years, which could be due to increased competition and rising costs.3. Cash FlowXYZ Corporation has a strong cash flow position, with a positive cash flow from operations of $200 million in the last fiscal year. The company has used its cash reserves to fund investments and repay debt. The report suggests that the company should continue to manage its cash flow effectively to ensure financial stability.Recommendations1. Improve Budgeting FlexibilityThe company should develop a more flexible budgeting process that allows for adjustments in response to market changes. This will help in optimizing resource allocation and ensuring that the company remains competitive.2. Enhance Investment EvaluationImplement a more rigorous evaluation process for investment projects, focusing on ROI and long-term strategic alignment. This will ensure that resources are allocated to projects with the highest potential for success.3. Expand Risk Management FrameworkIncorporate climate change and cybersecurity risks into the risk management framework. This will help the company to anticipate and mitigate potential disruptions to its operations.4. Enhance Financial ReportingProvide more detailed information on non-financial metrics in the financial statements. This will help stakeholders to gain a better understanding of the company’s overall performance and sustainability.ConclusionXYZ Corporation has demonstrated strong financial management practices, which have contributed to its growth and success. However, there are areas for improvement, particularly in budgeting flexibility, investment evaluation, risk management, and financial reporting. By implementing the recommendations outlined in this report, the company can furtherenhance its financial performance and ensure its continued leadership in the technology sector.References- Financial Statements of XYZ Corporation (2019-2023)- Annual Reports of XYZ Corporation (2019-2023)- Industry Reports on Technology Sector (2019-2023)- International Financial Reporting Standards (IFRS)第2篇Executive SummaryThis report provides a comprehensive analysis of the financial management practices of XYZ Corporation, a leading multinational company in the technology sector. The analysis covers various aspects of financial management, including financial planning, budgeting, investment, risk management, and performance evaluation. The report aims to identify strengths and weaknesses in XYZ Corporation’s financial management practices and offers recommendations for improvement.1. IntroductionXYZ Corporation, established in 1980, has grown to become a global leader in the technology sector. With operations in over 50 countries, the company has a diverse portfolio of products and services. The financial management of XYZ Corporation plays a crucial role in ensuring the company’s sustainable growth and profitability. This report analyzes the financial management practices of XYZ Corporation to provide insights into its performance and potential areas for improvement.2. Financial PlanningFinancial planning is a critical component of effective financial management. XYZ Corporation has a robust financial planning process thatinvolves setting long-term objectives, forecasting future financial requirements, and allocating resources accordingly.2.1 Long-term ObjectivesXYZ Corporation’s long-term objectives include expanding its global footprint, diversifying its product portfolio, and increasing market share. These objectives are aligned with the company’s vision of becoming a leader in the technology sector.2.2 Forecasting and Resource AllocationThe company employs a comprehensive forecasting model to predict future financial requirements. This model takes into account various factors such as market trends, competitive dynamics, and regulatory changes. Based on these forecasts, XYZ Corporation allocates resources to different business units and projects, ensuring optimal utilization of its assets.3. BudgetingBudgeting is another essential aspect of financial management, as it helps organizations monitor and control their expenses. XYZ Corporation follows a rigorous budgeting process that ensures transparency and accountability.3.1 Budgeting ProcessThe budgeting process at XYZ Corporation involves setting annual financial targets, preparing detailed budgets for each department, and reviewing and adjusting budgets as needed. The process is driven by a decentralized approach, allowing each department to have a say in budgeting decisions.3.2 Budget ControlsTo ensure budget controls, XYZ Corporation employs various techniques such as variance analysis, performance reviews, and cost-benefit analysis. These techniques help identify deviations from budgeted targets and enable timely corrective actions.4. InvestmentInvestment decisions are crucial for the growth and sustainability of a company. XYZ Corporation has a well-defined investment policy that guides its investment decisions.4.1 Investment CriteriaXYZ Corporation’s investment criteria include a focus on high-growth potential projects, alignment with the c ompany’s long-term objectives, and a thorough risk assessment. The company also prioritizes investments that contribute to its sustainability goals.4.2 Investment ApprovalsInvestment approvals are subject to a rigorous review process involving senior management and the board of directors. This ensures that only projects with a high probability of success are pursued.5. Risk ManagementRisk management is an integral