Fossil Inc. Financial Statement Analysis

2301 words - 10 pages




Table of Contents6
Introduction 1
Chosen Policies and Quality of Numbers 1
Part 1: Overview of Balance Sheet 1
1.1 Major types of assets and unusual amounts of components 1
1.2 Major types of liabilities and unusual amounts of components 2
1.3 Major types of Equities and unusual amounts of components 2
Part 2: Overview of the Income Statement 3
2.1 Major sources of revenues, expenses, gains and losses 3
2.2 Unique Items for Income Statement for recreational goods 3
2.3 Unusual amounts changes in the Income Statement 3
Part 3: Overview of Statement of Cash Flow 4
3.1 Analysis for operating ...view middle of the document...

Chosen Policies and Quality of Numbers
Chosen policies
Inventories are stated at the lower of market or average cost (LCM). When the current value of Fossil’s inventories is less than its reported cost, Fossil would set up an allowance for inventories. The inventory allowance reduces the reported inventory amount to the current market value.Fossil Inc. increases its bad debt allowance in the 2010 fiscal year because of the difficult economic environment, such accounting policy increase the amounts of accounts receivable in the Statement of Balance Sheet.
Quality of numbers
Pervasive constraint is benefits> costs, user-specific quality is understandable, overall quality is decision usefulness, primary decision-specific qualities are relevant and reliable, ingredients of primary qualities are predictive value, feedback value, timeliness, verifiability, representational faithfulness and neutrality, secondary and interactive quality is comparability and consistency and threshold for recognition is materiality.
Fossil Inc.’s Financial Statements do not show that it is aggressive since the D/E ratio is < 0.01, it shows Fossil Inc. runs mainly by its equity but not debt. Also, Fossil Inc. is not a risky but a profitable company, maybe it will be much stronger in future according to its ranking and financial statements.

Part 1: Overview of Balance Sheet

1.1 Major types of assets and unusual amounts of components
In exhibit 1, total assets for Fossil was $1,467,573 thousands, there were cash and cash equivalents (27% of the total assets), inventories (25% of the total assets), accounts receivable (18% of the total assets) and PPE (15% of the total assets). As a retailer and manufacturer, those assets are essential to Fossil Inc. One unusual amount of components is that the amount of accounts receivable is much bigger than that in the last three years, the notes about accounts receivable says that bad debt explains the most of the increase because of the competing global business. Another one is that the sharp increase of inventories, it may result from sales increase.

1.2 Major types of liabilities and unusual amounts of components
In exhibit 2, the total liabilities of Fossil Inc was $415,865, accrued expense (44% of total liabilities), accounts payable (29% of total liabilities) and deferred income tax liabilities (12%) are the main types of liabilities. Fossil receives many orders every year, so the accrued expense is taken into the main liabilities. Additionally, based liabilities should be one of the main liabilities since Fossil need money to expand. Royalties in 2010 are 2.368 times as many as those in 2009, and deferred income tax liabilities are 1.77 times as many as those in 2009. Those may all because Fossil wants to expand its market share.

1.3 Major types of Equities and unusual amounts of components
In exhibit 3, treasury stock (-17.3%), additional paid-in capital...

Other Papers Like Fossil Inc. Financial Statement Analysis

Analysis of Financial Statement

4903 words - 20 pages Analysis of Financial Statement Formal Assignment Report Table of Contents Introduction ...................................................................................................................... 3 1. Brief Review ................................................................................................................. 3 2. Analysis of Financial Performance

Financial Statement Analysis

2469 words - 10 pages CHAPTER 5—BASICS OF ANALYSIS MULTIPLE CHOICE 1. Statements in which all items are expressed only in relative terms (percentages of a base) are termed: a.|Vertical Statements| b.|Horizontal Statements| c.|Funds Statements| d.|Common-Size Statements| e.|none of the answers are correct| ANS: D 2. In financial statement analysis, ratios are: a.|the only type of analysis where industry data are available| b.|absolute numbers

Financial Statement Analysis

1081 words - 5 pages Assignment 1: Financial Statement Analysis Presented To: Professor Coon Presented By: Carolyn Campbell Class: HSA 525 Date: July 28, 2013 Assignment 1 1. Based on your review of the financial statements, suggest a key insight about the financial health of the company. Speculate on the likely reaction to the financial statements from various stakeholder groups (employee, investors, shareholders). Provide support for your

Financial Statement Analysis

4656 words - 19 pages FINANCIAL COMPARISON BETWEEN THE BOEING COMPANY AND LOCKHEED MARTIN Keith L. Hohl EMGT 452 Semester Project 14 December 1999 Table of Contents 1. Introduction/Study Objective 2. Boeing Financial Statement and Analysis 2.1. Background and Product Lines 2.2. Consolidated Balance and Income Statements 2.3. Divisional Financial Statements 2.4. Ratio and Trend Analysis 3. Lockheed Martin Financial