part of financial management, as it helps organizations anticipate and mitigate potential risks. XYZ Corporation has a robust risk management framework that identifies, assesses, and manages risks across the organization.5.1 Risk IdentificationThe company employs various risk identification techniques, including risk workshops, brainstorming sessions, and historical data analysis. This helps identify potential risks that could impact its financial performance.5.2 Risk Assessment and MitigationOnce risks are identified, XYZ Corporation assesses their potential impact and likelihood. Based on this assessment, the company implements mitigation strategies to reduce the likelihood and impact of adverse events.6. Performance EvaluationPerformance evaluation is a critical aspect of financial management, as it helps organizations measure their success against predefined goals. XYZ Corporation has a comprehensive performance evaluation frameworkthat includes financial and non-financial metrics.6.1 Financial MetricsThe company uses a range of financial metrics, including revenue growth, profit margins, return on assets, and return on equity, to evaluate its financial performance. These metrics are compared against industry benchmarks and internal targets.6.2 Non-financial MetricsIn addition to financial metrics, XYZ Corporation also evaluates its performance against non-financial metrics such as employee satisfaction, customer satisfaction, and environmental impact.7. Strengths and Weaknesses7.1 Strengths- Robust financial planning and budgeting processes- Decentralized budgeting approach that promotes accountability- Well-defined investment policy that focuses on high-growth potential projects- Comprehensive risk management framework- Comprehensive performance evaluation framework that includes both financial and non-financial metrics7.2 Weaknesses- Lack of transparency in certain financial decisions- Limited involvement of non-financial departments in budgeting and investment decisions- Inadequate focus on emerging risks, such as cybersecurity threats8. RecommendationsTo further enhance its financial management practices, XYZ Corporation should consider the following recommendations:- Improve transparency in financial decision-making processes- Involve non-financial departments in budgeting and investmentdecisions- Develop a more robust framework for identifying and mitigating emerging risks, such as cybersecurity threats9. ConclusionThis report provides a comprehensive analysis of the financial management practices of XYZ Corporation. The company has madesignificant progress in implementing effective financial management practices, but there is still room for improvement. By addressing the identified weaknesses and implementing the recommended changes, XYZ Corporation can further strengthen its financial management practicesand ensure sustainable growth and profitability in the long term.第3篇Executive SummaryThis report provides a comprehensive analysis of the financial management practices of XYZ Corporation, a leading multinational company in the technology sector. The analysis covers various aspects offinancial management, including financial planning, investment decisions, capital structure, working capital management, and financial performance. The report aims to assess the effectiveness of XYZ Corporation’s financial management strategies and identify areas for improvement.1. IntroductionFinancial management is a critical function in any organization, as it involves managing the finances in a way that maximizes shareholder value while minimizing risks. XYZ Corporation, established in 1990, has grown to become a market leader in the technology sector, with operations inover 50 countries. The company’s financial management practices have played a significant role in its success. This report evaluates these practices to p rovide insights into the company’s financial health and future prospects.2. Financial Planning2.1 BudgetingXYZ Corporation follows a comprehensive budgeting process that includes both short-term and long-term budgets. The company’s budgeting process involves setting financial goals, allocating resources, and monitoring performance against these goals. The budgeting process is decentralized, allowing each business unit to develop its own budget while ensuring alignment with the overall corporate strategy.2.2 ForecastingXYZ Corporation utilizes various forecasting techniques to predictfuture financial performance. These techniques include trend analysis, time series analysis, and scenario analysis. The company’s financial forecast is used to guide strategic decision-making and to ensure that resources are allocated effectively.3. Investment Decisions3.1 Capital BudgetingXYZ Corporation employs a rigorous capital budgeting process to evaluate investment opportunities. The company uses a combination of net present value (NPV), internal rate of return (IRR), and payback period to assess the viability of potential investments. This ensures that the company invests in projects that generate positive returns and contribute to its long-term growth.3.2 Risk AssessmentThe company recognizes the importance of risk management in investment decisions. It conducts thorough risk assessments for each investment opportunity, considering factors such as market conditions, regulatorychanges, and technological advancements. This helps XYZ Corporation to make informed decisions and mitigate potential risks.4. Capital Structure4.1 Debt-Equity RatioXYZ Corporation maintains a balanced capital structure, with a moderate level of debt. The company’s debt-equity ratio is 2:1, indicating a preference for equity financing to ensure financial stability and minimize the risk of default.4.2 Cost of CapitalThe company’s cost of capital is a key determinant of its financial decisions. XYZ Corporation calculates its cost of capital using the weighted average cost of capital (WACC) model, which considers the cost of equity and the cost of debt. This ensures that the company’s investment decisions are financially viable and align with its overall strategy.5. Working Capital Management5.1 Cash ManagementXYZ Corporation implements effective cash management practices to ensure liquidity and optimize cash flow. The company maintains a cash reserve to cover short-term obligations and invests surplus cash in short-term, high-quality securities to generate returns.5.2 Inventory ManagementThe company employs a just-in-time (JIT) inventory management system to minimize inventory costs and reduce lead times. This system ensures that inventory levels are maintained at optimal levels, minimizing the risk of stockouts and obsolescence.6. Financial Performance6.1 Revenue GrowthXYZ Corporation has demonstrated consistent revenue growth over the past five years, with a compound annual growth rate (CAGR) of 8%. This growth can be attributed to the company’s strong product portfolio, effective marketing strategies, and expansion into new markets.6.2 ProfitabilityThe company has maintained a healthy profitability ratio, with an operating margin of 15% and a net profit margin of 10%. This indicates that the company is generating sufficient profits to cover its costs and reinvest in its business.7. ConclusionXYZ Corporation has demonstrated effective financial management practices that have contributed to its success as a market leader in the technology sector. The company’s focus on financial planning, investment decisions, capital structure, working capital management, and financial performance has allowed it to achieve sustainable growth and profitability. However, there are areas for improvement, such as further diversification of the capital structure and increased investment in research and development. By addressing these areas, XYZ Corporation can continue to maintain its competitive advantage and achieve long-term success.Recommendations1. Diversify the capital structure by increasing the proportion of equity financing to reduce the risk of default.2. Increase investment in research and development to enhance product innovation and maintain a competitive edge.3. Continuously monitor and evaluate financial performance to identify areas for improvement and make informed decisions.References- Brigham, E. F., & Ehrhardt, M. C. (2018). Financial Management: Theory & Practice. Cengage Learning.- Financial Times. (2022). XYZ Corporation Annual Report. - International Financial Reporting Standards (IFRS).。
财务管理英文-小企业案例sb21
I
A third problem is that as the firm grows, the family may be unable to provide the financial resources necessary to support that growth. If external funds are needed, they will generally be more difficult to obtain in a private, closely held business. Perhaps an even more serious problem is that, since the family’s entire wealth is tied up in a single business, the family holds an undiversified portfolio. As was explained in Chapter 5, diversification reduces a portfolio’s risk. Thus, the goals of maintaining control and reducing risk through diversification are in conflict. Again, a public offering would allow family members to sell some of their stock and to diversify their own personal portfolios. Both the diversification motive and family members’ liquidity needs often indicate that a business’s ownership structure should be changed. There is, however, another alternative besides going public — that of selling the business outright to another company or of merging it into a larger firm. This alternative is often overlooked by owners of closely held businesses, because it frequently means an immediate and complete loss of control. Selling out deserves special consideration, however, because it can often produce far greater value than can be achieved in a public offering. With the sale of the business, the family gives up control, yet that control is what makes the firm more valuable in a merger than in a public offering. Merger premiums for public companies often range from 50 to 70 percent over the market price. Therefore, a company worth $10 million in the public market might be acquired for a price of $15 to $17 million in a merger. In contrast, initial public offerings (IPOs) are normally made at below-market prices. Furthermore, if the owners sell a significant amount of their stock in the IPO, the market will take that as a signal that the company’s future is dim, and the price will be depressed even more. What are the disadvantages to a merger? An obvious disadvantage is the loss of control. Also, family members risk losing employment in the firm. In such a case, however, they will have additional wealth to sustain them while they seek other opportunities. The owners of a closely held family business must consider the costs and benefits of continuing to be closely held versus either going public or being acquired in a merger. Of the three alternatives, the merger alternative is likely to provide the greatest benefits to the family members.