Financial Statement Analysis - 7520 words

7520 words - 31 pages Financial Statement Analysis Vertical Common Size – Balance Sheet Mar 13  Mar 12  Mar 11  Mar 10  Mar 09  Mar 08  Mar 13  Mar 12  Mar 11  Mar 10  Mar 09  Mar 08    SOURCES OF FUNDS :  Share Capital    Reserves Total    Equity Share Warrants    Equity Application Money   Total Shareholders Funds   Secured Loans   Unsecured Loans     Total Debt   Other Liabilities    Total Liabilities 971.41 971.41 959.41 887.41 6,203.45 6,203.30 54,238.27

Financial Statement Analysis - 4114 words

4114 words - 17 pages [pic] [pic] Assignment On “A Business Analysis of Square Pharmaceutical Ltd.” Course Title: Financial Statement Analysis Course code: ACT-513 Assignment on “Business Analysis of” (Square Pharmaceutical Ltd) Submitted to: Mr. Mohammed Sakhawat Hossain Assistant Professor Faculty of Business and Economics Daffodil International University Submitted by

Financial Statement Analysis - 2670 words

2670 words - 11 pages performance in the marketplace. One of these tools can be the used of financial ratios, which gives to managers the information to set up strategies in order to make decisions in the future. However, it is important to highlight that this ratios provide an overview of the business's financial condition, but an analysis in depth is needed to know the reasons why certain changes have occurred (Maclaney and Atrill, 2002). Nevertheless, there are some

Financial Statement Analysis - 3385 words

3385 words - 14 pages Financial Statement Analysis Paper Starbucks Coffee Company SUMMARY/INTRODUCTION Starbucks identifies itself as “the premier roaster, marketer and retailer of specialty coffee in the world” and fits squarely in the Coffee Shop industry. According to the IBISWorld Industry Report 72221b (Coffee & Snack Shops in the US), the “industry is composed of establishments that prepare or serve specialty snacks and nonalcoholic beverages including

Fnt1 Financial Statement Analysis

1069 words - 5 pages Financial Statement Analysis FNT1: Financial Statement Analysis Task 319.1.2-04, 2.1-01-03 April 1, 2012 MEMORANDUM TO: CEO FROM: RE: Ratio Analysis DATE: April 1, 2012 ______________________________________________________________________________ I have been asked to compare and analyze the rations of Company G for the previous year as well as the industry standards. • Current Ratio: This

Financial Statement Analysis - 1549 words

1549 words - 7 pages and qualifies it for an A to Aa rating. The operating and the EBITA margins are very strong (Aa to Aaa level). However, the company must make significant capital investments and has a large asset base. This yields CAPEX ratio and EBITA to total assets at the lower end of investment-grade debt. M4-17. Pfizer, Inc., (PFE) demonstrates marked improvement in almost all aspects of financial health, making the company less risky to creditors in

Analysis Financial Statement of Company

2282 words - 10 pages Financial Statement Analysis Paper Example 1: Dell Computer Dell Inc. Income Statement Revenue Cost of Goods Sold Gross Profit R&D Selling General & Administrative Non Recurring Others Operating Income Depreciation Expense Other Income/Expense EBIT Interest Expense Tax Expense Income from Cont Operations Net Income Balance Sheet Cash Short Term Investments Accounts Receivable Inventory Other Current Assets Total Current Assets Long Term

Related Essays

Financial Analysis, Apple Inc

4761 words - 20 pages Financial Analysis, Apple Inc. For the fiscal year ended September 24, 2011 By Michael Sarkis 04/12/2012 Table of Contents Abstract 3 Background 3 Stock Performance 5 Ratio Calculations & Interpretations 6 Liquidity Ratios 6 I. Current Ratio 6 II. Quick Ratio 7 Asset Management Ratios 7 I. Inventory Turnover 7 II. Total Asset Turnover 8 Financial Leverage Management Ratios 8 Profitability Ratios 9

Financial Statement Analysis 1997 Words

1997 words - 8 pages Financial Statement Analysis and Interpretation FIN/571 Corporate Finance November 23, 2015 Financial Statement Analysis The goal of any business regardless of its size should be to obtain and maintain financial profitability and maximize its shareholder’s wealth. The goal of a good manager is to have a solid understanding of his organization’s financial functionality in order to achieve the aforementioned by others. With a

Financial Statement Analysis 631 Words

631 words - 3 pages Financial Statement Analysis Financial statements are the primary information companies publish about themselves. Financial statement analysis is the method used by any interested party to answer questions about a company by extracting the information from company financial statements. Financial statement analysis mainly focuses on investors, since businesses are in business to make profits, financial statements are prepared with

Financial Statement Analysis 3543 Words

3543 words - 15 pages FINANCIAL MANAGEMENT Financial Statement Analysis The process of determining financial strengths and weaknesses of a firm by establishing strategic relationship between the items of the balance sheet, profit and loss account and other operative data. Financial Statement Analysis Metcalf and Titard:It is a process of evaluating the relationship between component parts of a financial statement to obtain a better under standing of a