财务管理会计案例培训课件英文版
Product-Level Activity
Organizationsustaining Activity
Customer-Level Activity
Identifying Activity to Include
Activity Cost Pool is a “bucket” in
Factory equipment depreciation
$300,000
Percent consumed by customer orders 20%
$ 60,000
Assigning Costs to Activity Cost Pools
Using the total costs and percentage consumption of overhead, costs are assigned to activity pools.
and then to products.
Departmental Overhead Rates
Indirect
Stage One:
Labor
Costs assigned
to pools
Cost pools
Department 1
Indirect Materials
Department 2
Other Overhead
Activity Based Costing
Departmental Overhead Rates
Plantwide Overhead
Rate
Overhead Allocation
Plantwide Overhead Rate
财务管理案例分析英文版
财务管理案例分析英文版The decision-maker must make a recommendation on a large expansion project. Discounted cash flow analysis is required.In late May, 1995, Danielle Knowles, vice-president of operations for Laurentian Bakeries Inc., was preparing a capital expenditure proposal to expand the company’s frozen pizza plant in Winnipeg Manitoba. If the opportunity to expand into the U.S. frozen pizza market was taken, the company would need extra capacity. A detailed analysis, including a net present value calculation, was required by the company’s Capital Allocation Policy for all capital expenditures in order to ensure that projects were both profitable and consistent with corporate strategies.COMPANY BACKGROUHDEstablished in 1984, Laurentian Bakeries Inc. (Laurentian) manufactured a variety of frozen baked food products at plants in Winnipeg (pizzas), Toronto (cakes) and Montreal (pies). While each plant operated as a profit center, they shared a common sales force located at the company’ head office in Montreal. Although the Toronto plant was responsible for over 40% of corporate revenues in fiscal 1994, and the other plants was accounted for about 30% each, all three divisions contributed equally to profits. The company enjoyed strong competitive positions in all three markets and it was the low cost producer in the pizza market. Income Statements and Balance Sheets for the 1993 to 1995 fiscal years are in Exhibits 1 and 2, respectively.Laurentian sold most of its products to large grocery chains, and in fact, supplying several Canadian chains with private label brand pizzas generated much of the sales growth. Other sales were made to institutional food services.The company’s success was, in part, the product of its management’s philosophies. The cornerstone of Laurentian’s operations was its including a commitment to a business strategy promoting continuous improvement; for example all employees were empowered to think about and make suggestions for ways of reducing waste. As Danielle Knowles saw it: 〝Continuous improvement is a way of life at Lauremtian.〞Also, the company was known for its above –average consideration for the human resource and environmental impact of its business decisions. These philosophies drove all policy-making, including those policies governing capital allocation. Danielle KnowlesDanielle Knowles’s career, which spanned 13 years in the food industry, had included p ositions in other functional areas such as marketing and finance. She had received an undergraduate degree in mechanical engineering from Queen’s University in Kingston, Ontario, and a master of business administration from the Western Business School.THE PIZZA INDUSTRYMajor segments in the pizza market were frozen pizza, deli-fresh chilled pizza, restaurant pizza and take-out pizza. Of these four, restaurant and take-out were the largest. While these segmentsconsisted of thousands of small-owned establishments, a few large North American chains, which included Domino’s, Pizza Hut and Little Caesar’s, dominated.Although 12 firms manufactured frozen pizzas in Canada, the five largest firms, including Laurentian, accounted for 95% of production. McCain Foods was the market leader with 44% market share, while Laurentian had 21%. Per capita consumption of frozen products in Canada was one-third of the level in U.S. where retail prices were lower.ECONOMIC CONDITIONSThe North American economy had enjoyed strong growth since 1993, after having suffered a severe recession for the two previous years. Interest rates bottomed-out in mid-1994, after which the U.S. Federal Reserve slowly increased rates until early 1995 in an attempt to fight inflationary pressures. Nevertheless, North American inflation was expected to average 3% to 5%annually for the foreseeable future. The Bank of Canada followed the U.S. Federal Reserve’s lead and increased interest rates, in part to protect the Canadian dollar’s value relative to the value of the U.S. dollar. The result was a North American growth rate of gross domestic product that was showing signs of slowing down.LAURRENTIAN’S PROJECT REVIEW PROCESSAll capital projects at Laurentian were subject to review based on the company’s Capital Allocation Policy. The latest policy, which had been developed in 1989 when the company began considering factors other than simply the calculated net present value for project evaluation, was strictly enforced and managers evaluated each year p artially by their division’s return on investment. The purpose of the policy was to reinforce the management philosophies by achieving certain objectives: that all projects be consistent with business strategies, support continuous improvement, consider the human resource and environmental impact, and provide a sufficient return on investment.Prior to the approval of any capital allocation, each operating division was required to develop both a Strategic and an Operating Plan. The Strategic Plan had to identify and quantify either inefficiencies or lost opportunities and establish targets for their elimination, include a three-year plan of capital requirements, link capital spending to business strategies and continuous improvement effort, and achieve the company-wide hurdle rates.The first year of the Strategic Plan became the Annual Operating Plan. This was supported by a detailed list of proposed capital projects which became the basis for capital allocation. In addition to meeting all Strategic Plan criteria, the Operating Plan had to identify major continuous improvement initiatives and budget for the associated benefits, as well as develop a training plan identifying specific training objectives for the year.These criteria were used by head office to keep the behavior of divisional managers consistent with corporate objectives. For example, the requirement to develop a training plan as part of the operational plan forced managers to be efficient with employee training and to keep continuous improvement as the ultimate objective.All proposed projects were submitted on an Authorization for Expenditure (AFE) Form for review and approval (see Exhibit 3). The AFE had to present the project’s linkage to the businessstrategies. In addition, it had to include specific details of economics and engineering, involvement and empowerment, human resource, and the environment. This requirement ensured that projects had been carefully thought through by forcing managers to list the items purchased, the employees involved in the project, the employees adversely affected by the project, and the effect of the project on the environment.Approval of a capital expenditure proposal was contingent on three requirements which are illustrated in Exhibit 4. The first of these re quirements was the operating division’s demonstrated commitment to continuous improvement (C.I.), the criteria of which are described in Exhibit 5. The second requirement was that all projects of more than $300,000 be included in the Strategic Plan. The final requirement was that for projects greater than $1 million, the operating division had to achieve its profit target. However, if a project failed to meet any of these requirements, there was a mechanism through which emergency funds might be allocated subject to the corporate executive committee’s review and approval. If the project was less than $1 million and it met all three requirements, only divisional review and approval was necessary. Otherwise, approval was needed from the executive committee.The proposed Winnipeg plant project was considered a class 2 project as the expenditures were meant to increase capacity for existing products or to establish a facility for new products. Capital projects could fall into one of three other classes: cost reduction (Class 1); equipment or facility replacement (Class 3); or other necessary expenditures for R&D, product improvements, quality control and concurrence with legal, government, health, safety or insurance requirements including pollution control (Class 4). A project spending audit was required for all expenditures; however, a savings audit was also needed if the project was considered either 1 or 2. Each class of project had a different hurdle rate reflecting different levels of risk. Class 1 projects were considered the most risky and had a hurdle rate of 20%. Class 2 and Class 3 projects had hurdle rates of 18% and 15%, respectively.Knowles was responsible for developing the Winnipeg division’s Capital Plan and completing all AFE forms.WINNIPEG PLANT’S EXPANSION OPTIONSLaurentian had manufactured frozen pizzas at the Toronto plant until 1992. However, after the company became the sole supplier of private-label frozen pizzas for a large grocery chain and was forced to secure additional capacity, it acquired the Winnipeg frozen pizza plant from a competitor.A program of regular maintenance and equipment replacement made the new plant the low cost producer in the industry, with an operating margin that averaged 15%.The plan, with its proven commitment to continuous improvement, had successfully met its profit objective for the past three years. After the shortage of capacity had been identified as the plant’s largest source of lost opportunity, management was eager to rectify this problem as targeted for in the Strategic Plan. Because the facility had also included the proposed plant expansion in its Strategic Plan, it met all three requirements for consideration of approval for a capital project. Annual sales had matched plant capacity of 10.9 million frozen pizzas when Lauentian concluded that opportunities similar to those in Canada existed in the U.S. An opportunity surfaced whereby Laurentian could have an exclusive arrangement to supply a large U.S.-based grocery chain withits private-label-brand frozen pizzas beginning in April, 1996. As a result of this arrangement, frozen pizza sales would increase rapidly, adding 2.2 million units in fiscal 1996, another 1.8 million units in fiscal 1997, and then 1.3 million additional units to reach a total of 5.3 million additional units by fiscal 1998. However, the terms of the agreement would only provide Laurentian with guaranteed sales of half this amount. Knowles expected that there was a 50% chance that the grocery chain would order only the guaranteed amount. Laurentian sold frozen pizzas to its customers for $1.7 in 1995 and prices were expected to increase just enough to keep pace with inflation. Production costs were expected to increase at a similar rate.Laurentian had considered, but rejected, three other alternatives to increase its frozen pizza capacity. First, the acquisition of a competitor’s facility in Canada had been rejected because the equipment would not satisfy the immediate capacity needs nor achieve the cost reduction possible with expansion of the Winnipeg plant. Second, the acquisition of a competitor in the U.S. had been rejected because the available plant would require a capital infusion double that required in Winnipeg. As well, there were risks that the product quality would be inferior. Last, the expansion of the Toronto cake plant had been rejected as it would require a capital outlay similar to that in the second alternative. The only remaining alternative was the expansion of the Winnipeg plant. By keeping the frozen pizza in Winnipeg, Laurentian could better exploit economies of scale and assure consistently high product quality.The ProposalThe expansion proposal, which would require six months to complete, would recommend four main expenditures: expanding the existing building in Winnipeg by 60% would cost $1.3 million; adding a spiral freezer, $1.6 million; installing a new high speed pizza processing line, $1.3 million; and acquiring additional warehouse space, $600,000. Including $400,000 for contingency needs, the total cash outlay for the project would be $5.2 million. The equipment was expected to be useful for 10 years, at which point its salvage value would be zero.The land on which the Winnipeg plant was built valued at 250,000 and no additional land would be necessary for the project. While the expansion would not require Laurentian to increase the size of the plant’s administrative staff, Knowles wondered what portion, if any, of the $223,000 in fixed salaries should be included when evaluating the project. Likewise, she estimated that it cost Laurentian approximately $40,000 in sales staff time and expanses to secure the U.S. contract that had created the need for extra capacity. Last, net working capital needs would increase with additional sales. Working capital was the sum of inventory and accounts receivable less accounts payable, all of which were a function of sales. Knowles estimated, however, that the new high-speed line would allow the company to cut two days from average inventory age.Added to the benefit derived from increased sales, the project would reduce production costs in two ways. First, the new high-speed line would reduce plant-wide unit cost by $0.009, though only 70% of this increased efficiency would be realized in the first year. There was an equal chance, however, that only 50% of these savings could actually be achieved. Second, 〝other〞 savings totaling $138,000 per year would also result from the new line and would increase each year at the rate of inflation.Each year, a capital cost allowance (CCA), akin to depreciation, would be deducted from operating income as a result of the capital expenditure. This deduction, in turn, would reduce the amount ofcorporate tax paid by Laurentian. In the event that the company did not have positive earnings in any year, the CCA deduction could be transferred to a subsequent year. However, corporate earnings were projected to be positive for the foreseeable future. Knowles compiled the eligible CCA deduction for 10 years (see Exhibit 6). For the purpose of her analysis, she assumed that all cash flows would occur at the appropriate year-end.Three areas of environmental concern had to be addressed in the proposal to ensure both conformity with Laurentian policy and compliance with regulatory bodies and local by-laws. First, design and installation of sanitary drain systems, including re-routing of existing drains, would improve sanitation practices of effluent/wastewater discharge. Second, the provision of water-flow recording meters would quantify water volumes consumed in manufacturing and help to reduce its usage. Last, the refrigeration plant would use ammonia as the coolant as opposed to chloro-fluro-carbons. These initiatives were considered sufficient to satisfy the criteria of the Capital Allocation Policy.THE DECISIONKnowles believed that the project was consistent with the company’s business strategy since it would ensure that the Winnipeg plant continued to be the low cost producer of frozen pizzas in Canada. However, she knew that her analysis mu st consider all factors, including the project’s net present value. The plant’s capital allocation review committee would be following the procedures set out in the company’s Capital Allocation Policy as the basis for reviewing her recommendation. Knowles considered the implications if the project did not provide sufficient benefit to cover the Class 2 hurdle rate of 18%. Entering the U.S. grocery chains market was a tremendous opportunity and she considered what other business could result from Laurentian’s increased presence. She also wondered if the hurdle rate for a project that was meant to increase capacity for an existing product should be similar to the company’s cost of capital, since the risk of the project should be similar to the overall risk of the firm. She knew that Laurentian’s board of directors established a target capital structure that included 40% debt. She also reviewed the current Canadian market bond yields, which are listed in Exhibit 7. The spread between Government of Canada bonds and those of corporations with bond ratings of BBB, such as Laurentian, had recently been about 200 basis points (2%) for most long-term maturities. Finally, she discovered that Laurentian’s stock beta was 0.85, and that, historically, the Toronto stock market returns outperformed long-term government bonds by about 6% annually.EXHIBIT 1INCOME STATEMENTFor The Year Ending March 31($ millions)1993 1994 1995Revenues $91.2 95.8 101.5Cost of goods sold 27.4 28.7 30.5Gross income 63.8 67.1 71.0Operating expenses 52.0 55.0 58.4Operating income 11.8 12.1 12.6Interest 0.9 1.0 1.6Income before tax 10.9 11.1 11.0Income tax 4.2 4.3 4.2Net income 6.7 6.8 6.8EXHIBIT 2BALANCE SHEETFor The Year Ending March 31($ millions)1993 1994 1995Assets:Cash $6.2 9.4 13.1Accounts Receivable 11.3 11.8 12.5Inventory 6.2 6.6 7.0Prepaid expenses 0.3 0.6 2.2Other current 0.9 0.9Total current 24.0 29.3 35.7Fixed assets: 35.3 36.1 36.4 TOTAL 59.3 65.4 72.1 Liabilities and Shareholder’s Equity:Accounts payable 7.5 7.9 8.3Other payable 0.7 1.3 2.2Total current 8.2 9.2 10.5 Long-term debt 16.8 20.4 24.3 Shareholder’s equity 34.3 35.8 37.3 TOTAL 59.3 65.4 72.1AUTHORIZATION FOR EXPENDITURE FORMCAPITAL EXPENDITURE APPROVAL PROCESSBUSINESS REVIEW CRITERIAUsed to Assess Divisional Commitment to Continuous ImprovementSafety● Lost time accidents per 200,000 employee hours workedProduct Quality● Number of customer complaintsFinancial● Return of investmentLost Sales● Market share % - where data availableManufacturing Effectiveness● People cost (total compensation $ including fringe) as a percentage of new sales● Plant scrap (kg) as a percentage of total production (kg)Managerial Effectiveness/Employee Empowerment● Employee survey● Training provided vs. Training planned● Number of employee grievancesSanitation● Sanitation audit ratingsOther Continuous Improvement Measurements● Number of continuous improvement projects directed against identified piles of waste/lostopportunity completed and in-progressEXHIBIT 6ELIGIBLE CCA DEDUCTIONYear Deduction1996$434,0001997$768,0001998$593,0001999$461,0002000$361,0002001$286,0002002$229,0002003$185,0002004$152,0002005$1731,000EXHIBIT 7MARKET INTEREST RATESON MAY 18,19961-Year Government of Canada Bond 7.37% 5-Year Government of Canada Bond 7.66% 10-Year Government of Canada Bond 8.06% 20-Year Government of Canada Bond 8.30% 30-Year Government of Canada Bond 8.35%。
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unattainable and discourage most
employees.
Human Resources Manager
Setting Direct Material Standards
Price Standards
Quantity Standards
Total standard unit cost
3.0 lbs. 2.5 hours 2.5 hours
$ 4.00 per lb. $ 14.00 per hour 3.00 per hour $
12.00 35.00
7.50 54.50
Standards vs. Budgets
Are standards the same as budgets?
Amount
Direct Labor
Direct Material
Standard
Manufacturing Overhead
Type of Product Cost
Setting Standard Costs
Accountants, engineers, personnel administrators, and production managers combine efforts to set standards based on
First, they point to causes of
I see that there
problems and directions for improvement.
is an unfavorable variance.
Second, they trigger investigations in departments
A standard is the expected cost for one
unit.
A budget is the expected cost for all
units.
A SstatnadanrddcaosrtdvarCianocse its Vtheaarmiaounntcbey swhich
财务会计管理案例分析（英文版）
Standard Costs
Based on carefully predetermined amounts.
Standard Costs are
Used for planning labor, material and overhead requirements.
The expected level of performance.
rate.
The activity is the base used to calculate
the predetermined overhead.
Standard Cost Card – Variable A standard cPorsot dcaurcdtfioornoCneousntit of product
Final, delivered cost of materials, net of discounts.
Use product design specifications.
Setting Direct Labor Standards
Rate Standards
Time Standards
Use wage surveys and labor contracts.
But why are variances
having responsibility for incurring the costs.
important to me?
Variance Analysis Cycle
Identify questions
Benchmarks for measuring performance.
MSatnaagnerds aforcuds oCn oqusanttsities and costs
that exceed standards, a practice known as management by exception.
experience and expectations.
Setting Standard Costs
Should we use practical standards or ideal standards?
Engineer
Managerial Accountant
PractiScalesttatnindagrdsStandard Costs
should be set at levels that are currently attainable with reasonable and efficient effort.
Production manager
Setting StandaIradgreCe.oIdseatlsstandards,
Use time and motion studies for each labor operation.
Setting Variable Overhead
Standards
Rate Standards
Activity Standards
The rate is the variable portion of the predetermined overhead
an actual cost differs from the standard cost.
Product Cost
Standard
This variance is unfavorable because he standard cost.
Standard Cost Variances
might look like this:
Inputs
A
Standard Quantity or Hours
B
Standard Price
or Rate
AxB
Standard Cost
per Unit
Direct materials Direct labor Variable mfg. overhead